General Mills Profits Drop

NEW YORK - Jun 29/06 - SNS -- General Mills reported net earnings of U.S. $222 million on sales of $2,845 million for the fourth quarter ending May 28, compared to a net of $460 million on sales of $2,719 million during the same 13-week period of the prior fiscal year.

This lifted net earnings for the entire 2006 fiscal year to $1,090 million on sales of $11,640 million, down from a net of $1,240 million on sales of $11,244 million during the 2005 fiscal year.

General Mills noted net earnings and diluted EPS were below the prior year's reported results, which included a $284 million after-tax gain from the divestitures of Lloyd's refrigerated meats and the company's interest in a European snacks joint venture (SVE). However, the 2006 EPS results exceeded the company's target range, and represented good growth over prior-year results excluding the one-time gain.

Net sales for General Mills' domestic retail operations grew 3% in 2006 to exceed $8.0 billion, with unit volume up 2% for the year. Segment operating profits grew slightly faster than sales to reach nearly $1.8 billion.

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