General Mills’ pet portfolio hits $2.5 billion
The American multinational’s dry food and treats increased performance in FY23.
Sales for General Mills’ pet segment increased by 9% to $2.5 billion (€2.2B) in the fiscal year (FY) that ended on 28 May 2023.
The Minneapolis-headquartered firm says that organic net sales in the category also increased by 9% in the last year due to the improved performance of dry food and pet treats.
Conversely, operating profit was down 5 percent to $446 million (€407.8M). According to the firm, this was driven by higher input costs and lower volume.
According to Investopedia, company shares dropped by almost 5% after the earnings release, as General Mills had “weaker-than-expected profit and sales as prices rose and shoppers pulled back.”
CEO Jeff Harmening commented on the “excellent” 2023 results, saying that, overall, the company experienced a record-breaking total that exceeded $20 billion (€18.2B) in net sales across all the businesses—6% more than in 2022.
Q4 results
In the last 3 months to 28 May 2023, General Mills posted an increase of 7% in sales within the pet segment to $655 million (€599M). In Q4 2022, net sales accounted for $610.3 million (€558M).
The company said that net sales in the last quarter of FY23 were up by double digits in dry pet food and up in high single digits for treats. In contrast, wet pet food noted a single-digit decline.
The segment operating profit for Q4 totaled $133 million (€121.6M), an increase of 18% up from $113.3 million (€103.3M) in the same quarter last year.
2024 forecast
CFO Kofi Bruce said that the company expects to drive pet operating profit growth “a bit faster” than organic net sales growth in FY 2024, supported by improved volume performance and lower disruption-related supply chain costs.
Bruce added that in 2024, they expect less of a headwind from pricing and forecasted a significant step-down.
General Mills hopes to see more stability in the supply chain, which in turn should “allow for much stronger commercial activity, including increased distribution, innovation, brand-building investment, and quality merchandising.”
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