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General Mills shares dip on mixed Q3 results

General Mills shares dip on mixed Q3 results

Shares of General Mills traded lower Wednesday after the U.S. food giant reported mixed third-quarter financial results and said it had completed a plan to cut approximately 800 jobs. The stock was down 1% at at $51.53 in afternoon trading. The Minneapolis-based maker of Cheerios cereal, Yoplait yogurt, Gold Medal flour and other household brands said net earnings totaled $343.2 million for the quarter that ended Feb. 22. The result was down 16.4% from the $410.6 million during the same period last year.635622795049991010-XXX-EARNS-GENERAL-MILLS-982

However, General Mills said diluted earnings per share excluding restructuring charges and other items totaled 70 cents, up 13% from the 62 cents reported for last year’s third quarter. The result topped the 67 cents per share median forecast of financial analysts surveyed by FactSet. Net sales for the quarter totaled $4.35 billion, down 1% from the same period last year, General Mills said. The company attributed the decrease to the effects of foreign currency exchange rates. The sales total beat the $4.34 billion media forecast of analysts in the FactSet survey.

General Mills projected strong fourth-quarter growth, including incremental financial contributions from the company’s recent acquisition of the Annie’s natural and organic food specialist. The company also reaffirmed its full-year financial targets, saying that adjusted earnings per share are expected to grow at a low-single-digit rate in constant currency from the $2.82 earned in fiscal year 2014. The previously-announced job cuts, mostly in the U.S., were part of a restructuring plan approved in the company’s second quarter.

Kendall Powell, General Mills’s chairman and CEO, told financial analysts during a Wednesday conference call that the company had built financial momentum with a series of “consumer first” initiatives. These included eliminating all traces of wheat from oat-based Cheerios, making the cereal gluten-free, and completing the removal of all artificial colors and flavors from the company’s Kid Yogurts. General Mills is also rolling out a 25% reduction in sugar across the entire Yoplait yogurt line, said Powell.