Shares of General Mills (NYSE: GIS) took a near 9% dive on Wednesday after the Company reported fourth quarter revenue that fell short of analysts’ expectations.
The maker of Cheerios said sales rose 7% to USD 4.16 Billion, thanks to the Company’s purchase of Blue Buffalo in April. Wall Street forecasted sales of USD 4.24 Billion. General Mills did outperform on earnings, however. The Company reported adjusted earnings of USD 0.83 per share, versus consensus estimates of USD 0.77 per share.
For full-year 2019, General Mills said revenue increased 7% to USD 16.86 Billion. The Company saw 6% organic sales growth in Asia and Latin America driven by revenue from Nature Valley and Betty Crocker treats. General Mills struggled in North America as snack sales took a hit in both the U.S. and Canada.
“I’m pleased to say that we executed well, successfully transitioned Blue Buffalo into our portfolio, and delivered our financial commitments in fiscal 2019,” said Chairman and Chief Executive Officer Jeff Harmening. “We’ll look to improve our performance again in fiscal 2020, and we have plans in place to accelerate our organic sales growth while maintaining our strong margins and cash discipline.”
General Mills expects organic sales to rise up to 2% in fiscal 2020 as it aims to maintain momentum in cereal sales and improve in the snack department. On a like-for-like basis, Blue Buffalo is expected to deliver an 8% to 10% sales increase.
Shares of General Mills are up nearly 34% this year versus competitors like Kellogg’s (NYSE: K), down 7%, and ConAgra Brands (NYSE: CAG), up 21%.