filings.toolsGeneral Mills 10-Q 2025-02-23
Filed 2025-03-19. 7 sections, 135K characters. Original on sec.gov · Markdown · JSON
Cover and table of contents
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
10-Q
(Mark One)
☑
QUARTERLY
REPORT
PURSUANT
TO
SECTION
OR
15(d)
OF
THE
SECURITIES
EXCHANGE
ACT
OF
1934
FOR THE QUARTERLY
PERIOD ENDED
FEBRUARY 23, 2025
☐
TRANSITION
REPORT
PURSUANT
TO
SECTION
OR
15(d)
OF
THE
SECURITIES
EXCHANGE
ACT
OF
1934
FOR THE TRANSITION PERIOD FROM
TO
Commission file number:
001-01185
GENERAL MILLS, INC.
(Exact name of registrant as specified in its charter)
Delaware
41-0274440
(State or other jurisdiction of
(I.R.S. Employer
incorporation or organization)
Identification No.)
Number One General Mills Boulevard
Minneapolis
,
Minnesota
55426
(Address of principal executive offices)
(Zip Code)
(763)
764-7600
(Registrant’s telephone number,
including area code)
Securities registered pursuant to Section 12(b) of the Act:
Title of each class
Trading Symbol(s)
Name of each exchange
on which registered
Common Stock, $.10 par value
GIS
New York Stock Exchange
0.125% Notes due 2025
GIS 25A
New York Stock Exchange
0.450% Notes due 2026
GIS 26
New York Stock Exchange
1.500% Notes due 2027
GIS 27
New York Stock Exchange
3.907% Notes due 2029
GIS 29
New York Stock Exchange
3.650% Notes due 2030
GIS 30A
New York Stock Exchange
3.850% Notes due 2034
GIS 34
New York Stock Exchange
Indicate
by
check
mark
whether
the
registrant
(1)
has
filed
all
reports
required
to
be
filed
by
Section
or
15(d)
of
the
Securities
Exchange Act of 1934
during the preceding 12
months (or for such shorter
period that the registrant
was required to file such
reports),
and (2) has been subject to such filing requirements for the past 90 days.
Yes
☑
No
☐
Indicate
by
check
mark
whether
the
registrant
has
submitted
electronically
every
Interactive
Data
File
required
to
be
submitted
pursuant to Rule 405
of Regulation S-T (§
232.405 of this chapter) during
the preceding 12 months (or
for such shorter period that
the
registrant was required to submit such files).
Yes
☑
No
☐
Indicate
by
check
mark
whether
the
registrant
is
a
large
accelerated
filer,
an
accelerated
filer,
a
non-accelerated
filer,
a
smaller
reporting
company,
or
an
emerging
growth
company.
See
the
definitions
of
“large
accelerated
filer,”
“accelerated
filer,”
“smaller
reporting company,” and
“emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer
☑
Accelerated filer
☐
Non-accelerated filer
☐
Smaller reporting company
☐
Emerging growth company
☐
If
an
emerging
growth
company,
indicate
by
check
mark
if
the
registrant
has
elected
not
to
use
the
extended
transition
period
for
complying with any new or revised financial accounting standards provided
pursuant to Section 13(a) of the Exchange Act.
☐
Indicate by check mark whether the registrant is a shell company (as defined
in Rule 12b-2 of the Exchange Act).
Yes
☐
No
☑
Number
of
shares
of
Common
Stock
outstanding
as
of
March
12,
2025:
547,600,534
(excluding
207,012,794
shares
held
in
the
treasury).
General Mills, Inc.
Table of Contents
Page
PART I – Financial Information
23, 2025 and February 25, 2024
Consolidated Balance Sheets as of February 23, 2025 and May 26, 2024
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations
Item 3. Quantitative and Qualitative Disclosures About Market Risk
Item 4. Controls and Procedures
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
PART
I.
FINANCIAL INFORMATION
Item 1. Financial Statements.
Financial Statements.
Consolidated Statements of Earnings
GENERAL MILLS, INC. AND SUBSIDIARIES
(Unaudited) (In Millions, Except per Share Data)
Quarter Ended
Nine-Month Period Ended
Feb. 23, 2025
Feb. 25, 2024
Feb. 23, 2025
Feb. 25, 2024
Net sales
$
4,842.2
$
5,099.2
$
14,930.4
$
15,143.3
Cost of sales
3,203.1
3,391.8
9,671.4
9,899.5
Selling, general, and administrative expenses
844.4
790.9
2,551.5
2,460.7
Divestiture gain
(95.9)
-
(95.9)
-
Restructuring, impairment, and other exit (recoveries) costs
(0.8)
5.8
2.6
130.6
Operating profit
891.4
910.7
2,800.8
2,652.5
Benefit plan non-service income
(13.9)
(18.6)
(41.6)
(55.7)
Interest, net
136.3
121.7
384.5
356.5
Earnings before income taxes and after-tax earnings
from
joint ventures
769.0
807.6
2,457.9
2,351.7
Income taxes
152.4
149.3
504.6
458.5
After-tax earnings from joint ventures
14.4
18.0
63.6
65.7
Net earnings, including earnings attributable to
noncontrolling interests
631.0
676.3
2,016.9
1,958.9
Net earnings attributable to noncontrolling interests
5.4
6.2
15.7
19.8
Net earnings attributable to General Mills
$
625.6
$
670.1
$
2,001.2
$
1,939.1
Earnings per share – basic
$
1.14
$
1.18
$
3.60
$
3.35
Earnings per share – diluted
$
1.12
$
1.17
$
3.57
$
3.33
See accompanying notes to consolidated financial statements.
Consolidated Statements of Comprehensive Income
GENERAL MILLS, INC. AND SUBSIDIARIES
(Unaudited) (In Millions)
Quarter Ended
Nine-Month Period Ended
Feb. 23, 2025
Feb. 25, 2024
Feb. 23, 2025
Feb. 25, 2024
Net earnings, including earnings attributable to
noncontrolling interests
$
631.0
$
676.3
$
2,016.9
$
1,958.9
Other comprehensive income (loss), net of tax:
Foreign currency translation
6.2
2.4
(26.9)
(38.0)
Other fair value changes:
Hedge derivatives
1.1
(6.9)
4.3
(7.3)
Reclassification to earnings:
Foreign currency translation
33.9
-
33.9
-
Hedge derivatives
(3.0)
(0.1)
(1.3)
(2.3)
Amortization of losses and prior service costs
11.2
9.1
34.5
27.4
Other comprehensive income (loss), net of tax
49.4
4.5
44.5
(20.2)
Total comprehensive
income
680.4
680.8
2,061.4
1,938.7
Comprehensive income attributable to noncontrolling
interests
5.4
6.0
14.9
20.0
Comprehensive income attributable to General Mills
$
675.0
$
674.8
$
2,046.5
$
1,918.7
See accompanying notes to consolidated financial statements.
Consolidated Balance Sheets
GENERAL MILLS, INC. AND SUBSIDIARIES
(In Millions, Except Par Value)
Feb. 23, 2025
May 26, 2024
(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents
$
521.3
$
418.0
Receivables
1,791.0
1,696.2
Inventories
1,811.6
1,898.2
Prepaid expenses and other current assets
401.9
568.5
Assets held for sale
730.2
-
Total current
assets
5,256.0
4,580.9
Land, buildings, and equipment
3,460.5
3,863.9
Goodwill
15,518.7
14,750.7
Other intangible assets
7,059.0
6,979.9
Other assets
1,412.0
1,294.5
Total assets
$
32,706.2
$
31,469.9
LIABILITIES AND EQUITY
Current liabilities:
Accounts payable
$
3,692.3
$
3,987.8
Current portion of long-term debt
1,941.0
1,614.1
Notes payable
406.7
11.8
Other current liabilities
1,815.7
1,419.4
Liabilities held for sale
20.5
-
Total current
liabilities
7,876.2
7,033.1
Long-term debt
11,839.6
11,304.2
Deferred income taxes
2,263.9
2,200.6
Other liabilities
1,213.9
1,283.5
Total liabilities
23,193.6
21,821.4
Stockholders’ equity:
Common stock,
754.6
shares issued, $
0.10
par value
75.5
75.5
Additional paid-in capital
1,194.9
1,227.0
Retained earnings
21,636.0
20,971.8
Common stock in treasury,
at cost, shares of
207.1
and
195.5
(11,168.8)
(10,357.9)
Accumulated other comprehensive loss
(2,474.4)
(2,519.7)
Total stockholders’
equity
9,263.2
9,396.7
Noncontrolling interests
249.4
251.8
Total equity
9,512.6
9,648.5
Total liabilities and equity
$
32,706.2
$
31,469.9
See accompanying notes to consolidated financial statements.
Consolidated Statements of Total
Equity
GENERAL MILLS, INC. AND SUBSIDIARIES
(Unaudited) (In Millions, Except per Share Data)
Quarter Ended
Feb. 23, 2025
Feb. 25, 2024
Shares
Amount
Shares
Amount
Total equity,
beginning balance
$
9,449.2
$
9,631.9
Common stock,
billion shares authorized, $
0.10
par value
754.6
75.5
754.6
75.5
Additional paid-in capital:
Beginning balance
1,182.0
1,201.8
Stock compensation plans
(9.6)
(11.1)
Unearned compensation related to stock unit awards
2.3
1.8
Earned compensation
20.2
17.8
Ending balance
1,194.9
1,210.3
Retained earnings:
Beginning balance
21,340.3
20,080.9
Net earnings attributable to General Mills
625.6
670.1
Cash dividends declared ($
0.60
and $
0.59
per share)
(329.9)
(334.3)
Ending balance
21,636.0
20,416.7
Common stock in treasury:
Beginning balance
(202.4)
(10,873.3)
(185.7)
(9,677.4)
Shares purchased, including excise tax of $
2.9
and
$
2.8
million
(4.8)
(304.4)
(4.7)
(303.1)
Stock compensation plans
0.1
8.9
0.3
12.1
Ending balance
(207.1)
(11,168.8)
(190.1)
(9,968.4)
Accumulated other comprehensive loss:
Beginning balance
(2,523.8)
(2,302.0)
Comprehensive income
49.4
4.7
Ending balance
(2,474.4)
(2,297.3)
Noncontrolling interests:
Beginning balance
248.5
253.1
Comprehensive income
5.4
6.0
Distributions to noncontrolling interest holders
(4.5)
(4.6)
Ending balance
249.4
254.5
Total equity,
ending balance
$
9,512.6
$
9,691.3
See accompanying notes to consolidated financial statements.
Consolidated Statements of Total
Equity
GENERAL MILLS, INC. AND SUBSIDIARIES
(Unaudited) (In Millions, Except per Share Data)
Nine-Month Period Ended
Feb. 23, 2025
Feb. 25, 2024
Shares
Amount
Shares
Amount
Total equity,
beginning balance
$
9,648.5
$
10,700.0
Common stock,
billion shares authorized, $
0.10
par value
754.6
75.5
754.6
75.5
Additional paid-in capital:
Beginning balance
1,227.0
1,222.4
Stock compensation plans
(18.9)
(10.3)
Unearned compensation related to stock unit awards
(79.4)
(78.1)
Earned compensation
66.2
76.3
Ending balance
1,194.9
1,210.3
Retained earnings:
Beginning balance
20,971.8
19,838.6
Net earnings attributable to General Mills
2,001.2
1,939.1
Cash dividends declared ($
2.40
and $
2.36
per share)
(1,337.0)
(1,361.0)
Ending balance
21,636.0
20,416.7
Common stock in treasury:
Beginning balance
(195.5)
(10,357.9)
(168.0)
(8,410.0)
Shares purchased, including excise tax of $
7.7
and
$
15.0
million
(13.5)
(909.6)
(23.5)
(1,616.6)
Stock compensation plans
1.9
98.7
1.4
58.2
Ending balance
(207.1)
(11,168.8)
(190.1)
(9,968.4)
Accumulated other comprehensive loss:
Beginning balance
(2,519.7)
(2,276.9)
Comprehensive income (loss)
45.3
(20.4)
Ending balance
(2,474.4)
(2,297.3)
Noncontrolling interests:
Beginning balance
251.8
250.4
Comprehensive income
14.9
20.0
Distributions to noncontrolling interest holders
(17.3)
(16.6)
Change in ownership interest
-
0.7
Ending balance
249.4
254.5
Total equity,
ending balance
$
9,512.6
$
9,691.3
See accompanying notes to consolidated financial statements.
Consolidated Statements of Cash Flows
GENERAL MILLS, INC. AND SUBSIDIARIES
(Unaudited) (In Millions)
Nine-Month Period Ended
Feb. 23, 2025
Feb. 25, 2024
Cash Flows - Operating Activities
Net earnings, including earnings attributable to noncontrolling interests
$
2,016.9
$
1,958.9
Adjustments to reconcile net earnings to net cash provided by operating activities:
Depreciation and amortization
403.4
412.2
After-tax earnings from joint ventures
(63.6)
(65.7)
Distributions of earnings from joint ventures
30.9
31.4
Stock-based compensation
67.1
76.7
Deferred income taxes
(13.5)
(85.5)
Pension and other postretirement benefit plan contributions
(23.0)
(20.0)
Pension and other postretirement benefit plan costs
(9.9)
(20.2)
Divestiture gain
(95.9)
-
Restructuring, impairment, and other exit (recoveries) costs
(3.4)
119.7
Changes in current assets and liabilities, excluding the effects of
acquisitions and divestitures
55.8
(9.6)
Other, net
(58.2)
41.0
Net cash provided by operating activities
2,306.6
2,438.9
Cash Flows - Investing Activities
Purchases of land, buildings, and equipment
(405.1)
(485.6)
Acquisition, net of cash acquired
(1,417.3)
(25.5)
Proceeds from divestiture
241.8
-
Investments in affiliates, net
6.6
(1.5)
Proceeds from disposal of land, buildings, and equipment
1.0
0.2
Other, net
(5.6)
4.8
Net cash used by investing activities
(1,578.6)
(507.6)
Cash Flows - Financing Activities
Change in notes payable
397.0
654.5
Issuance of long-term debt
1,500.0
1,000.0
Payment of long-term debt
(500.0)
(900.0)
Proceeds from common stock issued on exercised options
38.4
11.1
Purchases of common stock for treasury
(901.9)
(1,601.6)
Dividends paid
(1,008.4)
(1,028.0)
Distributions to noncontrolling interest holders
(17.3)
(16.6)
Other, net
(117.5)
(47.0)
Net cash used by financing activities
(609.7)
(1,927.6)
Effect of exchange rate changes on cash and cash equivalents
(15.0)
(0.6)
Increase in cash and cash equivalents
103.3
3.1
Cash and cash equivalents - beginning of year
418.0
585.5
Cash and cash equivalents - end of period
$
521.3
$
588.6
Cash Flows from changes in current assets and liabilities, excluding
the effects of
acquisitions and divestitures:
Receivables
$
(95.7)
$
(83.8)
Inventories
59.5
347.8
Prepaid expenses and other current assets
139.6
269.4
Accounts payable
(136.7)
(543.7)
Other current liabilities
89.1
0.7
Changes in current assets and liabilities
$
55.8
$
(9.6)
See accompanying notes to consolidated financial statements.
GENERAL MILLS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED
FINANCIAL STATEMENTS
(Unaudited)
(1) Background
The accompanying
Consolidated Financial
Statements of
General Mills,
Inc. (we,
us, our,
General Mills,
or the Company)
have been
prepared in
accordance with
accounting principles
generally accepted
in the
United States
(GAAP) for
interim financial
information
and with
the rules
and regulations
for reporting
on Form
10-Q. Accordingly,
they do
not include
certain information
and disclosures
required
for
comprehensive
financial
statements.
In
the
opinion
of
management,
all
adjustments
considered
necessary
for
a
fair
presentation have
been included
and are
of a
normal recurring
nature, including
the elimination
of all
intercompany transactions
and
any
noncontrolling
interests’
share
of
those
transactions.
Operating
results
for
the
fiscal
quarter
ended
February
23,
2025,
are
not
necessarily indicative of the results that may be expected for the fiscal year ending
May 25, 2025.
These
statements
should
be
read
in
conjunction
with
the
Consolidated
Financial
Statements
and
footnotes
included
in
our
Annual
Report on Form
10-K for the fiscal
year ended May
26, 2024. The
accounting policies used
in preparing these
Consolidated Financial
Statements are the same as those described in Note 2 to the Consolidated Financial
Statements in that Form 10-K.
Certain terms used throughout this report are defined in the “Glossary” section
below.
(2) Acquisitions and Divestitures
During
the
third
quarter
of
fiscal
2025,
we
acquired
NX
Pet
Holding,
Inc.,
representing
Whitebridge
Pet
Brands’
North
American
premium cat feeding
and pet treating
business, for a
purchase price of
$
1.4
billion (Whitebridge Pet
Brands acquisition). We
financed
the
transaction
with
cash
on
hand.
We
consolidated
Whitebridge
Pet
Brands
into
our
Consolidated
Balance
Sheets
and
recorded
goodwill
of
$
1,087.4
million,
an
indefinite-lived
intangible
asset
for
the
Tiki
Pets
brand
totaling
$
289.0
million,
and
a
finite-lived
customer relationship
asset of $
31.0
million. The goodwill
is included in
the North America
Pet segment and
is not deductible
for tax
purposes. The pro forma
effects of this acquisition were
not material. We
have conducted a preliminary assessment
of the fair value of
the acquired
assets and
liabilities of
the business
and we
are continuing
our review
of these
items during
the measurement
period. If
new
information
is
obtained
about
facts
and
circumstances
that
existed
at
the
acquisition
date,
the
acquisition
accounting
will
be
revised
to
reflect
the
resulting
adjustments
to
current
estimates
of
those
items.
The
consolidated
results
are
reported
in
our
North
America Pet operating segment on a one-month lag.
During
the
second
quarter
of
fiscal
2025,
we
entered
into
definitive
agreements
to
sell
our
North
American
yogurt
businesses
to
affiliates of Groupe Lactalis S.A. (Lactalis) and
Sodiaal International (Sodiaal) for approximately $
2.1
billion. During the third quarter
of
fiscal
2025,
we
completed
the
sale
of
our
Canada
yogurt
business
to
Sodiaal
and
recorded
a
pre-tax
gain
of
$
95.9
million.
We
expect
to
close
the
sale of
our
United
States yog
urt
business
to
Lactalis
in
calendar
year
2025,
subject
to
regulatory
approvals
and
other customary
closing conditions.
We
have classified
all assets
and liabilities
associated
with our
United States
yogurt business
as
held for sale in our Consolidated Balance Sheets as of February 23, 2025.
The components of assets held for sale and liabilities held for sale are as follows:
In Millions
Feb. 23, 2025
Inventories
$
52.4
Prepaid expenses and other current assets
15.1
Land, buildings, and equipment
224.3
Goodwill
252.6
Other intangible assets
160.7
Other assets
25.1
Assets held for sale
$
730.2
Other current liabilities
$
8.8
Other liabilities
11.7
Liabilities held for sale
$
20.5
During the fourth
quarter of fiscal 2024,
we acquired a pet
food business in Europe
for a purchase price
of $
434.1
million, net of
cash
acquired.
During
the
first
quarter
of
fiscal
2025,
we
paid
$
7.7
million
related
to
a
purchase
price
holdback
after
certain
closing
conditions
were
met.
We
financed
the
transaction
with
cash
on
hand.
We
consolidated
the
business
into
our
Consolidated
Balance
Sheets
and
recorded
goodwill
of
$
317.5
million,
an
indefinite-lived
brand
intangible
asset
of
$
118.4
million
and
a
finite-lived
customer
relationship
asset
of
$
14.2
million.
The
goodwill
is
included
in
the
International
segment
and
is
not
deductible
for
tax
purposes. The pro forma effects
of this acquisition were not
material. We
have conducted a preliminary assessment
of the fair value of
the acquired
assets and
liabilities of
the business
and we
are continuing
our review
of these
items during
the measurement
period. If
new
information
is
obtained
about
facts
and
circumstances
that
existed
at
the
acquisition
date,
the
acquisition
accounting
will
be
revised
to
reflect
the
resulting
adjustments
to
current
estimates
of
those
items.
The
consolidated
results
are
reported
in
our
International operating segment on a one-month lag beginning in
fiscal 2025.
(3) Restructuring, Impairment, and Other Exit Costs
Restructuring and impairment charges were
as follows:
Quarter Ended
Nine-Month Period Ended
In Millions
Feb. 23, 2025
Feb. 25, 2024
Feb. 23, 2025
Feb. 25, 2024
(Recoveries) charges associated with restructuring actions
previously announced
$
(0.6)
$
5.9
$
3.6
$
30.5
Goodwill impairment
-
-
-
117.1
Total
$
(0.6)
$
5.9
$
3.6
$
147.6
In the
nine-month period
ended February
23, 2025,
we did
not undertake
any new
restructuring actions.
We
recorded a
$
0.6
million
net
recovery
of restructuring
charges
in
the third
quarter of
fiscal
2025
and
$
3.6
million
of restructuring
charges
in
the nine-month
period
ended
February
23,
2025,
related
to
restructuring
actions
previously
announced.
We
recorded
$
5.9
million
of
restructuring
charges
in
the
third
quarter
of
fiscal
2024
and
$
30.5
million
of
restructuring
charges
in
the
nine-month
period
ended
February
25,
2024, related to restructuring actions previously announced.
We expect these
actions to be completed by the end of fiscal 2026.
We
paid
net
$
7.0
million
of
cash
in
the
nine-month
period
ended
February
23,
2025,
related
to
restructuring
actions.
We
paid
net
$
27.9
million of cash in the same period of fiscal 2024.
In the second
quarter of fiscal
2024, we recorded
a $
117.1
million non-cash goodwill
impairment charge
related to our Latin
America
reporting unit. See Note 4 for additional information.
Restructuring and
impairment (recoveries)
charges and
project-related costs
are recorded
in our
Consolidated Statements
of Earnings
as follows:
Quarter Ended
Nine-Month Period Ended
In Millions
Feb. 23, 2025
Feb. 25, 2024
Feb. 23, 2025
Feb. 25, 2024
Restructuring, impairment, and other exit (recoveries) costs
$
(0.8)
$
5.8
$
2.6
$
130.6
Cost of sales
0.2
0.1
1.0
17.0
Total restructuring
and impairment (recoveries) charges
$
(0.6)
$
5.9
$
3.6
$
147.6
Project-related costs classified in cost of sales
$
0.2
$
0.5
$
0.4
$
1.6
(4) Goodwill and Other Intangible Assets
The components of goodwill and other intangible assets are as follows:
In Millions
Feb. 23, 2025
May 26, 2024
Goodwill
$
15,518.7
$
14,750.7
Other intangible assets:
Intangible assets not subject to amortization:
Brands and other indefinite-lived intangibles
6,792.1
6,728.6
Intangible assets subject to amortization:
Customer relationships and other finite-lived intangibles
418.4
402.2
Less accumulated amortization
(151.5)
(150.9)
Intangible assets subject to amortization, net
266.9
251.3
Other intangible assets
7,059.0
6,979.9
Total
$
22,577.7
$
21,730.6
Based on the
carrying value of
finite-lived intangible assets
as of February
23, 2025, annual amortization
expense for each of
the next
five fiscal years is estimated to be approximately $
million.
The changes in the carrying amount of goodwill during the nine-month period
ended February 23, 2025, were as follows:
In Millions
North
America
Retail
North
America
Pet
North
America
Foodservice
International
(a)
Corporate
and Joint
Ventures
Total
Balance as of May 26, 2024
$
6,541.9
$
6,062.8
$
805.5
$
917.1
$
423.4
$
14,750.7
Acquisition
-
1,087.4
-
-
-
1,087.4
Divestiture
(14.6)
-
-
-
-
(14.6)
Reclassified to assets held
for sale
(202.6)
-
(50.0)
-
-
(252.6)
Other activity, primarily
foreign currency translation
(4.9)
-
-
(33.1)
(14.2)
(52.2)
Balance as of Feb. 23, 2025
$
6,319.8
$
7,150.2
$
755.5
$
884.0
$
409.2
$
15,518.7
(a)
The carrying amounts of goodwill within the International segment as of
May 26, 2024, and February 23, 2025, were net of
accumulated impairment losses of $
117.1
million. For additional information, see Note 6 to the Consolidated Financial
Statements included in our Annual Report on Form 10-K for the fiscal year
ended May 26, 2024.
The changes in the carrying amount of other intangible assets during the nine-month
period ended February 23, 2025, were as follows:
In Millions
Total
Balance as of May 26, 2024
$
6,979.9
Acquisition
320.0
Divestiture
(44.4)
Reclassified to assets held for sale
(160.7)
Other activity, primarily
foreign currency translation and amortization
(35.8)
Balance as of Feb. 23, 2025
$
7,059.0
Our
annual
goodwill
and
indefinite-lived
intangible
assets
impairment
test
was
performed
on
the
first
day
of
the
second
quarter
of
fiscal
2025,
and
we
determined
there
was
no
impairment
of
our
intangible
assets
as
their
related
fair
values
were
substantially
in
excess of the
carrying values,
except for
the
Uncle Toby’s
brand intangible
asset. In addition,
while having
significant coverage
as of
our
fiscal
2025
assessment
date,
the
Progresso
,
Nudges
,
True
Chews
,
and
Kitano
brand
intangible
assets
had
risk
of
decreasing
coverage. We will continue
to monitor these businesses for potential impairment.
(5) Inventories
The components of inventories were as follows:
In Millions
Feb. 23, 2025
May 26, 2024
Finished goods
$
1,801.5
$
1,827.7
Raw materials and packaging
447.2
500.5
Grain
106.2
111.1
Excess of FIFO over LIFO cost
(543.3)
(541.1)
Total
$
1,811.6
$
1,898.2
In addition, we had $
52.4
million of inventories classified as held for sale as of February 23, 2025.
(6) Risk Management Activities
Many commodities we
use in the
production and distribution
of our products
are exposed to
market price risks.
We
utilize derivatives
to manage price risk for our principal
ingredients and energy costs, including
grains (oats, wheat, and corn), oils
(principally soybean),
dairy products, natural
gas, and diesel fuel.
Our primary objective
when entering into
these derivative contracts
is to achieve
certainty
with
regard
to
the
future
price
of
commodities
purchased
for
use
in
our
supply
chain.
We
manage
our
exposures
through
a
combination of purchase orders, long-term
contracts with suppliers, exchange-traded
futures and options, and over-the-counter
options
and swaps.
We
offset
our exposures
based on
current and
projected market
conditions and
generally seek
to acquire
the inputs
at as
close as possible to or below our planned cost.
We
use derivatives
to manage
our exposure
to changes
in commodity
prices. We
do not
perform the
assessments required
to achieve
hedge
accounting
for
commodity
derivative
positions.
Accordingly,
the
changes
in
the
values
of
these
derivatives
are
recorded
currently in cost of sales in our Consolidated Statements of Earnings.
Although we do
not meet the
criteria for
cash flow hedge
accounting, we believe
that these instruments
are effective
in achieving our
objective of providing certainty
in the future price of commodities purchased
for use in our supply chain.
Accordingly, for
purposes of
measuring
segment
operating
performance,
these
gains
and
losses
are
reported
in
unallocated
corporate
items
outside
of
segment
operating results
until such time
that the exposure
we are managing
affects earnings.
At that time,
we reclassify
the gain or
loss from
unallocated
corporate
items
to
segment
operating
profit,
allowing
our
operating
segments
to
realize
the
economic
effects
of
the
derivative without experiencing any resulting mark-to-market volatility,
which remains in unallocated corporate items.
Unallocated corporate items for the quarters and nine-month periods ended
February 23, 2025, and February 25, 2024, included:
Quarter Ended
Nine-Month Period Ended
In Millions
Feb. 23, 2025
Feb. 25, 2024
Feb. 23, 2025
Feb. 25, 2024
Net gain (loss) on mark-to-market valuation of certain
commodity positions
$
16.0
$
(24.5)
$
(18.3)
$
(34.3)
Net loss on commodity positions reclassified from
unallocated corporate items to segment operating profit
7.3
11.7
43.6
29.5
Net mark-to-market revaluation of certain grain inventories
(0.1)
(12.9)
(1.5)
(1.1)
Net mark-to-market valuation of certain commodity
positions recognized in unallocated corporate items
$
23.2
$
(25.7)
$
23.8
$
(5.9)
As
of
February
23,
2025,
the
net
notional
value
of
commodity
derivatives
was
$
266.2
million,
of
which
$
172.2
million
related
to
agricultural inputs and
$
94.0
million related to
energy inputs. These
contracts relate to
inputs that generally
will be utilized
within the
next
months.
We
also have net
investments in
foreign subsidiaries
that are denominated
in euros. As
of February
23, 2025, we
hedged a portion
of
these investments with €
3,990.4
million of euro-denominated bonds.
During the
second quarter of
fiscal 2025, in
advance of planned
debt financing,
we entered into
$
350.0
million of treasury
locks. The
treasury locks were terminated during the second quarter
of fiscal 2025, in conjunction with the Company’s
issuance of $
750.0
million
of
fixed-rate
notes
due
January 30, 2035
.
Upon
termination,
a
gain
of $
0.1
million
was recognized
in AOCI
and
will be
amortized
through interest expense over the respective term of the debt.
During the
second quarter
of fiscal
2025, we
entered into
a $
750.0
million notional
amount interest
rate swap
to convert
our $
750.0
million of fixed-rate notes due
January 30, 2030
, to a floating rate.
During the second quarter of fiscal 2025, our
$
500.0
million notional amount interest rate swap to convert
our $
500.0
million of fixed-
rate notes due
November 18, 2025
to a floating
rate was called
by the counterparty
prior to the
maturity date. The
previously existing
swap was designated
as a fair value
hedge, and concurrent
with the swap
being called, we
ceased recording
market value adjustments
to the associated hedged debt.
During the
third quarter
of fiscal 2024,
in advance
of our
$
500.0
million debt
issuance, we
entered into
and settled
$
250.0
million of
treasury locks, resulting in a gain of $
0.3
million.
The
fair
values
of
the
derivative
positions
used
in
our
risk
management
activities
and
other
assets
recorded
at
fair
value
were
not
material as of February 23, 2025,
and were Level 1 or Level 2 assets and
liabilities in the fair value hierarchy.
We did
not significantly
change our valuation techniques from prior periods.
We
offer
certain
suppliers
access
to
third-party
services
that
allow
them
to
view
our
scheduled
payments
online.
The
third-party
services also
allow suppliers
to finance
advances on
our scheduled
payments at
the sole
discretion of
the supplier
and the third
party.
We
have no
economic interest
in these
financing arrangements
and no
direct relationship
with the
suppliers, the
third parties,
or any
financial institutions
concerning these
services, including
not providing
any form
of guarantee
and not
pledging assets
as security
to
the third
parties or
financial institutions.
All of
our accounts
payable remain
as obligations
to our
suppliers as
stated in
our supplier
agreements. As of February
23, 2025, $
1,424.9
million of our total accounts
payable were payable to
suppliers who utilize these third-
party services.
As of
May 26,
2024, $
1,404.4
million of
our total
accounts payable
were payable
to suppliers
who utilize
these third-
party services.
(7) Debt
The components of notes payable were as follows:
Feb. 23, 2025
May 26, 2024
In Millions
Notes Payable
Weighted-
Average
Interest Rate
Notes Payable
Weighted-
Average
Interest Rate
U.S. commercial paper
$
403.0
4.4
%
$
-
-
%
Financial institutions
3.7
4.3
11.8
8.8
Total
$
406.7
4.4
%
$
11.8
8.8
%
To ensure availability
of funds, we maintain bank credit lines and have commercial paper programs
available to us in the United States
and Europe.
The following table details the fee-paid committed and uncommitted credit
lines we had available as of February 23, 2025:
In Billions
Facility
Amount
Borrowed
Amount
Committed credit facility expiring October 2029
$
2.7
$
-
Uncommitted credit facilities
0.7
-
Total committed
and uncommitted credit facilities
$
3.4
$
-
In
the
second
quarter
of fiscal
2025,
we
entered
into
a
$
2.7
billion
fee-paid
committed
credit
facility
that
is
scheduled
to
expire
in
October 2029
. Concurrent with the execution of this credit facility,
we terminated our existing $
2.7
billion credit facility.
The
credit
facilities
contain
covenants,
including
a
requirement
to
maintain
a
fixed
charge
coverage
ratio
of
at
least
2.5
times.
We
were in compliance with all credit facility covenants as of February 23, 2025.
Long-Term
Debt
The
fair
values
and
carrying
amounts
of
long-term
debt,
including
the
current
portion,
were
$
13,233.5
and
$
13,780.6
million,
respectively,
as of
February
23,
The
fair value
of long-term
debt
was estimated
using
market quotations
and
discounted
cash
flows based
on our
current incremental
borrowing rates
for similar
types of
instruments. Long
-term debt
is a
Level 2
liability in
the
fair value hierarchy.
In the third
quarter of fiscal 2025,
we repaid $
500.0
million of
5.241
percent fixed-rate notes
due
November 18, 2025
, using proceeds
from the issuance of commercial paper.
In the second quarter of
fiscal 2025, we issued $
750.0
million of
4.875
percent fixed-rate notes due
January 30, 2030
. We
used the net
proceeds to fund the Whitebridge Pet Brands acquisition.
In the second
quarter of fiscal
2025, we issued
$
750.0
million of
5.25
percent fixed-rate notes
due
January 30, 2035
. We
used the net
proceeds to fund the Whitebridge Pet Brands acquisition.
In the
second quarter
of fiscal
2025, we
issued €
250.0
million of
floating-rate notes
due
April 22, 2026
. We
used the
net proceeds
to
repay €
250.0
million of floating-rate notes due
November 8, 2024
.
In the
second quarter
of fiscal
2025, we
issued €
500.0
million of
floating-rate notes
due
October 22, 2026
. We
used the
net proceeds
to repay €
500.0
million of floating-rate notes due
November 8, 2024
.
In the
fourth quarter
of fiscal 2024,
we issued €
500.0
million of
3.65
percent fixed-rate
notes due
October 23, 2030
. We
used the
net
proceeds for general corporate purposes.
In
the fourth
quarter
of fiscal
2024,
we issued
€
500.0
million
of
3.85
percent
fixed-rate notes
due
April 23, 2034
.
We
used
the net
proceeds for general corporate purposes.
In
the
third
quarter of
fiscal
2024,
we
issued
$
500.0
million
of
4.7
percent
fixed-rate
notes due
January 30, 2027
. We
used
the
net
proceeds to repay $
500.0
million of
3.65
percent fixed-rate notes due
February 15, 2024
.
In the second
quarter of fiscal 2024,
we issued €
250.0
million of floating-rate
notes due
November 8, 2024
. We
used the net proceeds
to repay €
250.0
million of floating-rate notes due
November 10, 2023
.
In the
second quarter
of fiscal
2024, we
issued $
500.0
million of
5.5
percent fixed-rate
notes due
October 17, 2028
. We
used the
net
proceeds to repay $
400.0
million of floating-rate notes due
October 17, 2023
, and for general corporate purposes.
In the first
quarter of fiscal
2024, we issued
€
500.0
million of floating-rate
notes due
November 8, 2024
. We
used the net proceeds
to
repay €
500.0
million of floating-rate notes due
July 27, 2023
.
Certain of
our long-term
debt agreements
contain restrictive
covenants.
As of February 23, 2025, we were in compliance with all of
these covenants.
(8) Noncontrolling Interests
The
third-party
holder
of
the
General
Mills
Cereals,
LLC
(GMC)
Class A
Interests
receives
quarterly
preferred
distributions
from
available net
income based
on the application
of a
floating preferred
return rate
to the
holder’s capital
account balance
established in
the
most
recent
mark-to-market
valuation
(currently
$
251.5
million).
On
June
1,
2024,
the
floating
preferred
return
rate
on
GMC’s
Class A Interests was reset to the sum of the
three-month Term SOFR
plus
basis points. The preferred return rate is adjusted
every
three years
through a negotiated agreement with the Class A Interest holder or through a remarketing
auction.
Our noncontrolling interests contain restrictive covenants. As of February 23, 2025, we were in compliance with all of these
covenants.
(9) Stockholders’ Equity
The following tables provide details of total comprehensive income:
Quarter Ended
Quarter Ended
Feb. 23, 2025
Feb. 25, 2024
General Mills
Noncontrolling
Interests
General Mills
Noncontrolling
Interests
In Millions
Pretax
Tax
Net
Net
Pretax
Tax
Net
Net
Net earnings, including earnings
attributable to noncontrolling interests
$
625.6
$
5.4
$
670.1
$
6.2
Other comprehensive income (loss):
Foreign currency translation
$
2.5
$
3.7
6.2
-
$
10.7
$
(8.1)
2.6
(0.2)
Other fair value changes:
Hedge derivatives
2.3
(1.2)
1.1
-
(8.8)
1.9
(6.9)
-
Reclassification to earnings:
Foreign currency translation (a)
33.9
-
33.9
-
-
-
-
-
Hedge derivatives (b)
(3.7)
0.7
(3.0)
-
(0.3)
0.2
(0.1)
-
Amortization of losses and
prior service costs (c)
14.1
(2.9)
11.2
-
11.5
(2.4)
9.1
-
Other comprehensive income (loss)
$
49.1
$
0.3
49.4
-
$
13.1
$
(8.4)
4.7
(0.2)
Total comprehensive income
$
675.0
$
5.4
$
674.8
$
6.0
(a)
Loss reclassified from AOCI into earnings is reported in divestiture gain.
(b)
Gain reclassified from AOCI into earnings is reported in interest, net for interest rate swaps and in cost of sales and SG&A expenses for foreign exchange contracts.
(c)
Loss reclassified from AOCI into earnings is reported in benefit plan non-service income.
Nine-Month Period Ended
Nine-Month Period Ended
Feb. 23, 2025
Feb. 25, 2024
General Mills
Noncontrolling
Interests
General Mills
Noncontrolling
Interests
In Millions
Pretax
Tax
Net
Net
Pretax
Tax
Net
Net
Net earnings, including earnings
attributable to noncontrolling interests
$
2,001.2
$
15.7
$
1,939.1
$
19.8
Other comprehensive income (loss):
Foreign currency translation
$
9.5
$
(35.6)
(26.1)
(0.8)
$
(43.7)
$
5.5
(38.2)
0.2
Other fair value changes:
Hedge derivatives
6.6
(2.3)
4.3
-
(9.0)
1.7
(7.3)
-
Reclassification to earnings:
Foreign currency translation (a)
33.9
-
33.9
-
-
-
-
-
Hedge derivatives (b)
(2.9)
1.6
(1.3)
-
(5.0)
2.7
(2.3)
-
Amortization of losses and
prior service costs (c)
43.2
(8.7)
34.5
-
34.5
(7.1)
27.4
-
Other comprehensive income (loss)
$
90.3
$
(45.0)
45.3
(0.8)
$
(23.2)
$
2.8
(20.4)
0.2
Total comprehensive income
$
2,046.5
$
14.9
$
1,918.7
$
20.0
(a)
Loss reclassified from AOCI into earnings is reported in divestiture gain.
(b)
Gain reclassified from AOCI into earnings is reported in interest, net for interest rate swaps and in cost of sales and SG&A expenses for foreign exchange contracts.
(c)
Loss reclassified from AOCI into earnings is reported in benefit plan non-service income.
Accumulated other comprehensive loss balances, net of tax effects,
were as follows:
In Millions
Feb. 23, 2025
May 26, 2024
Foreign currency translation adjustments
$
(787.5)
$
(795.3)
Unrealized gain from hedge derivatives
3.2
0.2
Pension, other postretirement, and postemployment benefits:
Net actuarial loss
(1,760.0)
(1,806.3)
Prior service credits
69.9
81.7
Accumulated other comprehensive loss
$
(2,474.4)
$
(2,519.7)
(10) Stock Plans
We
have various
stock-based compensation
programs under
which awards,
including stock
options, restricted
stock, restricted
stock
units, and performance
awards, may be granted
to employees and non-employee
directors. These programs
and related accounting
are
described in Note
12 to the
Consolidated Financial
Statements included
in our Annual
Report on Form
10-K for the
fiscal year ended
May 26, 2024.
Compensation expense related to stock-based payments recognized
in the Consolidated Statements of Earnings was as follows:
Quarter Ended
Nine-Month Period Ended
In Millions
Feb. 23, 2025
Feb. 25, 2024
Feb. 23, 2025
Feb. 25, 2024
Compensation expense related to stock-based payments
$
20.5
$
18.2
$
67.1
$
76.7
Windfall tax benefits from stock-based
payments in income tax expense in our Consolidated Statements of Earnings
were as follows:
Quarter Ended
Nine-Month Period Ended
In Millions
Feb. 23, 2025
Feb. 25, 2024
Feb. 23, 2025
Feb. 25, 2024
Windfall tax benefits from stock-based payments
$
1.1
$
1.2
$
5.9
$
10.1
As
of
February
23,
2025,
unrecognized
compensation
expense
related
to
non-vested
stock
options,
restricted
stock
units,
and
performance share units was $
141.5
million. This expense will be recognized over
months on average.
Net cash proceeds from the exercise of stock options
less shares used for withholding taxes and the intrinsic
value of options exercised
were as follows:
Nine-Month Period Ended
In Millions
Feb. 23, 2025
Feb. 25, 2024
Net cash proceeds
$
38.4
$
11.1
Intrinsic value of options exercised
$
11.0
$
3.4
We
estimate the
fair value
of each
option on
the grant
date using
a Black-Scholes
option-pricing
model, which
requires us
to make
predictive assumptions
regarding future
stock price volatility,
employee exercise
behavior, dividend
yield, and
the forfeiture
rate. We
estimate our future
stock price volatility
using the historical
volatility over
the expected term
of the option,
excluding time
periods of
volatility we believe a marketplace participant would
exclude in estimating our stock price volatility.
We also have
considered, but did
not use, implied
volatility in our estimate,
because trading activity in
options on our stock,
especially those with
tenors of greater than
6 months, is
insufficient to
provide a reliable
measure of expected
volatility.
Our method of
selecting the other
valuation assumptions
is
explained
in
Note
to
the
Consolidated
Financial
Statements
included
in
our
Annual
Report
on
Form
10-K
for
the
fiscal
year
ended May 26, 2024.
The
estimated
fair
values
of
stock
options
granted
and
the
assumptions
used
for
the
Black-Scholes
option-pricing
model
were
as
follows:
Nine-Month Period Ended
Feb. 23, 2025
Feb. 25, 2024
Estimated fair values of stock options granted
$
13.26
$
17.47
Assumptions:
Risk-free interest rate
4.5
%
4.0
%
Expected term
8.5
years
8.5
years
Expected volatility
21.6
%
21.5
%
Dividend yield
3.8
%
2.8
%
The total grant date fair value of restricted stock unit awards that vested during
the period was as follows:
Nine-Month Period Ended
In Millions
Feb. 23, 2025
Feb. 25, 2024
Total grant date fair
value
$
111.3
$
91.1
(11) Earnings Per Share
Basic and diluted earnings per share (EPS) were calculated using the following:
Quarter Ended
Nine-Month Period Ended
In Millions, Except per Share Data
Feb. 23, 2025
Feb. 25, 2024
Feb. 23, 2025
Feb. 25, 2024
Net earnings attributable to General Mills
$
625.6
$
670.1
$
2,001.2
$
1,939.1
Average number
of common shares – basic EPS
552.6
569.5
556.6
578.6
Incremental share effect from: (a)
Stock options
1.0
1.3
1.4
1.8
Restricted stock units and performance share units
1.4
2.0
1.8
2.1
Average number
of common shares – diluted EPS
555.0
572.8
559.8
582.5
Earnings per share – basic
$
1.14
$
1.18
$
3.60
$
3.35
Earnings per share – diluted
$
1.12
$
1.17
$
3.57
$
3.33
(a)
Incremental
shares
from
stock
options,
restricted
stock
units,
and
performance
share
units
are
computed
by
the
treasury
stock
method. Stock options, restricted
stock units, and performance
share units excluded from
our computation of diluted
EPS because
they were not dilutive were as follows:
Quarter Ended
Nine-Month Period Ended
In Millions
Feb. 23, 2025
Feb. 25, 2024
Feb. 23, 2025
Feb. 25, 2024
Anti-dilutive stock options, restricted stock units, and
performance share units
5.3
4.2
4.7
2.6
(12) Share Repurchases
Share repurchases were as follows:
Quarter Ended
Nine-Month Period Ended
In Millions
Feb. 23, 2025
Feb. 25, 2024
Feb. 23, 2025
Feb. 25, 2024
Shares of common stock
4.8
4.7
13.5
23.5
Aggregate purchase price
$
304.4
$
303.1
$
909.6
$
1,616.6
(13) Statements of Cash Flows
Our Consolidated Statements of Cash Flows include the following:
Nine-Month Period Ended
In Millions
Feb. 23, 2025
Feb. 25, 2024
Net cash interest payments
$
302.2
$
294.6
Net income tax payments
$
444.6
$
462.3
(14) Retirement and Postemployment Benefits
Components of net periodic benefit expense (income) are as follows:
Defined Benefit
Pension Plans
Other Postretirement
Benefit Plans
Postemployment
Benefit Plans
Quarter Ended
Quarter Ended
Quarter Ended
In Millions
Feb. 23,
2025
Feb. 25,
2024
Feb. 23,
2025
Feb. 25,
2024
Feb. 23,
2025
Feb. 25,
2024
Service cost
$
12.9
$
14.5
$
1.0
$
1.1
$
1.8
$
1.8
Interest cost
76.6
74.1
5.3
5.3
1.0
1.0
Expected return on plan assets
(104.9)
(104.5)
(9.0)
(8.6)
-
-
Amortization of losses (gains)
25.0
21.6
(5.1)
(5.1)
(0.3)
-
Amortization of prior service costs (credits)
0.3
0.4
(5.5)
(5.5)
(0.3)
0.1
Other adjustments
-
-
-
-
3.0
2.6
Net expense (income)
$
9.9
$
6.1
$
(13.3)
$
(12.8)
$
5.2
$
5.5
Defined Benefit
Pension Plans
Other Postretirement
Benefit Plans
Postemployment
Benefit Plans
Nine-Month
Period Ended
Nine-Month
Period Ended
Nine-Month
Period Ended
In Millions
Feb. 23,
2025
Feb. 25,
2024
Feb. 23,
2025
Feb. 25,
2024
Feb. 23,
2025
Feb. 25,
2024
Service cost
$
38.8
$
43.1
$
3.2
$
3.5
$
5.3
$
5.5
Interest cost
230.0
222.4
15.9
16.0
3.0
3.0
Expected return on plan assets
(314.9)
(313.4)
(26.9)
(26.0)
-
-
Amortization of losses (gains)
75.0
64.6
(15.4)
(15.3)
-
(0.1)
Amortization of prior service costs (credits)
1.0
1.3
(16.6)
(16.4)
(0.8)
0.4
Other adjustments
-
-
-
-
8.1
7.8
Curtailment gain
-
(3.4)
-
-
-
-
Net expense (income)
$
29.9
$
14.6
$
(39.8)
$
(38.2)
$
15.6
$
16.6
In addition, we had $
0.9
million of net plan assets classified as held for sale as of February 23, 2025.
(15) Income Taxes
In
December
2021,
the
Organization
for
Economic
Cooperation
and
Development
(OECD)
established
a
framework,
referred
to
as
Pillar
2,
designed
to
ensure
large
multinational
enterprises
pay
a
minimum
percent
level
of
tax
on
the
income
arising
in
each
jurisdiction
in
which
they
operate.
Numerous
countries
have
already
enacted
the
OECD
model
rules
effective
for
taxable
years
beginning
after
December
31,
2023,
which
for
us
is
fiscal
There
was
no
material
impact
on
our
consolidated
financial
statements.
Several
other
countries
have
enacted
or
drafted
legislation
that
is
not
yet
effective
for
us,
and
we
do
not
expect
this
legislation
to
have
a
material
impact
on
our
consolidated
financial
statements.
We
will
continue
to monitor
for
new
legislation
and
guidance and evaluate potential impact on our consolidated financial
statements.
During the
second quarter
of fiscal
2024, we
received a
notice of
proposed adjustment
from the
Internal Revenue
Service associated
with a capital loss
from fiscal 2019.
We
believe that we
have meritorious defenses
against this assessment
and will vigorously
defend
our
position. We
do
not
expect
the
resolution
of
the
proposed
adjustment
to
have
a
material
impact
on
our
financial
position
or
liquidity.
(16) Business Segment and Geographic Information
We
operate
in
the
packaged
foods
industry.
Our
operating
segments
are
as
follows:
North
America
Retail,
International,
North
America Pet,
and North
America Foodservice.
In the
first quarter
of fiscal
2025, we
renamed the
Pet segment
to the
North America
Pet segment to reflect that
pet food results outside
North America are recorded
in the International segment.
There were no changes to
the
composition
of
our
reportable
segments
or
information
reviewed
by
our
chief
operating
decision
maker
and
no
impact
on
our
historical segment operating results.
Our North America Retail
operating segment reflects business
with a wide variety of
grocery stores, mass merchandisers, membership
stores,
natural
food
chains,
drug,
dollar
and
discount
chains,
convenience
stores,
and
e-commerce
grocery
providers.
Our
product
categories
in
this
business
segment
include
ready-to-eat
cereals,
refrigerated
yogurt,
soup,
meal
kits,
refrigerated
and
frozen
dough
products,
dessert
and
baking
mixes,
frozen
pizza
and
pizza
snacks,
snack
bars,
fruit
snacks,
savory
snacks,
and
a
wide
variety
of
organic products including ready-to-eat cereal, frozen
and shelf-stable vegetables, meal kits, fruit snacks, and snack bars.
Our
International
operating
segment
consists
of
retail
and
foodservice
businesses
outside
of
the
United
States
and
Canada.
Our
product categories include super-premium
ice cream and frozen desserts, meal kits, salty snacks,
snack bars, dessert and baking mixes,
shelf-stable
vegetables,
and
pet
food
products.
We
also
sell
super-premium
ice
cream
and
frozen
desserts
directly
to
consumers
through owned
retail shops. Our
International segment
also includes products
manufactured in
the United States
for export, mainly
to
Caribbean and Latin American markets, as well as products we
manufacture for sale to our international joint ventures. Revenues
from
export activities are reported in the region or country where the end customer
is located.
Our North
America Pet
operating segment
includes pet
food products
sold primarily
in the
United States
and Canada
in national
pet
superstore
chains,
e-commerce
retailers,
grocery
stores,
regional
pet
store
chains,
mass
merchandisers,
and
veterinary
clinics
and
hospitals.
Our
product
categories
include
dog
and
cat
food
(dry
foods,
wet
foods,
and
treats)
made
with
whole
meats,
fruits,
vegetables,
and other
high-quality
natural
ingredients.
Our tailored
pet product
offerings
address
specific dietary,
lifestyle,
and
life-
stage needs
and span
different product
types, diet
types, breed
sizes for
dogs, life-stages,
flavors, product
functions,
and textures
and
cuts for wet foods.
Our
North
America
Foodservice
segment
consists
of
foodservice
businesses
in
the
United
States
and
Canada.
Our
major
product
categories
in
our
North
America
Foodservice
operating
segment
are
ready-to-eat
cereals,
snacks,
refrigerated
yogurt,
frozen
meals,
unbaked and
fully baked
frozen dough products,
baking mixes,
and bakery
flour.
Many products we
sell are branded
to the consumer
and nearly
all are
branded to
our customers.
We
sell to
distributors and
operators in
many customer
channels including
foodservice,
vending, and supermarket bakeries.
Operating profit
for these
segments excludes
unallocated corporate
items, gain
or loss
on divestitures,
and restructuring,
impairment,
and other
exit costs.
Results from
certain businesses
managed by
our Gold
Medal Ventures
entity are
included within
corporate and
other net
sales and
unallocated corporate
items within
operating
profit. Unallocated
corporate items
also include
corporate overhead
expenses,
variances
to
planned
North
American
employee
benefits
and
incentives,
certain
charitable
contributions,
restructuring
initiative
project-related
costs,
gains
and
losses
on
corporate
investments,
and
other
items
that
are
not
part
of
our
measurement
of
segment operating performance.
These include gains and
losses arising from the
revaluation of certain grain
inventories and gains
and
losses
from
mark-to-market
valuation
of
certain
commodity
positions
until
passed
back
to
our
operating
segments.
These
items
affecting
operating
profit
are
centrally
managed
at
the
corporate
level
and
are
excluded
from
the
measure
of
segment
profitability
reviewed
by executive
management.
Under our
supply chain
organization,
our manufacturing,
warehouse,
and distribution
activities
are
substantially
integrated
across
our
operations
in
order
to
maximize
efficiency
and
productivity.
As
a
result,
fixed
assets
and
depreciation and amortization expenses are neither maintained nor available
by operating segment.
Our operating segment results were as follows:
Quarter Ended
Nine-Month Period Ended
In Millions
Feb. 23, 2025
Feb. 25, 2024
Feb. 23, 2025
Feb. 25, 2024
Net sales:
North America Retail
$
3,009.1
$
3,242.1
$
9,347.2
$
9,620.1
International
651.3
680.1
2,058.9
2,079.0
North America Pet
623.7
624.5
1,795.6
1,773.7
North America Foodservice
555.3
551.7
1,721.5
1,669.7
Total segment net
sales
$
4,839.4
$
5,098.4
$
14,923.2
$
15,142.5
Corporate and other
2.8
0.8
7.2
0.8
Total net sales
$
4,842.2
$
5,099.2
$
14,930.4
$
15,143.3
Operating profit:
North America Retail
$
648.1
$
752.2
$
2,256.1
$
2,410.3
International
18.0
18.2
62.7
102.8
North America Pet
102.2
128.3
360.9
342.0
North America Foodservice
82.3
81.7
272.3
236.3
Total segment operating
profit
$
850.6
$
980.4
$
2,952.0
$
3,091.4
Unallocated corporate items
55.9
63.9
244.5
308.3
Divestiture gain
(95.9)
-
(95.9)
-
Restructuring, impairment, and other exit (recoveries) costs
(0.8)
5.8
2.6
130.6
Operating profit
$
891.4
$
910.7
$
2,800.8
$
2,652.5
Net sales for our North America Retail operating units were as follows:
Quarter Ended
Nine-Month Period Ended
In Millions
Feb. 23, 2025
Feb. 25, 2024
Feb. 23, 2025
Feb. 25, 2024
U.S. Meals & Baking Solutions
$
1,130.4
$
1,168.5
$
3,404.6
$
3,453.7
U.S. Morning Foods
846.3
940.7
2,642.1
2,725.4
U.S. Snacks
818.0
869.2
2,571.6
2,660.0
Canada
214.4
263.7
728.9
781.0
Total
$
3,009.1
$
3,242.1
$
9,347.2
$
9,620.1
Net sales by class of similar products were as follows:
Quarter Ended
Nine-Month Period Ended
In Millions
Feb. 23, 2025
Feb. 25, 2024
Feb. 23, 2025
Feb. 25, 2024
Snacks
$
996.0
$
1,052.4
$
3,157.8
$
3,226.4
Cereal
762.8
843.4
2,385.4
2,438.2
Convenient meals
754.1
840.2
2,228.1
2,290.8
Dough
647.5
605.1
1,887.9
1,915.1
Pet
651.7
627.6
1,880.1
1,779.8
Baking mixes and ingredients
467.5
507.5
1,501.8
1,536.3
Yogurt
333.1
367.0
1,082.8
1,100.3
Super-premium ice cream
137.5
142.0
514.0
534.3
Other
92.0
114.0
292.5
322.1
Total
$
4,842.2
$
5,099.2
$
14,930.4
$
15,143.3
Item 2. Management’s Discussion and Analysis
Management’s Discussion and Analysis
of Financial Condition and Results of Operations.
INTRODUCTION
This
Management’s
Discussion
and
Analysis
of
Financial
Condition
and
Results
of
Operations
(MD&A)
should
be
read
in
conjunction
with
the
MD&A
included
in
our
Annual
Report
on
Form
10-K
for
the
fiscal
year
ended
May
26,
2024,
for
important
background
regarding,
among other
things, our
key business
drivers.
Significant
trademarks and
service marks
used in
our business
are set forth in
italics
herein. Certain terms used throughout this report are defined in the
“Glossary” section below.
The
impact
that
the
imposition
of
tariffs
and
changes
to
global
trade
policies
will have
on
our
consolidated
results
of operations
is
uncertain. We
expect tariffs on
goods imported into
the U.S. from
Canada, Mexico, and
China, and other
countries upon which
tariffs
may
be imposed,
to continue
to be
met with
retaliatory
tariffs
from
those countries
which
would
impact
our consolidated
results of
operations as we import
inputs required for our
manufacturing processes and
export our finished products.
The extent and duration
of
tariffs
and the
resulting impact
on macroeconomic
conditions and
on our
business are
uncertain and
may depend
on various
factors,
including
negotiations
between
the
U.S.
and
affected
countries,
retaliation
imposed
by
other
countries,
tariff
exemptions,
negative
sentiment
toward
U.S.
companies
and
products,
and
availability
of
lower
cost
inputs
that
may
be
sourced
domestically.
We
will
continue to evaluate the nature and extent of the impact to our business and
consolidated results of operations.
CONSOLIDATED
RESULTS
OF OPERATIONS
Third Quarter Results
In the third quarter of fiscal 2025,
net sales and organic net sales decreased
5 percent compared to the same period
last year. Operating
profit decreased
2 percent
to $891
million, primarily
driven by
unfavorable net
price realization
and mix,
a decrease
in contributions
from volume growth, net recoveries recorded in fiscal 2024 from
the fiscal 2023 voluntary recall on certain international
Häagen-Dazs
ice cream
products,
and transaction
costs primarily
related to
the definitive
agreements to
sell our
North American
yogurt businesses
and the Whitebridge
Pet Brands acquisition.
These impacts were partially
offset by a
divestiture gain related
to the sale of
our Canada
yogurt
business
and
a
favorable
change
in
the
mark-to-market
valuation
of
certain
commodity
positions
and
grain
inventories.
Operating profit margin
of 18.4 percent increased 50
basis points. Adjusted operating profit
of $801 million decreased
13 percent on a
constant-currency
basis, primarily
driven
by unfavorable
net price
realization
and
mix and
a decrease
in contributions
from
volume
growth. Adjusted
operating profit
margin decreased
140 basis points
to 16.5 percent.
Diluted earnings
per share
of $1.12
decreased 4
percent in
the third
quarter of
fiscal 2025.
Adjusted diluted
earnings per
share of
$1.00 decreased
15 percent
on a
constant-currency
basis
compared
to
the
third
quarter
of
fiscal
See
the
“Non-GAAP
Measures”
section
below
for
a
description
of
our
use
of
measures not defined by GAAP.
A summary of our consolidated financial results for the third quarter of
fiscal 2025 follows:
Quarter Ended Feb. 23, 2025
In millions,
except per share
Quarter Ended
Feb. 23, 2025 vs.
Feb. 25, 2024
Percent
of Net
Sales
Constant-
Currency
Growth (a)
Net sales
$
4,842.2
(5)
%
Operating profit
891.4
(2)
%
18.4
%
Net earnings attributable to General Mills
625.6
(7)
%
Diluted earnings per share
$
1.12
(4)
%
Organic net sales growth rate (a)
(5)
%
Adjusted operating profit (a)
800.8
(12)
%
16.5
%
(13)
%
Adjusted diluted earnings per share (a)
$
1.00
(15)
%
(15)
%
(a)
See the “Non-GAAP Measures” section below for our use of measures not defined by
GAAP.
Consolidated
net sales
were as follows:
Quarter Ended
Feb. 23, 2025
Feb. 23, 2025 vs.
Feb. 25, 2024
Feb. 25, 2024
Net sales (in millions)
$
4,842.2
(5)
%
$
5,099.2
Contributions from volume growth (a)
(4)
pts
Net price realization and mix
Flat
Foreign currency exchange
(1)
pt
Note: Table may
not foot due to rounding.
(a)
Measured in tons based on the stated weight of our product shipments.
Net sales
in the
third quarter
of fiscal
2025 decreased
5 percent
compared to
the same
period in
fiscal 2024,
driven by
a decrease
in
contributions from volume growth and unfavorable foreign currency
exchange.
Components of organic net sales growth are shown in the following
table:
Quarter Ended Feb. 23, 2025 vs.
Quarter Ended Feb. 25, 2024
Contributions from organic volume growth (a)
(4)
pts
Organic net price realization and mix
(1)
pt
Organic net sales growth
(5)
pts
Foreign currency exchange
(1)
pt
Acquisitions and divestiture
pt
Net sales growth
(5)
pts
Note: Table may
not foot due to rounding.
(a)
Measured in tons based on the stated weight of our product shipments.
Organic
net
sales
decreased
percent
in
the
third
quarter
of
fiscal
2025
compared
to
the
same
period
in
fiscal
2024,
driven
by
a
decrease in contributions from organic volume growth
and unfavorable organic net price realization and mix.
Cost of sales
decreased $189 million
to $3,203 million
in the third
quarter of fiscal
2025 compared to
the same period
in fiscal 2024.
The decrease was primarily
driven by a $122 million decrease
attributable to lower volume
and a $18 million net
decrease attributable
to
product
rate
and
mix.
We
recorded
a
$23 million
net
decrease
in
cost
of
sales
related
to
the
mark-to-market
valuation
of
certain
commodity
positions
and
grain
inventories
in
the
third
quarter
of
fiscal
2025,
compared
to
a
$26 million
net
increase
in
the
third
quarter of fiscal 2024.
Selling,
general
and
administrative
(SG&A)
expenses
increased
$54 million
to
$844 million
in
the
third
quarter
of
fiscal
2025,
compared to
the same period
in fiscal 2024,
primarily driven
by net recoveries
recorded in fiscal
2024 from
the fiscal 2023
voluntary
recall on
certain
international
Häagen-Dazs
ice cream
products and
transaction
costs related
to the
definitive agreements
to sell
our
North American
yogurt businesses
and the
Whitebridge Pet
Brands acquisition.
SG&A expenses
as a
percent of
net sales
in the
third
quarter of fiscal 2025 increased 190 basis points compared to the third quarter
of fiscal 2024.
Divestiture
gain
of $96
million in
the third
quarter of
fiscal 2025,
related to
the sale
of our
Canada yogurt
business (please
refer to
Note 2 to the Consolidated Financial Statements in Part I, Item 1 of this report).
Restructuring, impairment,
and other exit
(recoveries) costs
totaled $1
million of net
recoveries in
the third quarter
of fiscal 2025
related to actions
previously announced,
compared to $6
million of net
restructuring costs in
the same period
last year (please
refer to
Note 3 to the Consolidated Financial Statements in Part I, Item 1 of this report).
Benefit plan
non-service income
totaled $14 million
in the
third quarter
of fiscal
2025,
compared to
$19 million in
the same
period
last year, primarily reflecting higher
amortization of losses and interest costs.
Interest,
net
for the
third quarter
of fiscal
2025 totaled
$136 million, up
$15 million from
the third
quarter of
fiscal 2024,
primarily
driven by higher average long-term debt levels.
The
effective
tax
rate
for
the third
quarter
of fiscal
2025
was 19.8
percent
compared
to 18.5
percent
for
the
third
quarte
Showing the first 8K of 73K characters. Open the full section
Item 3. Quantitative and Qualitative Disclosures About Market Risk.
Quantitative and Qualitative Disclosures About Market Risk.
The
estimated
maximum
potential
value-at-risk
arising
from
a
one-day
loss
in
fair
value
for
our
interest
rate,
foreign
exchange,
commodity, and equity
market-risk-sensitive instruments outstanding as of February 23, 2025,
was as follows:
In Millions
One-day Risk
of Loss
Change During
Nine-Month
Period Ended
Feb. 23, 2025
Analysis of Change
Interest rate instruments
$
$
(11)
Decrease in interest rates
Foreign currency instruments
Increase in portfolio basis
Commodity instruments
(1)
Immaterial
Equity instruments
-
Immaterial
For additional information, see Item 7A of Part II of our Annual Report on Form 10-K
for the fiscal year ended May 26, 2024.
Item 4. Controls and Procedures.
Controls and Procedures.
We,
under the
supervision and
with the
participation of
our management,
including our
Chief Executive
Officer and
Chief Financial
Officer,
have
evaluated
the
effectiveness
of
the design
and
operation
of
our
disclosure
controls
and
procedures
(as
defined
in
Rule
13a-15(e)
under
the
Securities
Exchange
Act
of
1934).
Based
on
our
evaluation,
our
Chief
Executive
Officer
and
Chief
Financial
Officer have concluded
that, as of February
23, 2025, our disclosure
controls and procedures were
effective to ensure
that information
required to
be disclosed
by us
in reports
that we file
or submit
under the
Securities Exchange
Act of
1934 is (1)
recorded, processed,
summarized,
and
reported
within
the
time
periods
specified
in
Securities
and
Exchange
Commission
rules
and
forms,
and
(2)
accumulated and
communicated to
our management,
including our
Chief Executive
Officer and
Chief Financial
Officer,
in a
manner
that allows timely decisions regarding required disclosure.
There were no changes in our internal
control over financial reporting (as defined
in Rule 13a-15(f) under the Securities Exchange
Act
of 1934) during the quarter
ended February 23, 2025, that
materially affected, or are
reasonably likely to materially
affect, our internal
control over financial reporting.
PART
II.
OTHER INFORMATION
Item 2.
Unregistered Sales of Equity Securities and Use of Proceeds.
The
following
table
sets forth
information
with
respect
to
shares
of
our
common
stock
that we
purchased
during
the quarter
ended
February 23, 2025:
Period
Total
Number
of Shares
Purchased (a)
Average
Price Paid
Per Share
Total
Number of Shares
Purchased as Part of a Publicly
Announced Program (b)
Maximum Number of Shares
that may yet be Purchased
Under the Program (b)
November 25, 2024 -
December 29, 2024
1,910,552
$
66.25
1,910,552
45,034,753
December 30, 2024 -
January 26, 2025
2,254,605
61.24
2,254,605
42,780,148
January 27, 2025 -
February 23, 2025
644,987
61.64
644,987
42,135,161
Total
4,810,144
$
63.28
4,810,144
42,135,161
(a)
The total number
of shares purchased
includes shares of
common stock withheld
for the payment
of withholding taxes
upon the distribution
of
deferred option units.
(b)
On June
27, 2022,
our Board
of Directors approved
an authorization
for the
repurchase of
up to
100,000,000 shares of
our common stock
and
terminated the
prior authorization.
Purchases can
be made
in the
open market
or in
privately negotiated
transactions, including
the use
of call
options
and
other
derivative
instruments,
Rule
10b5-1
trading
plans,
and
accelerated
repurchase
programs.
The
Board
did
not
specify
an
expiration date for the authorization.
Item 5. Other Information.
Other Information.
During
the
fiscal
quarter
ended
February
23,
2025,
no
director
or
officer
of
the
Company
adopted
or
terminated
a
“Rule
10b5-1
trading arrangement” or “
non-Rule
10b5-1
trading arrangement,” as each term is defined in Item 408(a) of Regulation S-K.
PART
II. OTHER INFORMATION
Item 6. Exhibits.
Exhibits.
31.1
Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2
Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1
Certification of Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2
Certification of Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
Financial Statements
from the
Quarterly Report
on Form
10-Q of
the Company
for the
quarter ended
February 23,
2025,
formatted
in
Inline
Extensible
Business
Reporting
Language:
(i)
Consolidated
Statements
of
Earnings;
(ii)
Consolidated
Statements
of
Comprehensive
Income,
(iii)
Consolidated
Balance
Sheets;
(iv)
Consolidated
Statements of
Total
Equity; (v)
Consolidated Statements
of Cash
Flows; and
(vi) Notes
to Consolidated
Financial
Statements.
Cover Page, formatted in Inline Extensible Business Reporting Language
and contained in Exhibit 101.
SIGNATURES
Pursuant
to
the
requirements
of
the
Securities
Exchange
Act
of
1934,
the
registrant
has
duly
caused
this
report
to
be
signed
on
its
behalf by the undersigned thereunto duly authorized.
GENERAL MILLS, INC.
(Registrant)
Date: March 19, 2025
/s/ Mark A. Pallot
Mark A. Pallot
Vice President, Chief Accounting
Officer
(Principal Accounting Officer and Duly Authorized
Officer)