General Mills Inc (NYSE:GIS) posted better than expected quarterly profits as lower market expenditure offset a decline in sales.
The Cheerios cereal, Pillsbury Dough and Haagen-Dazs group boosted operating margins by 2.5% as the benefits of its cost-savings initiatives, combined with a 17% decline in advertising and marketing spending.
As a result net income rose to US$409mln, or 69c per share, in the three months ended 28 May, from US$380mln, or 62 cents per share, even though quarterly sales fell 3.1% to US$3.81bn.
For 2018, General Mills forecast organic net sales to decline by 1% to 2%, though EPS are expected to be 1-2% above 2017’s underlying level of US$3.08.