General Mills, Inc. (NYSE: GIS) saw its share price wilt, after the company reported weaker-than-expected earnings for its first quarter.
The Minneapolis-based cereal conglomerate issued a release Wednesday morning, revealing net sales declined 4% to $3.8 billion, while net earnings attributable to General Mills totaled $405 million, down 1% from a year ago. Diluted earnings per share of $0.69 increased 3%, with lower net earnings offset by 4% fewer average diluted shares outstanding.
Said CEO Jeff Harmening, “"Our number-one priority in fiscal 2018 is strengthening our top-line performance. Our first-quarter net sales finished in line with our expectations, and our focus on our global growth priorities drove important improvement in our retail sales trends. This included a 300-basis-point improvement in the U.S., with better results in each of our top five categories.
Harmening continued, “We anticipated a slow start to the year on the bottom line, and we continue to expect sequential improvement in profitability in the coming quarters. Looking ahead, we're taking deliberate steps through innovation, brand building, and increased organizational agility to position the company for long-term top- and bottom-line growth, in line with our shareholder return model."
For the full fiscal year 2018, organic net sales are expected to decline 1% to 2%, an improvement of 200 to 300 basis points over fiscal 2017 results; adjusted operating profit margin is expected to be above year-ago levels; adjusted diluted EPS is expected to increase 1% to 2% from the base of $3.08 earned in fiscal 2017.
General Mills shares slumped $3.62, or 6.5%, to $51.76, in the last hour of trading on Wednesday.
