Food manufacturer General Mills has reported sales growth of two per cent in the second quarter despite volumes remaining flat.

“Demand for our leading brands remains strong,” Chairman and Chief Executive Officer Ken Powell said. “These good sales levels, combined with the accumulating benefits of our holistic margin management efforts, are continuing to drive terrific operating performance in our manufacturing plants.”

“This strong, fundamental business momentum has enabled us to raise our EPS targets for the full year.”

The American-based maker of brands like Latina, Haagen Dazs, Old El Paso and Cheerios was helped by the weakness of the US Dollar, with international sales up seven per cent. American sales were also up, but the bakery and foodservice division lagged – with sales down double digits.

Net sales for Cereal Partners Worldwide – a joint venture with Nestle – rose four per cent.

Mr Powell added that the convenience and health and wellness trends remained well and truly in vogue.

“Consumers around the world continue to focus on nutritious, convenient food choices that help them make breakfast, lunch and dinner for their families at good value,” he advised.

Fiscal 2010 Outlook
General Mills raised its guidance for fiscal 2010 earnings to a range of $4.52 to $4.57 per share – around 15 per cent above last year’s result. Previously, the company’s 2010 EPS guidance had been a range of $4.40 to $4.45.

“Our businesses are growing, and General Mills people in our plants, sales teams and offices worldwide are delivering great performance,” Mr Powell said. “As we move into the second half of fiscal 2010, we plan to make additional reinvestments in marketing and merchandising programs to fuel continued growth for our brands this year and into fiscal 2011.”

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