General Mills shares fall as profit misses on weak yogurt, cereal sales
General Mills reported a smaller-than-expected quarterly profit, hurt by lower sales of its yogurts and cereals in North America.
The Cheerios cereal maker's shares fell 4.3 percent to $53 in premarket trading on Wednesday.
General Mills said its U.S. yogurt sales recorded a double- digit drop as demand for Yoplait Greek and Yoplait Light products remained weak.
Net sales in its U.S. cereal operating unit fell 7 percent, reflecting a reduction in customer inventory levels among other things.
U.S. packaged food makers, including General Mills, Conagra Brands and Kellogg, have been facing falling demand as consumers increasingly prefer fresh, organic products over packaged and frozen food.
The sector is expected to come under renewed pressure with the entry of online giant Amazon.com into the brick-and-mortar grocery stores business through its deal to buy Whole Foods Market Inc.
Net income attributable to General Mills fell to $404.7 million in the first quarter ended Aug. 27 from $409 million a year earlier.
On a per-share basis, earnings rose to 69 cents from 67 cents. Excluding one-time items, the company earned 71 cents per share.
The company's net sales fell 3.5 percent to $3.77 billion.
Analysts on average had expected an adjusted profit of 76 cents per share and sales of $3.79 billion, according to Thomson Reuters I/B/E/S.
(Reporting by Vibhuti Sharma in Bengaluru; Editing by Anil D'Silva)