General Mills Reports Higher Q3 Profit

NEW YORK - Mar 23/06 - SNS -- General Mills, Inc. reported net earnings of U.S. $246 million on sales of $2,860 million for the third quarter ending February 26, compared to a net of $230 million on sales of $2,772 million during the same three months period last year.

This lifted net earnings for the first nine months of the current fiscal year to $868 million on sales of $8,795 million, compared to a net of $780 million on sales of $8,525 million through the end of the third quarter of the previous fiscal year.

Net sales for General Mills' domestic retail operations grew 3% in the third quarter to $1.99 billion, driven by a 3% unit volume increase. Operating profits totaled $420 million, matching prior-year results.

Net sales for the Yoplait division grew 9% over last year's third quarter. Big G cereal net sales grew 5% from last year's third quarter results when merchandised price increases resulted in a decline in net sales. Baking Products net sales grew 12%, reflecting good performance during the holiday baking season. Net sales for the Snacks division grew 4% led by continued good growth on Nature Valley granola bars. Net sales for Pillsbury USA and the Meals division each grew 1% in the period.

Through the first nine months of 2006, net sales for the U.S. Retail segment were up 3% to $6.13 billion, reflecting 2% volume growth and net price realization. Segment operating profit grew 2% to $1.37 billion.

Net sales for the company's consolidated international businesses grew 3% in the third quarter to $444 million. Unit volume grew 4%. Two points of growth from pricing and mix were more than offset by the negative impact of foreign exchange in the quarter. Operating profit grew to $37 million, up 16% from $32 million last year.

Through the first nine months, net sales for General Mills' consolidated international businesses were up 7% to $1.36 billion. Operating profit increased 32% to $154 million.

Third-quarter net sales for General Mills' Bakeries and Foodservice segment grew 3% to $424 million, reflecting net price realization. Unit volume matched last year's third quarter. Segment operating profit decreased 8% due to higher input costs.

Through the first nine months of the fiscal year, net sales for the Bakeries and Foodservice segment were up 1% to $1.31 billion. Operating profit rose 7% to $101 million.

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