General Mills(US:GIS)2025-06-25 11:06Financial Performance - Net sales for fiscal 2025 were $19.5 billion, a decrease of 2% from the prior year, with organic net sales also down 2%[5] - Fourth-quarter net sales were $4.6 billion, down 3%, with organic net sales also down 3%, impacted by a 2-point headwind from unfavorable trade expense timing[9] - Operating profit for fiscal 2025 was $3.3 billion, down 4%, while adjusted operating profit was $3.4 billion, down 7% in constant currency[5] - Diluted earnings per share (EPS) for fiscal 2025 was $4.10, down 5%, and adjusted diluted EPS was $4.21, down 7% in constant currency[5] - Net earnings attributable to General Mills for fiscal 2025 were $2.3 billion, an 8% decrease from $2.5 billion in fiscal 2024[33] - Total net sales for fiscal year 2025 decreased by 2% to $19,486.6 million compared to $19,857.2 million in fiscal year 2024[38] - North America Retail segment sales declined by 5% to $11,907.0 million in fiscal year 2025, while International segment sales increased by 2% to $2,797.8 million[38] - Operating profit for the North America Retail segment fell by 11% to $2,729.9 million in fiscal year 2025, while the North America Foodservice segment saw a 13% increase to $355.4 million[38] - The company reported a net earnings of $2,318.9 million for fiscal year 2025, down from $2,518.6 million in fiscal year 2024[44] - The company reported a total operating profit decrease of 8% for the fiscal year ended May 25, 2025, compared to the previous fiscal year[80] Segment Performance - The North America Retail segment reported a 10% decline in fourth-quarter net sales to $2.6 billion, with organic net sales down 7%[12] - The North America Pet segment saw a 12% increase in fourth-quarter net sales to $675 million, driven by a 9-point benefit from the North American Whitebridge Pet Brands acquisition[14] - The International segment's fourth-quarter net sales increased by 11% to $739 million, with organic net sales up 9%[18] - North America Retail segment reported a 29% decline in operating profit on a constant-currency basis for the quarter ended May 25, 2025[80] - International segment achieved a 42% increase in operating profit on a constant-currency basis for the same quarter, despite a 50% negative impact from foreign currency[80] Cash Flow and Investments - Operating cash flow for fiscal 2025 was $2.9 billion, down from $3.3 billion in the previous year, primarily due to lower net earnings[24] - Capital investments decreased to $625 million in fiscal 2025 from $774 million in fiscal 2024[24] - Net cash provided by operating activities for fiscal 2025 was $2,918.2 million, leading to a free cash flow of $2,292.9 million[85] - Free cash flow conversion rate for fiscal 2025 was 97%, indicating strong efficiency in converting earnings to cash[85] Future Projections - The company aims to restore volume-driven organic sales growth in fiscal 2026, focusing on consumer value, product innovation, and brand building[4] - For fiscal 2026, organic net sales are projected to range from a decline of 1% to an increase of 1%[28] - Adjusted operating profit is expected to decrease by 10% to 15% from the $3.4 billion reported in fiscal 2025[28] - Adjusted diluted EPS is anticipated to decline by 10% to 15% from the $4.21 earned in fiscal 2025[28] - The net impact of divestitures and acquisitions is expected to reduce full-year net sales growth by approximately 4%[28] - For fiscal 2026, the company expects a net sales growth reduction of approximately 4% due to foreign currency exchange rates, acquisitions, and a 53rd week[55] - The company anticipates restructuring and transformation charges for fiscal 2026 to total approximately $90 million to $95 million[55] Dividends and Shareholder Returns - The board declared a quarterly dividend of $0.61 per share, a 2% increase from the previous rate of $0.60[26] Restructuring and Charges - Restructuring, transformation, and impairment charges totaled $83.9 million in Q4 fiscal 2025, compared to $111.4 million in Q4 fiscal 2024, with total charges for fiscal 2025 amounting to $259.0 million, up from $61.0 million in fiscal 2024[3] - The company recognized $69 million in severance and other benefit costs related to restructuring actions in fiscal 2025[3] - Integration costs related to acquisitions in fiscal 2025 amounted to $14 million, primarily from the acquisition of Whitebridge Pet Brands[4] - The company incurred restructuring and transformation charges of $87.5 million for the fiscal year ended May 25, 2025[83] Taxation - The effective tax rate for fiscal 2025 was 20.2%, compared to 19.6% in the previous year[23] - The effective tax rate for Q4 fiscal 2025 was 18.3%, down from 20.1% in Q4 fiscal 2024, primarily due to nonrecurring discrete tax benefits[51] - Adjusted effective tax rate for fiscal 2025 was 20.6%, compared to 20.1% in fiscal 2024, reflecting changes in nonrecurring tax benefits[51] - Adjusted effective income tax rate for the quarter ended May 25, 2025, was 19.2%, compared to 20.0% for the same quarter in the previous year[81] Share Count and Earnings Per Share - Average number of common shares for diluted EPS calculation decreased to 550.4 million in Q4 fiscal 2025 from 570.4 million in Q4 fiscal 2024[51] - Diluted earnings per share (EPS) for the quarter was $0.74, down 27% from $1.01 in the prior year[71] - Adjusted net earnings attributable to General Mills for the fiscal year 2025 were $2,345.4 million, or 12.0% of net sales, down from 13.2% in 2024[76] - Adjusted operating profit for the quarter ended May 25, 2025, was $622.5 million, a decrease of 22% compared to $799.8 million for the same quarter in 2024[70]