Key Takeaways from General Mills’ (GIS) Q4 2024 Earnings Report

Shares of General Mills, Inc. (NYSE: GIS) fell more than 4% on Wednesday after the company reported mixed results for the fourth quarter of 2024. Earnings topped estimates and revenue was below expectations. The company’s stock has fallen 7% over the past three months. Here are the main takeaways from the earnings report:

Mixed results

In the fourth quarter of 2024, General Mills net sales fell 6% year-over-year to $4.71 billion, missing estimates of $4.86 billion. The revenue decline was due to unfavorable net price realization and mix, as well as lower sterling volumes. Organic sales decreased by 6%. GAAP earnings per share decreased 5% to $0.98. Adjusted earnings per share fell 10% to $1.01, but beat the consensus target of $0.99.

Business performance

In the fourth quarter, General Mills reported declining sales in all of its segments except Foodservice. Sales in the Retail, Pet and International segments in North America were negatively impacted by unfavorable pricing and product mix. In the North America Foodservice segment, sales increased 4%, driven by growth in sales of breads, cereals and frozen cookies.

GIS continues to invest in its brands and work to improve taste and introduce new flavors to some of its largest brands and products. It also focuses on providing customers with healthy and convenient options through product innovation. This will continue to be a priority for the company in fiscal year 2025 as well.

As mentioned in its report, the next priority for GIS is to restore growth to the Pet segment. In the fourth quarter, sales in the Pet segment decreased by 8%. The company believes that the trend of humanizing pets will drive the category’s growth in the long run. It continues to invest in product and packaging innovations, as well as providing offers at optimal prices in this segment.

Perspectives

Looking ahead to fiscal year 2025, General Mills anticipates an uncertain macroeconomic environment in its core markets. Still, the company expects category volumes to gradually improve throughout the year. It also plans to drive organic sales growth through investments in its leading brands that will help increase household penetration and market share.

General Mills expects organic sales growth to range from flat to 1% in fiscal year 2025. Adjusted EPS is expected to be between 1% and 1% on a constant currency basis compared to a base of $4.52 earned in fiscal 2024.