MINNEAPOLIS (AP) — General Mills Inc.'s fiscal fourth-quarter net income edged up 2 percent, lifted by strength abroad and increased prices.
The food maker's brands which include Cheerios and Hamburger Helper remain some of the most popular. But like most of its peers, the company has struggled with higher costs for everything from ingredients to labor and been forced to raise prices to offset them.
Chairman and CEO Ken Powell said in a statement that fiscal 2012 had some of the highest costs in more than three decades and limited the company's earnings growth.
Aside from the rising costs, Powell said General Mills continued to deal with shoppers sticking to their budgets as they worried about uncertain economic conditions.
General Mills reported on Wednesday that it earned $325.4 million, or 49 cents per share, for the period ended May 27. That compares with $320.2 million, or 48 cents per share, during the same period a year ago.
Excluding a restructuring charge and other items, earnings were 60 cents per share. That beat the 59 cents per share that analysts polled by FactSet expected.
Revenue climbed 12 percent to $4.07 billion from $3.63 billion. Wall Street predicted $4.12 billion.
Its shares fell 98 cents, or 2.6 percent, to $37.17 in midday trading Wednesday. Its shares are down 9.5 percent from a 52-week high of $41.06 in mid-January.
International sales surged 46 percent to $1.1 billion, while sales for the U.S. retail unit climbed 3 percent to $2.42 billion.
For the year, General Mills earned $1.57 billion, or $2.35 per share. That's down from $1.8 billion, or $2.70 per share, in the previous year. Annual revenue rose 12 percent to $16.66 billion from $14.88 billion, helped by sales of new products like Peanut Butter Multi-Grain Cheerios and Fiber One 90-calorie brownie snack bars.
General Mills reported sales doubled in Europe during the fiscal year. Canada, Latin America and the Asia/Pacific region also reported sales increases.
Sales for the Big G cereal unit rose 4 percent to $2.4 billion on the strength of brands like Chex and Honey Nut Cheerios. Snack division sales climbed 15 percent, helped by the Fiber One and Nature Valley brands. Snack Planet Foods sales rose 19 percent, driven by sales of Larabar natural fruit and nut bars and Cascadian Farm organic cereals and grain snack bars.
The Pillsbury and baking products units both had 3 percent sales increases, while sales for Yoplait USA fell 5 percent.
General Mills foresees a fiscal 2013 revenue increase in the mid-single digits.
Last month the Minneapolis company announced that it would cut about 850 jobs as part of a plan to lower costs and boost efficiency. General Mills employed about 35,000 people across the world in fiscal 2011, according to its annual report.
Its shares were steady at $38.15 in premarket trading Wednesday.