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General Mills(GIS) - 2025 Q3 - Quarterly Report
GISGeneral Mills(GIS)2025-03-19 20:26
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Financial Performance - In Q3 fiscal 2025, net sales decreased by 5% to 4,842.2million,withorganicnetsalesalsodownby54,842.2 million, with organic net sales also down by 5% compared to the same period last year[92][96][93]. - Operating profit decreased by 2% to 891 million, with an operating profit margin of 18.4%, which is an increase of 50 basis points[92][93]. - Diluted earnings per share fell by 4% to 1.12,whileadjusteddilutedearningspersharedecreasedby151.12, while adjusted diluted earnings per share decreased by 15% on a constant-currency basis to 1.00[92][93]. - For the nine-month period ended February 23, 2025, net sales were 14,930.4million,adecreaseof114,930.4 million, a decrease of 1% compared to the same period last year[110][111]. - Operating profit for the nine-month period increased by 6% to 2,800.8 million, with an operating profit margin of 18.8%, up 130 basis points[109][110]. - Segment operating profit decreased 20 percent to 102millioninQ3fiscal2025,comparedto102 million in Q3 fiscal 2025, compared to 128 million in Q3 fiscal 2024, primarily due to higher SG&A expenses and input costs[149]. - Adjusted operating profit for the quarter ended February 23, 2025, was 800.8million,representingamarginof16.5800.8 million, representing a margin of 16.5%[194]. - For the nine-month period ended February 23, 2025, adjusted operating profit was 2,730.1 million, with a margin of 18.3%[194]. Sales and Revenue Breakdown - North America Retail net sales decreased 7% to 3,009.1millioninthethirdquarteroffiscal2025comparedto3,009.1 million in the third quarter of fiscal 2025 compared to 3,242.1 million in the same period last year[125]. - International net sales decreased 4% to 651.3millioninthethirdquarteroffiscal2025comparedto651.3 million in the third quarter of fiscal 2025 compared to 680.1 million in the same period last year[135]. - North America Pet net sales were flat at 623.7millioninthethirdquarteroffiscal2025comparedto623.7 million in the third quarter of fiscal 2025 compared to 624.5 million in the same period last year[143]. - North America Foodservice net sales increased 1 percent to 555.3millioninQ3fiscal2025,drivenbyfavorablenetpricerealization,partiallyoffsetbyadecreaseinvolumegrowthcontributions[151].−NorthAmericaFoodservicenetsalesincreased3percentto555.3 million in Q3 fiscal 2025, driven by favorable net price realization, partially offset by a decrease in volume growth contributions[151]. - North America Foodservice net sales increased 3 percent to 1,721.5 million in the nine-month period ended February 23, 2025, compared to 1,669.7 million in the same period in fiscal 2024, driven by volume growth and favorable net price realization[153]. Expenses and Costs - SG&A expenses increased by 91 million to 2,552 million in the nine-month period, with SG&A as a percentage of net sales rising by 90 basis points[116]. - Cost of sales decreased by 228 million to 9,671millioninthenine−monthperiod,primarilyduetolowervolumeandproductrateandmix[115].−Thecompanyrecorded9,671 million in the nine-month period, primarily due to lower volume and product rate and mix[115]. - The company recorded 56 million in unallocated corporate expenses in Q3 fiscal 2025, down from 64millioninthesameperiodinfiscal2024,reflectingadecreaseincertaincompensationandbenefit−relatedexpenses[160].TaxandEarnings−TheeffectivetaxrateforQ3fiscal2025was19.864 million in the same period in fiscal 2024, reflecting a decrease in certain compensation and benefit-related expenses[160]. Tax and Earnings - The effective tax rate for Q3 fiscal 2025 was 19.8%, up from 18.5% in the same period last year[104][105]. - After-tax earnings from joint ventures decreased to 14 million in Q3 fiscal 2025, down from 18millioninthesameperiodlastyear[106].−After−taxearningsfromjointventuresdecreasedto18 million in the same period last year[106]. - After-tax earnings from joint ventures decreased to 64 million in the nine-month period ended February 23, 2025, down from 66millioninthesameperiodlastyear[121].−Theeffectivetaxrateincreasedto20.566 million in the same period last year[121]. - The effective tax rate increased to 20.5% in the nine-month period ended February 23, 2025, compared to 19.5% in the same period last year[120]. - Adjusted effective income tax rate for the quarter ended February 23, 2025, was reported at 21.0%[212]. Divestitures and Gains - A divestiture gain of 96 million was recorded in Q3 fiscal 2025 related to the sale of the Canada yogurt business[101]. - Divestiture gain of 96millionrelatedtothesaleoftheCanadayogurtbusinessinthenine−monthperiodendedFebruary23,2025[117].−ThecompanyreportedadivestituregainrelatedtothesaleofitsCanadayogurtbusinessinfiscal2025[182].CashFlowandInvestments−Cashprovidedbyoperationswas96 million related to the sale of the Canada yogurt business in the nine-month period ended February 23, 2025[117]. - The company reported a divestiture gain related to the sale of its Canada yogurt business in fiscal 2025[182]. Cash Flow and Investments - Cash provided by operations was 2,307 million in the nine-month period ended February 23, 2025, compared to 2,439millioninthesameperiodlastyear,reflectinga2,439 million in the same period last year, reflecting a 132 million decrease[162]. - Cash used by investing activities was 1,579millioninthenine−monthperiodendedFebruary23,2025,comparedto1,579 million in the nine-month period ended February 23, 2025, compared to 508 million in the same period in fiscal 2024, including the acquisition of Whitebridge Pet Brands for 1,410million[163].−Cashusedbyfinancingactivitieswas1,410 million[163]. - Cash used by financing activities was 610 million in the nine-month period ended February 23, 2025, compared to 1,928millioninthesameperiodinfiscal2024,with1,928 million in the same period in fiscal 2024, with 902 million spent on common stock purchases[164]. Debt and Financial Position - The company had 1,941millionoflong−termdebtmaturinginthenext12months,including1,941 million of long-term debt maturing in the next 12 months, including 800 million of fixed-rate notes due April 17, 2025[168]. - As of February 23, 2025, the company had 404millionofcashandcashequivalentsinforeignjurisdictions,withplanstorepatriatefundswithoutincurringfurtherU.S.incometaxliability[165].RegulatoryChanges−TheFASBissuedASU2023−09requiringenhancedincometaxdisclosureseffectiveforfiscal2026,withearlyadoptionpermitted[176].−ASU2023−07mandatesenhancedsegmentdisclosureseffectiveforfiscal2025andfiscal2026,withretrospectiveapplicationrequired[177].SegmentPerformance−Internationalsegmentoperatingprofitdecreased39404 million of cash and cash equivalents in foreign jurisdictions, with plans to repatriate funds without incurring further U.S. income tax liability[165]. Regulatory Changes - The FASB issued ASU 2023-09 requiring enhanced income tax disclosures effective for fiscal 2026, with early adoption permitted[176]. - ASU 2023-07 mandates enhanced segment disclosures effective for fiscal 2025 and fiscal 2026, with retrospective application required[177]. Segment Performance - International segment operating profit decreased 39% to 63 million in the nine-month period ended February 23, 2025, compared to $103 million in the same period last year[142]. - North America Retail organic net sales decreased 2% in the nine-month period ended February 23, 2025, compared to the same period in fiscal 2024[130]. - North America Retail segment's operating profit declined by 14% for the quarter ended February 23, 2025, with no impact from foreign currency exchange[210]. - North America Pet segment's operating profit dropped by 20% for the quarter ended February 23, 2025, with no foreign currency impact[210]. - North America Foodservice segment's operating profit increased by 1% for the quarter ended February 23, 2025, with no foreign currency impact[210]. - The North America Pet segment showed a 6% increase in operating profit for the nine-month period ended February 23, 2025[210].