General Mills’ quarterly pet sales reach $593 million

Net sales in the quarter from September to November 2022 were on parity with the previous year, which was negatively impacted by a reduction in retailer inventory, with all-channel retail sales running in single digits in the period.

According to the Minnesota manufacturer, the pet category is expected to accelerate in the coming months due to increased capacity, improved customer service, increased brand-building investment, and an expectation for stable retailer inventory levels.

Segment operating profit in Q2 FY 2022 equaled $87 million compared to $132 million in 2021. The drop in profit was driven primarily by “elevated input cost inflation, a substantial increase in costs related to capacity expansion and supply chain disruptions, and lower volume, including the impact of the retailer inventory reduction.”

Favorable outlook

However, its 6-month results show a favorable outlook. General Mills’ pet net sales grew by 8% to $1.2 billion, including a 2-point benefit from the pet treats acquisition.

Organic net sales were up 6%, while segment operating profit fell by 15% to $210 million due to higher input costs, reduced volume, and higher operating expenses.

In the third quarter of FY 2022, the company completed a new organizational structure to streamline its global operations. The restructure included creating 4 new independent units, with one overseeing the company’s pet portfolio.

Headwinds on the horizon

The company expects the most significant factors impacting its performance in fiscal 2023 to be the economic health of consumers, the inflationary cost environment, and the frequency and severity of disruptions in the supply chain.

Jeff Harmening, Chairman and Chief Executive Officer of General Mills, stated that amid current volatility in the operating setting, it remains focused on 3 areas; “investing in brand building and innovation, strengthening our capabilities, and continuing to reshape our portfolio.”