General Mills Boosts FY23 Outlook Post Solid Q3 Earnings Beat

General Mills Inc GIS reported third-quarter FY23 sales growth of 13% year-on-year to $5.12 billion, beating the consensus of $4.97 billion. Organic net sales increased 16%.
North America Retail segment sales increased 15% Y/Y to $3.2 billion. Pet segment sales rose 14% to $646 million, while International segment sales fell 3% to $701 million.
Adjusted EPS of $0.97 topped the consensus of $0.92.
Gross margin expanded 160 basis points Y/Y to 32.5%. Adjusted gross margin rose 240 basis points to 33.8%.
Operating margin contracted 380 basis points to 14.2%, and operating income for the quarter was $730 million.
General Mills held $618.7 million in cash and equivalents as of Feb. 26, 2023. Net cash provided by operating activities for nine months totaled $2 billion.
General Mills Chairman and CEO Jeff Harmening said, "Our brands are winning with consumers, and we plan to sustain this momentum by continuing to invest in brand building, innovation, and capabilities that will drive future growth."
Outlook: General Mills raised FY23 Organic net sales growth guidance to 10% - 11% from the previously expected 10%.
The company raised FY23 adjusted EPS constant currency growth outlook from 7% - 8% to 8% - 9%.
Price Action: GIS shares are trading higher by 1.04% at $80.70 in premarket on the last check Thursday.
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