Food manufacturer General Mills, Inc. (NYSE: GIS) recently reported a 5% jump in fourth-quarter net sales. This resulted in a net income jump of almost 10%, from $185.2 million to $358.8 million. This translated into a leap from 53 cents to $1.07 per share, or an adjusted earnings increase from 73 cents to 86 cents per share. In the same period, sales increased from $3.47 billion to $3.65 billion.Although most famous for its breakfast cereals, General Mills actually provides a wide array of home cooking products, ranging from the old-fashioned to the organic and from raw ingredients to fully-prepared meals. As such, it is positioned to experience massive growth as recession-plagued former restaurant customers start cooking at home and economizing home chefs move away from pricey prepared dishes.
The company is predicting that its 2010 adjusted net will increase by as much as 7%, a move that will yield a jump of up to 27 cents per share, from $3.98 to $4.25. For General Mills, at least, the recession looks like a fantastic growth opportunity.
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Reader Comments (Page 1 of 1)
7-01-2009 @ 5:27PM
Iridium said...
Look past the headline to the real story once again.
General Mills profit is up because they did not lower prices in response to the huge decline in grain costs. Any moron can see this. Early last year corn and wheat were nearly double the price right now. Last time I checked it still costs $4.00 for a small box of Raisin Bran at my grocery store.
We are stuck paying an inflated price becuase once the price goes up it is very hard to get it back down. General Mills and Kellogg aren't in any rush to lower wholesale prices. IN fact they've pretty much said they aren't going to do it.
Once again the general public is sold out to the shareholders once again.