1 1 0000040704 2024 Q3 false --05-26 754.6 0.10 - - 0.10 0.1 0000040704 2023-11-27 2024-02-25 0000040704 2023-05-29 2024-02-25 0000040704 2022-05-30 2023-02-26 0000040704 2022-11-28 2023-02-26 0000040704 2024-02-25 0000040704 us-gaap:PensionPlansDefinedBenefitMember 2023-11-27 2024-02-25 0000040704 us-gaap:PensionPlansDefinedBenefitMember 2022-11-28 2023-02-26 0000040704 us-gaap:OtherPostretirementBenefitPlansDefinedBenefitMember 2022-11-28 2023-02-26 0000040704 us-gaap:OtherPostretirementBenefitPlansDefinedBenefitMember 2023-11-27 2024-02-25 0000040704 us-gaap:OperatingSegmentsMember 2023-11-27 2024-02-25 0000040704 us-gaap:CorporateNonSegmentMember 2023-11-27 2024-02-25 0000040704 us-gaap:CorporateNonSegmentMember 2022-11-28 2023-02-26 0000040704 us-gaap:NotesPayableToBanksMember 2023-05-28 0000040704 us-gaap:EmployeeStockOptionMember 2022-11-28 2023-02-26 0000040704 us-gaap:RestrictedStockUnitsRSUMember 2022-11-28 2023-02-26 0000040704 us-gaap:EmployeeStockOptionMember 2023-11-27 2024-02-25 0000040704 us-gaap:RestrictedStockUnitsRSUMember 2023-11-27 2024-02-25 0000040704 us-gaap:CommercialPaperMember 2023-05-28 0000040704 us-gaap:CommercialPaperMember 2024-02-25 0000040704 2022-05-29 0000040704 us-gaap:ParentMember 2023-11-27 2024-02-25 0000040704 us-gaap:NoncontrollingInterestMember 2023-11-27 2024-02-25 0000040704 us-gaap:NoncontrollingInterestMember 2023-05-29 2024-02-25 0000040704 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2023-05-29 2024-02-25 0000040704 us-gaap:AdditionalPaidInCapitalMember 2023-05-29 2024-02-25 0000040704 us-gaap:NoncontrollingInterestMember 2023-02-26 0000040704 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2023-02-26 0000040704 us-gaap:RetainedEarningsMember 2023-02-26 0000040704 us-gaap:AdditionalPaidInCapitalMember 2023-02-26 0000040704 us-gaap:CommonStockMember 2023-02-26 0000040704 2023-02-26 0000040704 us-gaap:RetainedEarningsMember 2023-05-29 2024-02-25 0000040704 us-gaap:NotesPayableToBanksMember 2024-02-25 0000040704 gis:LongTermDebtAgreementsContainingRestrictiveCovenantsMember 2023-05-29 2024-02-25 0000040704 us-gaap:OperatingSegmentsMember 2022-11-28 2023-02-26 0000040704 2024-03-13 0000040704 us-gaap:CommonStockMember 2023-05-29 2024-02-25 0000040704 gis:ZeroPointFourFiveZeroPercentNotesDue2026Member 2023-05-29 2024-02-25 0000040704 gis:OnePointFiveZeroZeroPercentNotesDue2027Member 2023-05-29 2024-02-25 0000040704 2023-05-28 0000040704 gis:NorthAmericaRetailSegmentMember 2023-05-28 0000040704 gis:PetSegmentMember 2023-05-28 0000040704 gis:CorporateAndJointVenturesMember 2023-05-28 0000040704 gis:NorthAmericaRetailSegmentMember 2024-02-25 0000040704 gis:PetSegmentMember 2024-02-25 0000040704 gis:CorporateAndJointVenturesMember 2024-02-25 0000040704 gis:LineOfCreditExpiringApril2026Member 2024-02-25 0000040704 gis:UncommittedCreditFacilityMember 2024-02-25 0000040704 gis:PetSegmentMember us-gaap:OperatingSegmentsMember 2023-11-27 2024-02-25 0000040704 gis:NorthAmericaRetailSegmentMember us-gaap:OperatingSegmentsMember 2023-11-27 2024-02-25 0000040704 gis:SnacksMember 2023-11-27 2024-02-25 0000040704 gis:SnacksMember 2022-11-28 2023-02-26 0000040704 gis:CerealMember 2023-11-27 2024-02-25 0000040704 gis:CerealMember 2022-11-28 2023-02-26 0000040704 gis:ConvenientMealsMember 2023-11-27 2024-02-25 0000040704 gis:ConvenientMealsMember 2022-11-28 2023-02-26 0000040704 gis:YogurtMember 2023-11-27 2024-02-25 0000040704 gis:YogurtMember 2022-11-28 2023-02-26 0000040704 gis:SuperPremiumIceCreamMember 2023-11-27 2024-02-25 0000040704 gis:SuperPremiumIceCreamMember 2022-11-28 2023-02-26 0000040704 us-gaap:NoncontrollingInterestMember 2022-11-28 2023-02-26 0000040704 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2023-11-27 2024-02-25 0000040704 us-gaap:AdditionalPaidInCapitalMember 2023-11-27 2024-02-25 0000040704 us-gaap:RetainedEarningsMember 2023-11-27 2024-02-25 0000040704 gis:DoughMember 2022-11-28 2023-02-26 0000040704 gis:BakingMixesAndIngredientsMember 2022-11-28 2023-02-26 0000040704 gis:DoughMember 2023-11-27 2024-02-25 0000040704 gis:BakingMixesAndIngredientsMember 2023-11-27 2024-02-25 0000040704 gis:CertainLongTermDebtAgreementsContainingRestrictiveCovenantsMember 2023-05-29 2024-02-25 0000040704 gis:NorthAmericaRetailSegmentMember 2023-05-29 2024-02-25 0000040704 gis:PetSegmentMember 2023-05-29 2024-02-25 0000040704 gis:CorporateAndJointVenturesMember 2023-05-29 2024-02-25 0000040704 us-gaap:ParentMember 2022-11-28 2023-02-26 0000040704 us-gaap:RetainedEarningsMember 2022-11-28 2023-02-26 0000040704 gis:PetSegmentMember us-gaap:OperatingSegmentsMember 2022-11-28 2023-02-26 0000040704 gis:NorthAmericaRetailSegmentMember us-gaap:OperatingSegmentsMember 2022-11-28 2023-02-26 0000040704 us-gaap:CommonStockMember 2024-02-25 0000040704 us-gaap:FairValueInputsLevel2Member 2024-02-25 0000040704 gis:ZeroPointOneTwoFivePercentNotesDue2025Member 2023-05-29 2024-02-25 0000040704 gis:EuroDenominated391NotesDueApril132029Member 2023-05-29 2024-02-25 0000040704 us-gaap:TreasuryStockCommonMember 2023-11-27 2024-02-25 0000040704 us-gaap:TreasuryStockCommonMember 2022-11-28 2023-02-26 0000040704 gis:HelperMainMealsAndSuddenlySaladSideDishesBusinessesMember 2022-08-28 0000040704 gis:HelperMainMealsAndSuddenlySaladSideDishesBusinessesMember 2022-05-30 2022-08-28 0000040704 gis:TntCrustMember 2022-05-30 2022-08-28 0000040704 gis:TntCrustMember 2022-08-28 0000040704 us-gaap:CostOfSalesMember 2023-11-27 2024-02-25 0000040704 us-gaap:CostOfSalesMember 2022-11-28 2023-02-26 0000040704 us-gaap:RestructuringChargesMember 2023-11-27 2024-02-25 0000040704 us-gaap:RestructuringChargesMember 2022-11-28 2023-02-26 0000040704 gis:NorthAmericaFoodserviceMember 2023-05-28 0000040704 gis:InternationalMember 2023-05-28 0000040704 gis:NorthAmericaFoodserviceMember 2023-05-29 2024-02-25 0000040704 gis:NorthAmericaFoodserviceMember 2024-02-25 0000040704 gis:InternationalMember 2023-05-29 2024-02-25 0000040704 gis:InternationalMember 2024-02-25 0000040704 gis:FloatingRateNotesDueNovember82024Member 2023-05-29 2023-08-27 0000040704 gis:FloatingRateNotesDueJuly272023Member 2023-05-29 2023-08-27 0000040704 gis:FloatingRateNotesDueNovember102023Member 2023-02-28 2023-05-28 0000040704 gis:FloatingRateNotesDueMay162023Member 2023-02-28 2023-05-28 0000040704 gis:FixedRateNotesDueApril132029Member 2023-05-28 0000040704 gis:FixedRateNotesDueApril272023Member 2023-05-28 0000040704 gis:FixedRateNotesDueApril132029Member 2023-02-28 2023-05-28 0000040704 gis:FixedRateNotesDueApril272023Member 2023-02-28 2023-05-28 0000040704 gis:FixedRateNotesDueMarch292033Member 2023-02-28 2023-05-28 0000040704 gis:FixedRateNotesDueMarch292033Member 2023-05-28 0000040704 gis:ThirdPartyInterestHolderMember gis:GeneralMillsCerealsLlcMember 2024-02-25 0000040704 gis:ThirdPartyInterestHolderMember gis:GeneralMillsCerealsLlcMember 2023-05-29 2024-02-25 0000040704 us-gaap:PostemploymentRetirementBenefitsMember 2023-11-27 2024-02-25 0000040704 us-gaap:PostemploymentRetirementBenefitsMember 2022-11-28 2023-02-26 0000040704 gis:InternationalMember us-gaap:OperatingSegmentsMember 2023-11-27 2024-02-25 0000040704 gis:InternationalMember us-gaap:OperatingSegmentsMember 2022-11-28 2023-02-26 0000040704 gis:NorthAmericaFoodserviceMember us-gaap:OperatingSegmentsMember 2023-11-27 2024-02-25 0000040704 gis:NorthAmericaFoodserviceMember us-gaap:OperatingSegmentsMember 2022-11-28 2023-02-26 0000040704 gis:PetSegmentMember 2023-11-27 2024-02-25 0000040704 gis:PetSegmentMember 2022-11-28 2023-02-26 0000040704 gis:VegetablesAndOtherMember 2023-11-27 2024-02-25 0000040704 gis:VegetablesAndOtherMember 2022-11-28 2023-02-26 0000040704 us-gaap:OperatingSegmentsMember gis:UnitedStatesCerealOperatingUnitMember 2023-11-27 2024-02-25 0000040704 us-gaap:OperatingSegmentsMember gis:UnitedStatesCerealOperatingUnitMember 2022-11-28 2023-02-26 0000040704 us-gaap:OperatingSegmentsMember gis:CanadaOperatingUnitMember 2023-11-27 2024-02-25 0000040704 us-gaap:OperatingSegmentsMember gis:CanadaOperatingUnitMember 2022-11-28 2023-02-26 0000040704 us-gaap:CommodityContractMember 2024-02-25 0000040704 us-gaap:EnergyRelatedDerivativeMember 2024-02-25 0000040704 gis:AgriculturalRelatedDerivativeMember 2024-02-25 0000040704 us-gaap:CommodityContractMember 2023-05-29 2024-02-25 0000040704 2023-11-26 0000040704 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2022-11-28 2023-02-26 0000040704 us-gaap:AdditionalPaidInCapitalMember 2022-11-28 2023-02-26 0000040704 us-gaap:AdditionalPaidInCapitalMember 2023-11-26 0000040704 us-gaap:RetainedEarningsMember 2023-11-26 0000040704 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2023-11-26 0000040704 us-gaap:NoncontrollingInterestMember 2023-11-26 0000040704 us-gaap:TreasuryStockCommonMember 2024-02-25 0000040704 us-gaap:TreasuryStockCommonMember 2023-11-26 0000040704 2022-11-27 0000040704 us-gaap:NoncontrollingInterestMember 2022-11-27 0000040704 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2022-11-27 0000040704 us-gaap:RetainedEarningsMember 2022-11-27 0000040704 us-gaap:AdditionalPaidInCapitalMember 2022-11-27 0000040704 us-gaap:TreasuryStockCommonMember 2022-11-27 0000040704 us-gaap:TreasuryStockCommonMember 2023-05-28 0000040704 us-gaap:TreasuryStockCommonMember 2023-05-29 2024-02-25 0000040704 us-gaap:TreasuryStockCommonMember 2022-05-29 0000040704 us-gaap:TreasuryStockCommonMember 2022-05-30 2023-02-26 0000040704 us-gaap:AdditionalPaidInCapitalMember 2023-05-28 0000040704 us-gaap:AdditionalPaidInCapitalMember 2022-05-29 0000040704 us-gaap:AdditionalPaidInCapitalMember 2022-05-30 2023-02-26 0000040704 us-gaap:RetainedEarningsMember 2023-05-28 0000040704 us-gaap:RetainedEarningsMember 2022-05-29 0000040704 us-gaap:RetainedEarningsMember 2022-05-30 2023-02-26 0000040704 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2023-05-28 0000040704 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2022-05-29 0000040704 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2022-05-30 2023-02-26 0000040704 gis:CommercialStrategyActionMember 2023-11-27 2024-02-25 0000040704 gis:ActionsPreviouslyAnnouncedMember 2023-11-27 2024-02-25 0000040704 gis:CommercialStrategyActionMember 2022-11-28 2023-02-26 0000040704 gis:ActionsPreviouslyAnnouncedMember 2022-11-28 2023-02-26 0000040704 gis:CommercialStrategyActionMember 2023-05-29 2024-02-25 0000040704 gis:ActionsPreviouslyAnnouncedMember 2023-05-29 2024-02-25 0000040704 gis:CommercialStrategyActionMember 2022-05-30 2023-02-26 0000040704 gis:ActionsPreviouslyAnnouncedMember 2022-05-30 2023-02-26 0000040704 us-gaap:RestructuringChargesMember 2023-05-29 2024-02-25 0000040704 us-gaap:CostOfSalesMember 2023-05-29 2024-02-25 0000040704 us-gaap:RestructuringChargesMember 2022-05-30 2023-02-26 0000040704 us-gaap:CostOfSalesMember 2022-05-30 2023-02-26 0000040704 gis:FloatingRateNotesDueNovember82024Member 2023-08-28 2023-11-26 0000040704 gis:FloatingRateNotesDueNovember102023Member 2023-08-28 2023-11-26 0000040704 gis:FixedRateNotesDueOctober172028Member 2023-08-28 2023-11-26 0000040704 gis:FixedRateNotesDueOctober172028Member 2023-11-26 0000040704 gis:FloatingRateNotesDueOctober172023Member 2023-08-28 2023-11-26 0000040704 us-gaap:ParentMember 2023-05-29 2024-02-25 0000040704 us-gaap:ParentMember 2022-05-30 2023-02-26 0000040704 us-gaap:NoncontrollingInterestMember 2022-05-30 2023-02-26 0000040704 us-gaap:EmployeeStockOptionMember 2023-05-29 2024-02-25 0000040704 us-gaap:EmployeeStockOptionMember 2022-05-30 2023-02-26 0000040704 us-gaap:RestrictedStockUnitsRSUMember 2023-05-29 2024-02-25 0000040704 us-gaap:RestrictedStockUnitsRSUMember 2022-05-30 2023-02-26 0000040704 us-gaap:PensionPlansDefinedBenefitMember 2023-05-29 2024-02-25 0000040704 us-gaap:PensionPlansDefinedBenefitMember 2022-05-30 2023-02-26 0000040704 us-gaap:OtherPostretirementBenefitPlansDefinedBenefitMember 2023-05-29 2024-02-25 0000040704 us-gaap:OtherPostretirementBenefitPlansDefinedBenefitMember 2022-05-30 2023-02-26 0000040704 us-gaap:PostemploymentRetirementBenefitsMember 2023-05-29 2024-02-25 0000040704 us-gaap:PostemploymentRetirementBenefitsMember 2022-05-30 2023-02-26 0000040704 us-gaap:OperatingSegmentsMember 2023-05-29 2024-02-25 0000040704 us-gaap:OperatingSegmentsMember 2022-05-30 2023-02-26 0000040704 gis:NorthAmericaRetailSegmentMember us-gaap:OperatingSegmentsMember 2023-05-29 2024-02-25 0000040704 gis:NorthAmericaRetailSegmentMember us-gaap:OperatingSegmentsMember 2022-05-30 2023-02-26 0000040704 gis:InternationalMember us-gaap:OperatingSegmentsMember 2023-05-29 2024-02-25 0000040704 gis:InternationalMember us-gaap:OperatingSegmentsMember 2022-05-30 2023-02-26 0000040704 gis:PetSegmentMember us-gaap:OperatingSegmentsMember 2023-05-29 2024-02-25 0000040704 gis:PetSegmentMember us-gaap:OperatingSegmentsMember 2022-05-30 2023-02-26 0000040704 gis:NorthAmericaFoodserviceMember us-gaap:OperatingSegmentsMember 2023-05-29 2024-02-25 0000040704 gis:NorthAmericaFoodserviceMember us-gaap:OperatingSegmentsMember 2022-05-30 2023-02-26 0000040704 us-gaap:CorporateNonSegmentMember 2023-05-29 2024-02-25 0000040704 us-gaap:CorporateNonSegmentMember 2022-05-30 2023-02-26 0000040704 gis:UnitedStatesCerealOperatingUnitMember us-gaap:OperatingSegmentsMember 2023-05-29 2024-02-25 0000040704 gis:UnitedStatesCerealOperatingUnitMember us-gaap:OperatingSegmentsMember 2022-05-30 2023-02-26 0000040704 gis:CanadaOperatingUnitMember us-gaap:OperatingSegmentsMember 2023-05-29 2024-02-25 0000040704 gis:CanadaOperatingUnitMember us-gaap:OperatingSegmentsMember 2022-05-30 2023-02-26 0000040704 gis:SnacksMember 2023-05-29 2024-02-25 0000040704 gis:CerealMember 2023-05-29 2024-02-25 0000040704 gis:ConvenientMealsMember 2023-05-29 2024-02-25 0000040704 gis:DoughMember 2023-05-29 2024-02-25 0000040704 gis:PetSegmentMember 2023-05-29 2024-02-25 0000040704 gis:BakingMixesAndIngredientsMember 2023-05-29 2024-02-25 0000040704 gis:YogurtMember 2023-05-29 2024-02-25 0000040704 gis:SuperPremiumIceCreamMember 2023-05-29 2024-02-25 0000040704 gis:VegetablesAndOtherMember 2023-05-29 2024-02-25 0000040704 gis:SnacksMember 2022-05-30 2023-02-26 0000040704 gis:CerealMember 2022-05-30 2023-02-26 0000040704 gis:ConvenientMealsMember 2022-05-30 2023-02-26 0000040704 gis:DoughMember 2022-05-30 2023-02-26 0000040704 gis:PetSegmentMember 2022-05-30 2023-02-26 0000040704 gis:BakingMixesAndIngredientsMember 2022-05-30 2023-02-26 0000040704 gis:YogurtMember 2022-05-30 2023-02-26 0000040704 gis:SuperPremiumIceCreamMember 2022-05-30 2023-02-26 0000040704 gis:VegetablesAndOtherMember 2022-05-30 2023-02-26 0000040704 us-gaap:NoncontrollingInterestMember 2023-05-28 0000040704 us-gaap:NoncontrollingInterestMember 2022-05-29 0000040704 us-gaap:OperatingSegmentsMember gis:UnitedStatesMealsAndBakingOperatingUnitMember 2023-11-27 2024-02-25 0000040704 us-gaap:OperatingSegmentsMember gis:UnitedStatesSnacksOperatingUnitMember 2023-11-27 2024-02-25 0000040704 us-gaap:OperatingSegmentsMember gis:UnitedStatesMealsAndBakingOperatingUnitMember 2023-05-29 2024-02-25 0000040704 us-gaap:OperatingSegmentsMember gis:UnitedStatesSnacksOperatingUnitMember 2023-05-29 2024-02-25 0000040704 us-gaap:OperatingSegmentsMember gis:UnitedStatesMealsAndBakingOperatingUnitMember 2022-11-28 2023-02-26 0000040704 us-gaap:OperatingSegmentsMember gis:UnitedStatesSnacksOperatingUnitMember 2022-11-28 2023-02-26 0000040704 us-gaap:OperatingSegmentsMember gis:UnitedStatesMealsAndBakingOperatingUnitMember 2022-05-30 2023-02-26 0000040704 us-gaap:OperatingSegmentsMember gis:UnitedStatesSnacksOperatingUnitMember 2022-05-30 2023-02-26 0000040704 us-gaap:LineOfCreditMember 2024-02-25 0000040704 2023-08-28 2023-11-26 0000040704 gis:EuroDenominatedBondsUsedForHedgingMember 2024-02-25 0000040704 gis:FourPointSevenFixedRateNotesMember 2023-11-27 2024-02-25 0000040704 us-gaap:TreasuryLockMember 2023-11-27 2024-02-25 0000040704 gis:FourPointSevenFixedRateNotesMember 2024-02-25 0000040704 gis:ThreePointSixFiveFixedRateNoteMember 2024-02-25 0000040704 gis:FixedRateNotesDueNovember182025Member 2022-11-27 0000040704 gis:ThreePointSixFiveFixedRateNoteMember 2023-11-27 2024-02-25 0000040704 gis:FixedRateNotesDueNovember182025Member 2022-08-29 2022-11-27 0000040704 gis:FloatingRateNotesDueMay162023Member 2022-08-29 2022-11-27 0000040704 gis:FixedRateNotesDueNovember112022Member 2022-08-29 2022-11-27 0000040704 gis:FixedRateNotesDueOctober122022Member 2022-08-29 2022-11-27 0000040704 gis:FixedRateNotesDueNovember112022Member 2022-11-27 0000040704 gis:FixedRateNotesDueOctober122022Member 2022-11-27 0000040704 us-gaap:TreasuryStockCommonMember 2023-02-26 0000040704 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2024-02-25 0000040704 us-gaap:AdditionalPaidInCapitalMember 2024-02-25 0000040704 us-gaap:NoncontrollingInterestMember 2024-02-25 0000040704 us-gaap:RetainedEarningsMember 2024-02-25 0000040704 us-gaap:CorporateAndOtherMember 2023-11-27 2024-02-25 0000040704 us-gaap:CorporateAndOtherMember 2022-11-28 2023-02-26 0000040704 us-gaap:CorporateAndOtherMember 2023-05-29 2024-02-25 0000040704 us-gaap:CorporateAndOtherMember 2022-05-30 2023-02-26 0000040704 us-gaap:EmployeeSeveranceMember 2024-02-25 0000040704 us-gaap:OtherRestructuringMember 2024-02-25 0000040704 gis:AssetImpairmentMember 2024-02-25 0000040704 gis:OtherAssetWriteOffsMember 2024-02-25 0000040704 2023-05-29 2023-11-26 iso4217:EUR iso4217:USD xbrli:pure xbrli:shares iso4217:USD xbrli:shares
 
 
 
 
 
 
 
 
 
 
 
 
 
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
10-Q
(Mark One)
 
 
QUARTERLY
 
REPORT
 
PURSUANT
 
TO
 
SECTION
 
13
 
OR
 
15(d)
 
OF
 
THE
 
SECURITIES
 
EXCHANGE
 
ACT
 
OF
 
1934
FOR THE QUARTERLY
 
PERIOD ENDED
FEBRUARY 25, 2024
 
TRANSITION
 
REPORT
 
PURSUANT
 
TO
 
SECTION
 
13
 
OR
 
15(d)
 
OF
 
THE
 
SECURITIES
 
EXCHANGE
 
ACT
 
OF
 
1934
FOR THE TRANSITION PERIOD FROM
 
TO
 
Commission file number:
001-01185
________________
GENERAL MILLS, INC.
(Exact name of registrant as specified in its charter)
Delaware
 
41-0274440
(State or other jurisdiction of
(I.R.S. Employer
incorporation or organization)
Identification No.)
Number One General Mills Boulevard
 
Minneapolis
,
Minnesota
55426
(Address of principal executive offices)
(Zip Code)
(763)
764-7600
(Registrant’s telephone number,
 
including area code)
Securities registered pursuant to Section 12(b) of the Act:
 
Title of each class
 
Trading Symbol(s)
 
Name of each exchange
on which registered
Common Stock, $.10 par value
 
GIS
 
New York Stock Exchange
0.125% Notes due 2025
GIS 25A
New York Stock Exchange
0.450% Notes due 2026
 
GIS 26
 
New York Stock Exchange
1.500% Notes due 2027
 
GIS 27
 
New York Stock Exchange
3.907% Notes due 2029
GIS 29
New York Stock Exchange
________________
Indicate
 
by
 
check
 
mark
 
whether
 
the
 
registrant
 
(1)
 
has
 
filed
 
all
 
reports
 
required
 
to
 
be
 
filed
 
by
 
Section
 
13
 
or
 
15(d)
 
of
 
the
 
Securities
Exchange Act of 1934
 
during the preceding 12
 
months (or for such shorter
 
period that the registrant
 
was required to file such
 
reports),
and (2) has been subject to such filing requirements for the past 90 days.
 
Yes
 
No
Indicate
 
by
 
check
 
mark
 
whether
 
the
 
registrant
 
has
 
submitted
 
electronically
 
every
 
Interactive
 
Data
 
File
 
required
 
to
 
be
 
submitted
pursuant to Rule 405
 
of Regulation S-T (§
 
232.405 of this chapter) during
 
the preceding 12 months (or
 
for such shorter period that
 
the
registrant was required to submit such files).
Yes
 
 
No
Indicate
 
by
 
check
 
mark
 
whether
 
the
 
registrant
 
is
 
a
 
large
 
accelerated
 
filer,
 
an
 
accelerated
 
filer,
 
a
 
non-accelerated
 
filer,
 
a
 
smaller
reporting
 
company,
 
or
 
an
 
emerging
 
growth
 
company.
 
See
 
the
 
definitions
 
of
 
“large
 
accelerated
 
filer,”
 
“accelerated
 
filer,”
 
“smaller
reporting company,” and
 
“emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer
Accelerated filer
 
Non-accelerated filer
Smaller reporting company
Emerging growth company
 
If
 
an
 
emerging
 
growth
 
company,
 
indicate
 
by
 
check
 
mark
 
if
 
the
 
registrant
 
has
 
elected
 
not
 
to
 
use
 
the
 
extended
 
transition
 
period
 
for
complying with any new or revised financial accounting standards provided
 
pursuant to Section 13(a) of the Exchange Act.
 
Indicate by check mark whether the registrant is a shell company (as defined
 
in Rule 12b-2 of the Exchange Act).
Yes
 
No
Number
 
of
 
shares
 
of
 
Common
 
Stock
 
outstanding
 
as
 
of
 
March
 
13,
 
2024:
564,548,763
 
(excluding
190,080,991
 
shares
 
held
 
in
 
the
treasury).
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
4
 
PART
 
I.
 
FINANCIAL INFORMATION
Item 1.
 
Financial Statements.
Consolidated Statements of Earnings
GENERAL MILLS, INC. AND SUBSIDIARIES
(Unaudited) (In Millions, Except per Share Data)
Quarter Ended
Nine-Month Period Ended
Feb. 25, 2024
Feb. 26, 2023
Feb. 25, 2024
Feb. 26, 2023
Net sales
$
5,099.2
$
5,125.9
$
15,143.3
$
15,064.2
Cost of sales
3,391.8
3,461.1
9,899.5
10,246.6
Selling, general, and administrative expenses
790.9
946.9
2,460.7
2,632.5
Divestitures gain, net
-
(13.7)
-
(444.6)
Restructuring, impairment, and other exit costs
5.8
1.4
130.6
14.1
Operating profit
910.7
730.2
2,652.5
2,615.6
Benefit plan non-service income
(18.6)
(21.6)
(55.7)
(65.0)
Interest, net
121.7
98.3
356.5
277.5
Earnings before income taxes and after-tax earnings
 
from
 
 
joint ventures
807.6
653.5
2,351.7
2,403.1
Income taxes
149.3
108.3
458.5
471.5
After-tax earnings from joint ventures
18.0
12.7
65.7
57.9
Net earnings, including earnings attributable to
 
noncontrolling interests
676.3
557.9
1,958.9
1,989.5
Net earnings attributable to noncontrolling interests
6.2
4.8
19.8
10.5
Net earnings attributable to General Mills
$
670.1
$
553.1
$
1,939.1
$
1,979.0
Earnings per share – basic
$
1.18
$
0.94
$
3.35
$
3.32
Earnings per share – diluted
$
1.17
$
0.92
$
3.33
$
3.28
See accompanying notes to consolidated financial statements.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
5
 
Consolidated Statements of Comprehensive Income
GENERAL MILLS, INC. AND SUBSIDIARIES
(Unaudited) (In Millions)
Quarter Ended
Nine-Month Period Ended
Feb. 25, 2024
Feb. 26, 2023
Feb. 25, 2024
Feb. 26, 2023
Net earnings, including earnings attributable to
 
noncontrolling interests
$
676.3
$
557.9
$
1,958.9
$
1,989.5
Other comprehensive income (loss), net of tax:
Foreign currency translation
2.4
12.5
(38.0)
(98.7)
Other fair value changes:
Hedge derivatives
(6.9)
(5.7)
(7.3)
(23.2)
Reclassification to earnings:
Foreign currency translation
-
-
-
(7.4)
Hedge derivatives
(0.1)
18.9
(2.3)
18.5
Amortization of losses and prior service costs
9.1
13.9
27.4
42.2
Other comprehensive income (loss), net of tax
4.5
39.6
(20.2)
(68.6)
Total comprehensive
 
income
 
680.8
597.5
1,938.7
1,920.9
Comprehensive income attributable to noncontrolling
 
interests
6.0
4.9
20.0
9.9
Comprehensive income attributable to General Mills
$
674.8
$
592.6
$
1,918.7
$
1,911.0
See accompanying notes to consolidated financial statements.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
6
 
Consolidated Balance Sheets
GENERAL MILLS, INC. AND SUBSIDIARIES
(In Millions, Except Par Value)
Feb. 25, 2024
May 28, 2023
(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents
$
588.6
$
585.5
Receivables
1,771.1
1,683.2
Inventories
1,828.0
2,172.0
Prepaid expenses and other current assets
466.8
735.7
Total current
 
assets
4,654.5
5,176.4
Land, buildings, and equipment
3,643.6
3,636.2
Goodwill
14,433.7
14,511.2
Other intangible assets
6,957.2
6,967.6
Other assets
1,171.5
1,160.3
Total assets
$
30,860.5
$
31,451.7
LIABILITIES AND EQUITY
Current liabilities:
Accounts payable
$
3,613.5
$
4,194.2
Current portion of long-term debt
812.2
1,709.1
Notes payable
686.7
31.7
Other current liabilities
1,949.5
1,600.7
Total current
 
liabilities
7,061.9
7,535.7
Long-term debt
11,015.1
9,965.1
Deferred income taxes
2,023.5
2,110.9
Other liabilities
1,068.7
1,140.0
Total liabilities
21,169.2
20,751.7
Stockholders’ equity:
Common stock,
754.6
 
shares issued, $
0.10
 
par value
75.5
75.5
Additional paid-in capital
1,210.3
1,222.4
Retained earnings
20,416.7
19,838.6
Common stock in treasury,
 
at cost, shares of
190.1
 
and
168.0
(9,968.4)
(8,410.0)
Accumulated other comprehensive loss
(2,297.3)
(2,276.9)
Total stockholders’
 
equity
9,436.8
10,449.6
Noncontrolling interests
254.5
250.4
Total equity
9,691.3
10,700.0
Total liabilities and equity
$
30,860.5
$
31,451.7
See accompanying notes to consolidated financial statements.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
7
 
Consolidated Statements of Total
 
Equity
GENERAL MILLS, INC. AND SUBSIDIARIES
(Unaudited) (In Millions, Except per Share Data)
Quarter Ended
Feb. 25, 2024
Feb. 26, 2023
Shares
Amount
Shares
Amount
Total equity,
 
beginning balance
$
9,631.9
$
10,372.1
Common stock,
1
 
billion shares authorized, $
0.10
 
par value
754.6
75.5
754.6
75.5
Additional paid-in capital:
Beginning balance
1,201.8
1,155.3
Stock compensation plans
(11.1)
21.9
Unearned compensation related to stock unit awards
1.8
(14.8)
Earned compensation
17.8
28.7
Ending balance
1,210.3
1,191.1
Retained earnings:
Beginning balance
20,080.9
18,991.9
Net earnings attributable to General Mills
670.1
553.1
Cash dividends declared ($
0.59
 
and $
0.54
 
per share)
(334.3)
(318.5)
Ending balance
20,416.7
19,226.5
Common stock in treasury:
Beginning balance
(185.7)
(9,677.4)
(164.4)
(8,023.5)
Shares purchased, including excise tax of $
2.8
 
and
 
$
0.4
 
million
(4.7)
(303.1)
(2.9)
(251.0)
Stock compensation plans
0.3
12.1
1.1
54.4
Ending balance
(190.1)
(9,968.4)
(166.2)
(8,220.1)
Accumulated other comprehensive loss:
Beginning balance
(2,302.0)
(2,078.0)
Other comprehensive income
4.7
39.5
Ending balance
(2,297.3)
(2,038.5)
Noncontrolling interests:
Beginning balance
253.1
250.9
Comprehensive income
6.0
4.9
Distributions to noncontrolling interest holders
(4.6)
(6.6)
Ending balance
254.5
249.2
Total equity,
 
ending balance
$
9,691.3
$
10,483.7
See accompanying notes to consolidated financial statements.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
8
Consolidated Statements of Total
 
Equity
GENERAL MILLS, INC. AND SUBSIDIARIES
(Unaudited) (In Millions, Except per Share Data)
Nine-Month Period Ended
Feb. 25, 2024
Feb. 26, 2023
Shares
Amount
Shares
Amount
Total equity,
 
beginning balance
$
10,700.0
$
10,788.0
Common stock,
1
 
billion shares authorized, $
0.10
 
par value
754.6
75.5
754.6
75.5
Additional paid-in capital:
Beginning balance
1,222.4
1,182.9
Stock compensation plans
(10.3)
23.8
Unearned compensation related to stock unit awards
(78.1)
(100.6)
Earned compensation
76.3
85.0
Ending balance
1,210.3
1,191.1
Retained earnings:
Beginning balance
19,838.6
18,532.6
Net earnings attributable to General Mills
1,939.1
1,979.0
Cash dividends declared ($
2.36
 
and $
2.16
 
per share)
(1,361.0)
(1,285.1)
Ending balance
20,416.7
19,226.5
Common stock in treasury:
Beginning balance
(168.0)
(8,410.0)
(155.7)
(7,278.1)
Shares purchased, including excise tax of $
15.0
 
and
 
 
$
0.4
 
million
(23.5)
(1,616.6)
(15.0)
(1,152.3)
Stock compensation plans
1.4
58.2
4.5
210.3
Ending balance
(190.1)
(9,968.4)
(166.2)
(8,220.1)
Accumulated other comprehensive loss:
Beginning balance
(2,276.9)
(1,970.5)
Other comprehensive loss
(20.4)
(68.0)
Ending balance
(2,297.3)
(2,038.5)
Noncontrolling interests:
Beginning balance
250.4
245.6
Comprehensive income
20.0
9.9
Distributions to noncontrolling interest holders
(16.6)
(11.4)
Change in ownership interest
0.7
-
Divestiture
-
5.1
Ending balance
254.5
249.2
Total equity,
 
ending balance
$
9,691.3
$
10,483.7
See accompanying notes to consolidated financial statements.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
9
 
Consolidated Statements of Cash Flows
GENERAL MILLS, INC. AND SUBSIDIARIES
(Unaudited) (In Millions)
Nine-Month Period Ended
Feb. 25, 2024
Feb. 26, 2023
Cash Flows - Operating Activities
Net earnings, including earnings attributable to noncontrolling interests
$
1,958.9
$
1,989.5
Adjustments to reconcile net earnings to net cash provided by operating activities:
Depreciation and amortization
412.2
411.0
After-tax earnings from joint ventures
(65.7)
(57.9)
Distributions of earnings from joint ventures
31.4
36.6
Stock-based compensation
76.7
86.7
Deferred income taxes
(85.5)
(71.2)
Pension and other postretirement benefit plan contributions
(20.0)
(20.2)
Pension and other postretirement benefit plan costs
(20.2)
(20.2)
Divestitures gain, net
-
(444.6)
Restructuring, impairment, and other exit costs
119.7
(14.6)
Changes in current assets and liabilities, excluding the effects of
 
 
acquisitions and divestitures
(9.6)
21.3
Other, net
41.0
110.6
Net cash provided by operating activities
2,438.9
2,027.0
Cash Flows - Investing Activities
Purchases of land, buildings, and equipment
(485.6)
(351.3)
Acquisition, net of cash acquired
(25.5)
(251.5)
Proceeds from divestitures, net of cash divested
-
633.1
Investments in affiliates, net
(1.5)
(30.8)
Proceeds from disposal of land, buildings, and equipment
0.2
0.8
Other, net
4.8
(6.4)
Net cash used by investing activities
(507.6)
(6.1)
Cash Flows - Financing Activities
Change in notes payable
654.5
159.2
Issuance of long-term debt
1,000.0
501.8
Payment of long-term debt
(900.0)
(600.0)
Proceeds from common stock issued on exercised options
11.1
168.0
Purchases of common stock for treasury
(1,601.6)
(1,152.3)
Dividends paid
(1,028.0)
(967.4)
Distributions to noncontrolling interest holders
(16.6)
(11.4)
Other, net
(47.0)
(53.5)
Net cash used by financing activities
(1,927.6)
(1,955.6)
Effect of exchange rate changes on cash and cash equivalents
(0.6)
(16.0)
Increase in cash and cash equivalents
3.1
49.3
Cash and cash equivalents - beginning of year
585.5
569.4
Cash and cash equivalents - end of period
$
588.6
$
618.7
Cash Flow from changes in current assets and liabilities, excluding the effects
 
of
 
 
acquisitions and divestitures:
Receivables
$
(83.8)
$
(132.4)
Inventories
347.8
(237.0)
Prepaid expenses and other current assets
269.4
151.5
Accounts payable
(543.7)
(41.6)
Other current liabilities
0.7
280.8
Changes in current assets and liabilities
$
(9.6)
$
21.3
See accompanying notes to consolidated financial statements.
 
10
GENERAL MILLS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED
 
FINANCIAL STATEMENTS
(Unaudited)
 
(1) Background
The accompanying
 
Consolidated Financial
 
Statements of
 
General Mills,
 
Inc. (we,
 
us, our,
 
General Mills,
 
or the Company)
 
have been
prepared in
 
accordance with
 
accounting principles
 
generally accepted
 
in the
 
United States
 
(GAAP) for
 
interim financial
 
information
and with
 
the rules
 
and regulations
 
for reporting
 
on Form
 
10-Q. Accordingly,
 
they do
 
not include
 
certain information
 
and disclosures
required
 
for
 
comprehensive
 
financial
 
statements.
 
In
 
the
 
opinion
 
of
 
management,
 
all
 
adjustments
 
considered
 
necessary
 
for
 
a
 
fair
presentation have
 
been included
 
and are
 
of a
 
normal recurring
 
nature, including
 
the elimination
 
of all
 
intercompany transactions
 
and
any
 
noncontrolling
 
interests’
 
share
 
of
 
those
 
transactions.
 
Operating
 
results
 
for
 
the
 
fiscal
 
quarter
 
ended
 
February
 
25,
 
2024,
 
are
 
not
necessarily indicative of the results that may be expected for the fiscal year ending
 
May 26, 2024.
 
These
 
statements
 
should
 
be
 
read
 
in
 
conjunction
 
with
 
the
 
Consolidated
 
Financial
 
Statements
 
and
 
footnotes
 
included
 
in
 
our
 
Annual
Report on Form
 
10-K for the fiscal
 
year ended May
 
28, 2023. The
 
accounting policies used
 
in preparing these
 
Consolidated Financial
Statements are the same as those described in Note 2 to the Consolidated Financial
 
Statements in that Form 10-K with the exception of
new requirements adopted in the first quarter of fiscal 2024.
In the first quarter
 
of fiscal 2024, we
 
adopted optional accounting guidance
 
to ease the burden
 
in accounting for reference
 
rate reform.
The new
 
standard provides
 
temporary expedients
 
and exceptions
 
to existing
 
accounting requirements
 
for contract
 
modifications
 
and
hedge accounting
 
related to transitioning
 
from discontinued
 
reference rates.
 
This resulted in
 
modifying contracts,
 
where necessary,
 
to
apply a new reference rate,
 
primarily SOFR. The adoption of
 
this accounting guidance did not
 
have a material impact on our results
 
of
operations or financial position.
In the
 
first quarter
 
of fiscal
 
2024, we adopted
 
new requirements
 
for enhanced
 
disclosures related
 
to supplier
 
financing programs.
 
The
new standard requires
 
disclosure of the
 
key terms of
 
the program and
 
a rollforward of
 
the related obligation
 
during the annual
 
period,
including
 
the
 
amount
 
of
 
obligations
 
confirmed
 
and
 
obligations
 
subsequently
 
paid.
 
We
 
have
 
historically
 
presented
 
the
 
key
 
terms
 
of
these programs
 
and the
 
associated obligation
 
outstanding
 
(please see
 
Note 6).
 
The rollforward
 
requirement is
 
effective
 
for us
 
in our
fiscal 2025. The adoption did not have a material impact on our financial
 
statements and related disclosures.
Certain terms used throughout this report are defined in the “Glossary” section below.
 
 
(2) Acquisition and Divestiture
During
 
the first
 
quarter
 
of fiscal
 
2023,
 
we
 
acquired
 
TNT Crust,
 
a
 
manufacturer
 
of high-quality
 
frozen pizza
 
crusts
 
for
 
regional
 
and
national pizza
 
chains, foodservice
 
distributors, and
 
retail outlets,
 
for a
 
purchase price
 
of $
253.0
 
million. We
 
financed the
 
transaction
with U.S. commercial paper.
 
We consolidated
 
the TNT Crust business into
 
our Consolidated Balance Sheets
 
and recorded goodwill
 
of
$
156.7
 
million. The
 
goodwill is
 
included in
 
the North
 
America Foodservice
 
segment and
 
is not
 
deductible for
 
tax purposes.
 
The pro
forma effects of this acquisition were not material.
 
During the
 
first quarter
 
of fiscal
 
2023,
 
we completed
 
the sale
 
of our
 
Helper main
 
meals and
 
Suddenly
 
Salad side
 
dishes business
 
to
Eagle Family Foods Group for $
606.8
 
million and recorded a pre-tax gain of $
442.2
 
million.
 
(3) Restructuring, Impairment, and Other Exit Costs
Restructuring and impairment charges were as follows:
 
 
 
 
 
 
 
 
 
 
 
 
Quarter Ended
Nine-Month Period Ended
In Millions
Feb. 25, 2024
Feb. 26, 2023
Feb. 25, 2024
Feb. 26, 2023
Goodwill impairment
$
-
$
-
$
117.1
$
-
Commercial strategy actions
9.0
-
14.1
-
(Recoveries) charges associated with restructuring actions
 
previously announced
(3.1)
2.1
16.4
16.0
Total
 
$
5.9
$
2.1
$
147.6
$
16.0
In
 
the
 
third
 
quarter
 
of
 
fiscal
 
2024,
 
we
 
did
 
not
 
undertake
 
any
 
new
 
restructuring
 
actions.
 
We
 
recorded
 
$
9.0
 
million
 
of
 
restructuring
charges
 
in
 
the
 
third
 
quarter
 
of
 
fiscal
 
2024
 
and
 
$
14.1
 
million
 
of
 
restructuring
 
charges
 
in
 
the
 
nine-month
 
period
 
ended
 
February
 
25,
2024, related to commercial strategy
 
actions approved in the second quarter
 
of fiscal 2024. We
 
recorded a $
3.1
 
million net recovery of
restructuring
 
charges
 
in
 
the
 
third
 
quarter
 
of
 
fiscal
 
2024
 
and
 
$
16.4
 
million
 
of
 
restructuring
 
charges
 
in
 
the
 
nine-month
 
period
 
ended
 
 
 
11
February
 
25,
 
2024,
 
related
 
to
 
restructuring
 
actions
 
previously
 
announced.
 
We
 
recorded
 
$
2.1
 
million
 
of
 
restructuring
 
charges
 
in
 
the
third quarter
 
of fiscal
 
2023
 
and $
16.0
 
million of
 
restructuring charges
 
in the
 
nine-month period
 
ended February
 
26, 2023,
 
related to
restructuring actions previously announced.
 
We expect these actions to
 
be completed by the end of fiscal 2026.
In the third
 
quarter of fiscal
 
2024, we decreased
 
the estimate of
 
restructuring charges
 
that we expect
 
to incur related
 
to our previously
announced
 
actions
 
to enhance
 
the
 
efficiency
 
of our
 
global
 
supply
 
chain
 
structure.
 
We
 
expect to
 
incur
 
approximately
 
$
44
 
million
 
of
restructuring charges and project-related costs related
 
to these actions, of which approximately $
25
 
million will be cash. These charges
are
 
expected
 
to
 
consist
 
of
 
approximately
 
$
24
 
million
 
of
 
severance
 
and
 
$
20
 
million
 
of
 
other
 
costs,
 
primarily
 
$
8
 
million
 
of
 
asset
impairment and $
13
 
million of asset write-offs. We
 
expect these actions to be completed by the end of fiscal 2025.
 
We
 
paid
 
net
 
$
27.9
 
million
 
of cash
 
in
 
the
 
nine-month
 
period
 
ended
 
February
 
25,
 
2024,
 
related
 
to
 
restructuring
 
actions.
 
We
 
paid
 
net
$
30.6
 
million of cash in the same period of fiscal 2023.
In the second
 
quarter of fiscal
 
2024, we recorded
 
a $
117.1
 
million non-cash goodwill
 
impairment charge
 
related to our Latin
 
America
reporting unit. Please see Note 4 for additional information.
Restructuring and impairment charges and project-related
 
costs are recorded in our Consolidated Statements of Earnings as follows:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Quarter Ended
Nine-Month Period Ended
In Millions
Feb. 25, 2024
Feb. 26, 2023
Feb. 25, 2024
Feb. 26, 2023
Restructuring, impairment, and other exit costs
$
5.8
$
1.4
$
130.6
$
14.1
Cost of sales
0.1
0.7
17.0
1.9
Total restructuring
 
and impairment charges
$
5.9
$
2.1
$
147.6
$
16.0
Project-related costs classified in cost of sales
$
0.5
$
-
$
1.6
$
-
The roll forward of our restructuring and other exit cost reserves, included
 
in other current liabilities, is as follows:
 
 
 
 
 
 
In Millions
Total
Reserve balance as of May 28, 2023
$
47.7
Fiscal 2024 net recoveries, including foreign currency translation
(0.1)
Utilized in fiscal 2024
(27.7)
Reserve balance as of Feb. 25, 2024
$
19.9
The reserve balance primarily consists of expected severance payments
 
associated with restructuring actions.
 
The charges
 
recognized in
 
the roll forward
 
of our reserves
 
for restructuring
 
and other exit
 
costs do not
 
include items
 
charged
 
directly
to expense
 
(e.g., asset
 
impairment charges,
 
accelerated depreciation,
 
the gain
 
or loss
 
on the
 
sale of
 
restructured assets,
 
and the
 
write-
off
 
of
 
spare parts)
 
and other
 
periodic
 
exit costs
 
are
 
recognized
 
as incurred,
 
as those
 
items are
 
not reflected
 
in our
 
restructuring
 
and
other exit cost reserves on our Consolidated Balance Sheets.
 
(4) Goodwill and Other Intangible Assets
The components of goodwill and other intangible assets are as follows:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
In Millions
Feb. 25, 2024
May 28, 2023
Goodwill
$
14,433.7
$
14,511.2
Other intangible assets:
Intangible assets not subject to amortization:
Brands and other indefinite-lived intangibles
6,715.7
6,712.4
Intangible assets subject to amortization:
Customer relationships and other finite-lived intangibles
387.0
386.3
Less accumulated amortization
(145.5)
(131.1)
Intangible assets subject to amortization, net
241.5
255.2
Other intangible assets
6,957.2
6,967.6
Total
$
21,390.9
$
21,478.8
 
 
 
12
Based on the
 
carrying value of
 
finite-lived intangible assets
 
as of February
 
25, 2024, annual amortization
 
expense for each of
 
the next
five fiscal years is estimated to be approximately $
20
 
million.
The changes in the carrying amount of goodwill during the nine-month period
 
ended February 25, 2024, were as follows:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
In Millions
North America
Retail
Pet
North America
Foodservice
International
Corporate and
Joint Ventures
Total
Balance as of May 28, 2023
$
6,542.4
$
6,062.8
$
805.6
$
708.4
$
392.0
$
14,511.2
Acquisition
-
-
-
-
26.9
26.9
Impairment charge
-
-
-
(117.1)
-
(117.1)
Other activity, primarily
 
 
foreign currency translation
1.0
-
(0.1)
8.3
3.5
12.7
Balance as of Feb. 25, 2024
$
6,543.4
$
6,062.8
$
805.5
$
599.6
$
422.4
$
14,433.7
The changes in the carrying amount of other intangible assets during the nine-month
 
period ended February 25, 2024, were as follows:
 
 
 
 
 
 
In Millions
Total
Balance as of May 28, 2023
$
6,967.6
Amortization, net of foreign currency translation
(10.4)
Balance as of Feb. 25, 2024
$
6,957.2
Our
 
annual
 
goodwill
 
and
 
indefinite-lived
 
intangible
 
assets
 
impairment
 
test
 
was
 
performed
 
on
 
the
 
first
 
day
 
of
 
the
 
second
 
quarter
 
of
fiscal 2024. As a
 
result of lower future profitability
 
projections for our Latin
 
America reporting unit, we
 
determined that the fair
 
value
of the reporting unit was
 
less than its book value and
 
recorded a $
117.1
 
million non-cash goodwill impairment
 
charge in restructuring,
impairment,
 
and
 
other
 
exit
 
costs
 
in
 
our
 
Consolidated
 
Statements
 
of
 
Earnings.
 
Our
 
estimates
 
of
 
fair
 
value
 
for
 
goodwill
 
impairment
testing were determined based on a discounted cash flow model and
 
the fair value is a Level 3 asset in the fair value hierarchy.
All other intangible
 
asset fair values
 
were substantially
 
in excess of
 
the carrying
 
values, except for
 
the
True Chews
 
and
Uncle Toby’s
brand intangible
 
assets. In
 
addition, while
 
having significant
 
coverage as
 
of our
 
fiscal 2024
 
assessment date,
 
the
Progresso
,
Nudges
,
Top
 
Chews
,
 
and
EPIC
 
brand
 
intangible
 
assets
 
had
 
risk
 
of
 
decreasing
 
coverage.
 
We
 
will
 
continue
 
to
 
monitor
 
these
 
businesses
 
for
potential impairment.
 
(5) Inventories
The components of inventories were as follows:
 
 
 
 
 
 
 
 
 
 
 
In Millions
Feb. 25, 2024
May 28, 2023
Finished goods
$
1,772.1
$
2,066.9
Raw materials and packaging
501.2
572.2
Grain
103.3
133.8
Excess of FIFO over LIFO cost
(548.6)
(600.9)
Total
$
1,828.0
$
2,172.0
 
 
(6) Risk Management Activities
 
Many commodities we
 
use in the
 
production and distribution
 
of our products
 
are exposed to
 
market price risks.
 
We
 
utilize derivatives
to manage price risk for our principal
 
ingredients and energy costs, including
 
grains (oats, wheat, and corn), oils
 
(principally soybean),
dairy products, natural
 
gas, and diesel fuel.
 
Our primary objective
 
when entering into
 
these derivative contracts
 
is to achieve
 
certainty
with
 
regard
 
to
 
the
 
future
 
price
 
of
 
commodities
 
purchased
 
for
 
use
 
in
 
our
 
supply
 
chain.
 
We
 
manage
 
our
 
exposures
 
through
 
a
combination of purchase orders, long-term
 
contracts with suppliers, exchange-traded
 
futures and options, and over-the-counter
 
options
and swaps.
 
We
 
offset
 
our exposures
 
based on
 
current and
 
projected market
 
conditions and
 
generally seek
 
to acquire
 
the inputs
 
at as
close as possible to or below our planned cost.
We
 
use derivatives
 
to manage
 
our exposure
 
to changes
 
in commodity
 
prices. We
 
do not
 
perform the
 
assessments required
 
to achieve
hedge
 
accounting
 
for
 
commodity
 
derivative
 
positions.
 
Accordingly,
 
the
 
changes
 
in
 
the
 
values
 
of
 
these
 
derivatives
 
are
 
recorded
currently in cost of sales in our Consolidated Statements of Earnings.
 
 
13
Although we do
 
not meet the
 
criteria for
 
cash flow hedge
 
accounting, we believe
 
that these instruments
 
are effective
 
in achieving our
objective of providing certainty
 
in the future price of commodities purchased
 
for use in our supply chain.
 
Accordingly, for
 
purposes of
measuring
 
segment
 
operating
 
performance,
 
these
 
gains
 
and
 
losses
 
are
 
reported
 
in
 
unallocated
 
corporate
 
items
 
outside
 
of
 
segment
operating results
 
until such time
 
that the exposure
 
we are managing
 
affects earnings.
 
At that time,
 
we reclassify
 
the gain or
 
loss from
unallocated
 
corporate
 
items
 
to
 
segment
 
operating
 
profit,
 
allowing
 
our
 
operating
 
segments
 
to
 
realize
 
the
 
economic
 
effects
 
of
 
the
derivative without experiencing any resulting mark-to-market volatility,
 
which remains in unallocated corporate items.
 
Unallocated corporate items for the quarters and nine-month periods ended
 
February 25, 2024, and February 26, 2023, included:
 
 
 
 
 
 
 
Quarter Ended
Nine-Month Period Ended
In Millions
Feb. 25, 2024
Feb. 26, 2023
Feb. 25, 2024
Feb. 26, 2023
Net loss on mark-to-market valuation of certain
 
 
commodity positions
$
(24.5)
$
(30.2)
$
(34.3)
$
(123.4)
Net loss (gain) on commodity positions reclassified from
 
 
unallocated corporate items to segment operating profit
11.7
(21.5)
29.5
(85.0)
Net mark-to-market revaluation of certain grain inventories
(12.9)
(14.9)
(1.1)
(58.0)
Net mark-to-market valuation of certain commodity
 
 
positions recognized in unallocated corporate items
$
(25.7)
$
(66.6)
$
(5.9)
$
(266.4)
 
As
 
of
 
February
 
25,
 
2024,
 
the
 
net
 
notional
 
value
 
of
 
commodity
 
derivatives
 
was
 
$
306.3
 
million,
 
of
 
which
 
$
124.2
 
million
 
related
 
to
energy inputs and $
182.1
 
million related to agricultural inputs. These contracts relate to inputs that generally
 
will be utilized within the
next
12
 
months.
In
 
the
 
third
 
quarter
 
of
 
fiscal
 
2024,
 
in
 
advance
 
of
 
our
 
$
500.0
 
million
 
debt
 
issuance,
 
we
 
entered
 
into
 
and
 
settled
 
$
250.0
 
million
 
of
treasury locks, resulting in a gain of $
0.3
 
million.
 
We
 
also have net
 
investments in
 
foreign subsidiaries
 
that are denominated
 
in euros. As
 
of February
 
25, 2024, we
 
hedged a portion
 
of
these investments with €
2,967.5
 
million of euro-denominated bonds.
The
 
fair
 
values
 
of
 
the
 
derivative
 
positions
 
used
 
in
 
our
 
risk
 
management
 
activities
 
and
 
other
 
assets
 
recorded
 
at
 
fair
 
value
 
were
 
not
material as of February 25, 2024,
 
and were Level 1 or Level 2 assets and
 
liabilities in the fair value hierarchy.
 
We did
 
not significantly
change our valuation techniques from prior periods.
 
We
 
offer
 
certain
 
suppliers
 
access
 
to
 
third-party
 
services
 
that
 
allow
 
them
 
to
 
view
 
our
 
scheduled
 
payments
 
online.
 
The
 
third-party
services also
 
allow suppliers
 
to finance
 
advances on
 
our scheduled
 
payments at
 
the sole
 
discretion of
 
the supplier
 
and the third
 
party.
We
 
have no
 
economic interest
 
in these
 
financing arrangements
 
and no
 
direct relationship
 
with the
 
suppliers, the
 
third parties,
 
or any
financial institutions
 
concerning these
 
services, including
 
not providing
 
any form
 
of guarantee
 
and not
 
pledging assets
 
as security
 
to
the third
 
parties or
 
financial institutions.
 
All of
 
our accounts
 
payable remain
 
as obligations
 
to our
 
suppliers as
 
stated in
 
our supplier
agreements. As of February
 
25, 2024, $
1,348.9
 
million of our total accounts
 
payable were payable to
 
suppliers who utilize these third-
party services.
 
As of
 
May 28,
 
2023, $
1,430.1
 
million of
 
our total
 
accounts payable
 
were payable
 
to suppliers
 
who utilize
 
these third-
party services.
 
(7) Debt
The components of notes payable were as follows:
 
 
 
 
 
 
 
 
 
 
In Millions
Feb. 25, 2024
May 28, 2023
U.S. commercial paper
$
683.3
$
-
Financial institutions
3.4
31.7
Total
$
686.7
$
31.7
To ensure availability
 
of funds, we maintain bank credit lines and have commercial paper programs
 
available to us in the United States
and Europe.
 
14
The following table details the fee-paid committed and uncommitted credit
 
lines we had available as of February 25, 2024:
 
 
 
 
 
 
 
 
 
In Billions
Facility
 
Amount
Borrowed
Amount
Committed credit facility expiring April 2026
$
2.7
$
-
Uncommitted credit facilities
0.6
-
Total committed
 
and uncommitted credit facilities
$
3.3
$
-
The
 
credit
 
facilities
 
contain
 
covenants,
 
including
 
a
 
requirement
 
to
 
maintain
 
a
 
fixed
 
charge
 
coverage
 
ratio
 
of
 
at
 
least
2.5
 
times.
We
were in compliance with all credit facility covenants as of February 25, 2024.
Long-Term
 
Debt
 
The fair values
 
and carrying
 
amounts of long-term
 
debt, including
 
the current portion,
 
were $
11,112.5
 
million and $
11,827.3
 
million,
respectively,
 
as of
 
February
 
25,
 
2024.
 
The
 
fair value
 
of long-term
 
debt
 
was estimated
 
using
 
market quotations
 
and
 
discounted
 
cash
flows based
 
on our
 
current incremental
 
borrowing rates
 
for similar
 
types of
 
instruments. Long
 
-term debt
 
is a
 
Level 2
 
liability in
 
the
fair value hierarchy.
 
In
 
the
 
third
 
quarter of
 
fiscal
 
2024,
 
we
 
issued
 
$
500.0
 
million
 
of
4.7
 
percent
 
fixed-rate
 
notes due
January 30, 2027
. We
 
used
 
the
 
net
proceeds to repay $
500.0
 
million of
3.65
 
percent fixed-rate notes due
February 15, 2024
.
 
In the second
 
quarter of fiscal 2024,
 
we issued €
250.0
 
million of floating-rate
 
notes due
November 8, 2024
. We
 
used the net proceeds
to repay €
250.0
 
million of floating-rate notes due
November 10, 2023
.
 
In the
 
second quarter
 
of fiscal
 
2024, we
 
issued $
500.0
 
million of
5.5
 
percent fixed-rate
 
notes due
October 17, 2028
. We
 
used the
 
net
proceeds to repay $
400.0
 
million of floating-rate notes due
October 17, 2023
, and for general corporate purposes.
 
In the first
 
quarter of fiscal
 
2024, we issued
 
500.0
 
million of floating-rate
 
notes due
November 8, 2024
. We
 
used the net proceeds
 
to
repay €
500.0
 
million of floating-rate notes due
July 27, 2023
.
 
In the fourth quarter
 
of fiscal 2023, we
 
issued €
250.0
 
million of floating-rate notes
 
due
November 10, 2023
. We
 
used the net proceeds
to repay €
250.0
 
million of floating-rate notes due
May 16, 2023
.
In the
 
fourth quarter
 
of fiscal
 
2023, we
 
issued €
750.0
 
million of
3.907
 
percent fixed-rate
 
notes due
April 13, 2029
. We
 
used the
 
net
proceeds to repay €
500.0
 
million of
1.0
 
percent fixed-rate notes due
April 27, 2023
, and €
250.0
 
million of floating-rate notes due
May
16, 2023
.
In the fourth
 
quarter of fiscal
 
2023, we
 
issued $
1,000.0
 
million of
4.95
 
percent fixed-rate
 
notes due
March 29, 2033
. We
 
used the net
proceeds to repay our outstanding commercial paper and for general
 
corporate purposes.
In the second quarter of fiscal 2023, we issued $
500.0
 
million of
5.241
 
percent fixed-rate notes due
November 18, 2025
. We used the
net proceeds to repay a portion of our outstanding commercial paper and for general
 
corporate purposes.
In the second quarter of fiscal 2023, we issued €
250.0
 
million of floating-rate notes due
May 16, 2023
. We used the net proceeds
 
to
repay €
250.0
 
million of
0.0
 
percent fixed-rate notes due
November 11, 2022
.
In the second quarter of fiscal 2023, we repaid $
500.0
 
million of
2.6
 
percent fixed-rate notes due
October 12, 2022
, using proceeds
from the issuance of commercial paper.
Certain of
 
our long-term
 
debt agreements
 
contain restrictive
 
covenants.
As of February 25, 2024, we were in compliance with all of
these covenants.
 
(8) Noncontrolling Interests
The
 
third-party
 
holder
 
of
 
the
 
General
 
Mills
 
Cereals,
 
LLC
 
(GMC)
 
Class A
 
Interests
 
receives
 
quarterly
 
preferred
 
distributions
 
from
available net
 
income based
 
on the application
 
of a
 
floating preferred
 
return rate
 
to the
 
holder’s capital
 
account balance
 
established in
the most recent
 
mark-to-market valuation
 
(currently $
251.5
 
million). The
 
floating preferred return
 
rate on GMC’s
 
Class A Interests is
the
 
sum
 
of
 
the
three-month Term SOFR
 
plus
186
 
basis
 
points.
 
The
 
preferred
 
return
 
rate
 
is
 
adjusted
 
every
three years
 
through
 
a
negotiated agreement with the Class A Interest holder or through
 
a remarketing auction.
 
 
 
15
Our noncontrolling interests contain restrictive covenants. As of February 25, 2024, we were in compliance with all of these
covenants.
 
(9) Stockholders’ Equity
 
The following tables provide details of total comprehensive income:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Quarter Ended
Quarter Ended
Feb. 25, 2024
Feb. 26, 2023
General Mills
Noncontrolling
Interests
 
General Mills
Noncontrolling
Interests
In Millions
Pretax
Tax
Net
Net
Pretax
Tax
Net
Net
Net earnings, including earnings
 
 
attributable to noncontrolling interests
 
$
670.1
$
6.2
$
553.1
$
4.8
Other comprehensive income (loss):
Foreign currency translation
$
10.7
$
(8.1)
2.6
(0.2)
$
3.4
$
9.0
12.4
0.1
Other fair value changes:
Hedge derivatives
(8.8)
1.9
(6.9)
-
(6.3)
0.6
(5.7)
-
Reclassification to earnings:
Hedge derivatives (a)
(0.3)
0.2
(0.1)
-
23.1
(4.2)
18.9
-
Amortization of losses and
 
prior service costs (b)
11.5
(2.4)
9.1
-
18.1
(4.2)
13.9
-
Other comprehensive income (loss)
$
13.1
$
(8.4)
4.7
(0.2)
$
38.3
$
1.2
39.5
0.1
Total comprehensive income
$
674.8
$
6.0
$
592.6
$
4.9
(a)
 
(Gain) loss reclassified from AOCI into earnings is reported in interest, net for interest rate swaps and in cost of sales and SG&A expenses for foreign exchange contracts.
(b)
 
Loss reclassified from AOCI into earnings is reported in benefit plan non-service income.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Nine-Month Period Ended
Nine-Month Period Ended
Feb. 25, 2024
Feb. 26, 2023
General Mills
Noncontrolling
Interests
General Mills
Noncontrolling
Interests
In Millions
Pretax
Tax
Net
Net
Pretax
Tax
Net
Net
Net earnings, including earnings
 
 
attributable to noncontrolling interests
 
$
1,939.1
$
19.8
$
1,979.0
$
10.5
Other comprehensive (loss) income:
Foreign currency translation
$
(43.7)
$
5.5
(38.2)
0.2
$
(83.3)
$
(14.8)
(98.1)
(0.6)
Other fair value changes:
Hedge derivatives
(9.0)
1.7
(7.3)
-
(29.3)
6.1
(23.2)
-
Reclassification to earnings:
Foreign currency translation (a)
-
-
-
-
(7.4)
-
(7.4)
-
Hedge derivatives (b)
(5.0)
2.7
(2.3)
-
23.0
(4.5)
18.5
-
Amortization of losses and
 
prior service costs (c)
34.5
(7.1)
27.4
-
54.6
(12.4)
42.2
-
Other comprehensive (loss) income
$
(23.2)
$
2.8
(20.4)
0.2
$
(42.4)
$
(25.6)
(68.0)
(0.6)
Total comprehensive income
$
1,918.7
$
20.0
$
1,911.0
$
9.9
(a)
 
Gain reclassified from AOCI into earnings is reported in the divestitures gain, net.
 
(b)
 
(Gain) loss reclassified from AOCI into earnings is reported in interest, net for interest rate swaps and in cost of sales and SG&A expenses for foreign exchange contracts.
(c)
 
Loss reclassified from AOCI into earnings is reported in benefit plan non-service income.
Accumulated other comprehensive loss balances, net of tax effects,
 
were as follows:
 
 
 
 
 
 
 
 
 
 
In Millions
Feb. 25, 2024
May 28, 2023
Foreign currency translation adjustments
$
(746.8)
$
(708.6)
Unrealized (loss) gain from hedge derivatives
(3.7)
5.9
Pension, other postretirement, and postemployment benefits:
Net actuarial loss
(1,630.1)
(1,670.6)
Prior service credits
83.3
96.4
Accumulated other comprehensive loss
$
(2,297.3)
$
(2,276.9)
 
 
(10) Stock Plans
We
 
have various
 
stock-based compensation
 
programs under
 
which awards,
 
including stock
 
options, restricted
 
stock, restricted
 
stock
units, and performance
 
awards, may be granted
 
to employees and non-employee
 
directors. These programs
 
and related accounting
 
are
described in Note
 
12 to the
 
Consolidated Financial
 
Statements included
 
in our Annual
 
Report on Form
 
10-K for the
 
fiscal year ended
May 28, 2023.
 
 
 
 
 
16
Compensation expense related to stock-based payments recognized
 
in the Consolidated Statements of Earnings was as follows:
 
 
 
 
 
 
 
 
 
Quarter Ended
Nine-Month Period Ended
In Millions
Feb. 25, 2024
Feb. 26, 2023
Feb. 25, 2024
Feb. 26, 2023
Compensation expense related to stock-based payments
$
18.2
$
29.1
$
76.7
$
86.7
Windfall tax benefits from stock-based payments
 
in income tax expense in our Consolidated Statements of Earnings were as follows:
 
 
 
 
 
 
 
 
 
 
 
 
 
Quarter Ended
Nine-Month Period Ended
In Millions
Feb. 25, 2024
Feb. 26, 2023
Feb. 25, 2024
Feb. 26, 2023
Windfall tax benefits from stock-based payments
$
1.2
$
6.2
$
10.1
$
24.6
As
 
of
 
February
 
25,
 
2024,
 
unrecognized
 
compensation
 
expense
 
related
 
to
 
non-vested
 
stock
 
options,
 
restricted
 
stock
 
units,
 
and
performance share units was $
130.7
 
million. This expense will be recognized over
21
 
months, on average.
Net cash proceeds from the exercise of stock options
 
less shares used for withholding taxes and the intrinsic
 
value of options exercised
were as follows:
 
 
 
 
 
 
Nine-Month Period Ended
In Millions
Feb. 25, 2024
Feb. 26, 2023
Net cash proceeds
$
11.1
$
168.0
Intrinsic value of options exercised
$
3.4
$
81.8
We estimate the fair value of each stock option on the grant date using a Black-Scholes option-pricing model. Black-Scholes option-
pricing models require us to make predictive assumptions regarding future stock price volatility, employee exercise behavior, and
dividend yield. We estimate our future stock price volatility using the historical volatility over the expected term of the option,
excluding time periods of volatility we believe a marketplace participant would exclude in estimating our stock price volatility. We
also have considered, but did not use, implied volatility in our estimate, because trading activity in options on our stock, especially
those with tenors of greater than 6 months, is insufficient to provide a reliable measure of expected volatility. Our method of selecting
the other valuation assumptions is explained in Note 12 to the Consolidated Financial Statements included in our Annual Report on
Form 10-K for the fiscal year ended May 28, 2023.
The
 
estimated
 
fair
 
values
 
of
 
stock
 
options
 
granted
 
and
 
the
 
assumptions
 
used
 
for
 
the
 
Black-Scholes
 
option-pricing
 
model
 
were
 
as
follows:
 
 
 
 
 
 
 
 
 
 
 
Nine-Month Period Ended
Feb. 25, 2024
Feb. 26, 2023
Estimated fair values of stock options granted
 
$
17.47
$
14.16
Assumptions:
Risk-free interest rate
4.0
%
3.3
%
Expected term
8.5
years
8.5
years
Expected volatility
21.5
%
20.9
%
Dividend yield
2.8
%
3.1
%
The total grant date fair value of restricted stock unit awards that vested during
 
the period was as follows:
 
 
 
 
 
Nine-Month Period Ended
In Millions
Feb. 25, 2024
Feb. 26, 2023
Total grant date fair
 
value
$
91.1
$
105.4
 
 
 
 
17
 
(11) Earnings Per Share
Basic and diluted earnings per share (EPS) were calculated using the following:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Quarter Ended
Nine-Month Period Ended
In Millions, Except per Share Data
Feb. 25, 2024
Feb. 26, 2023
Feb. 25, 2024
Feb. 26, 2023
Net earnings attributable to General Mills
$
670.1
$
553.1
$
1,939.1
$
1,979.0
Average number
 
of common shares – basic EPS
569.5
592.5
578.6
596.2
Incremental share effect from: (a)
Stock options
1.3
3.7
1.8
3.6
Restricted stock units and performance share units
2.0
2.8
2.1
2.6
Average number
 
of common shares – diluted EPS
572.8
599.0
582.5
602.4
Earnings per share – basic
$
1.18
$
0.94
$
3.35
$
3.32
Earnings per share – diluted
$
1.17
$
0.92
$
3.33
$
3.28
(a)
 
Incremental
 
shares
 
from
 
stock
 
options,
 
restricted
 
stock
 
units,
 
and
 
performance
 
share
 
units
 
are
 
computed
 
by
 
the
 
treasury
 
stock
method.
Stock
 
options,
 
restricted
 
stock
 
units,
 
and
 
performance
 
share
 
units
 
excluded
 
from
 
our
 
computation
 
of
 
diluted
 
EPS
 
because
 
they
were not dilutive were as follows
:
 
 
 
 
 
 
 
 
Quarter Ended
Nine-Month Period Ended
In Millions
Feb. 25, 2024
Feb. 26, 2023
Feb. 25, 2024
Feb. 26, 2023
Anti-dilutive stock options, restricted stock units, and
 
performance share units
 
4.2
0.8
2.6
0.9
 
 
(12) Share Repurchases
Share repurchases were as follows:
 
 
 
 
 
 
 
 
 
 
Quarter Ended
Nine-Month Period Ended
In Millions
Feb. 25, 2024
Feb. 26, 2023
Feb. 25, 2024
Feb. 26, 2023
Shares of common stock
4.7
2.9
23.5
15.0
Aggregate purchase price
$
303.1
$
251.0
$
1,616.6
$
1,152.3
 
 
(13) Statements of Cash Flows
Our Consolidated Statements of Cash Flows include the following:
 
 
 
 
 
 
 
 
Nine-Month Period Ended
In Millions
Feb. 25, 2024
Feb. 26, 2023
Net cash interest payments
$
294.6
$
225.6
Net income tax payments
$
462.3
$
538.4
 
 
18
 
(14) Retirement and Postemployment Benefits
Components of net periodic benefit expense (income) are as follows:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Defined Benefit
Pension Plans
Other Postretirement
 
Benefit Plans
Postemployment
Benefit Plans
Quarter Ended
Quarter Ended
Quarter Ended
In Millions
Feb. 25,
2024
Feb. 26,
2023
Feb. 25,
2024
Feb. 26,
2023
Feb. 25,
2024
Feb. 26,
2023
Service cost
$
14.5
$
17.6
$
1.1
$
1.4
$
1.8
$
2.1
Interest cost
74.1
64.6
5.3
4.5
1.0
0.7
Expected return on plan assets
(104.5)
(105.0)
(8.6)
(7.7)
-
-
Amortization of losses (gains)
21.6
28.3
(5.1)
(4.9)
-
0.1
Amortization of prior service costs (credits)
0.4
0.4
(5.5)
(5.9)
0.1
0.1
Other adjustments
-
-
-
-
2.6
3.2
Net expense (income)
$
6.1
$
5.9
$
(12.8)
$
(12.6)
$
5.5
$
6.2
Defined Benefit
 
Pension Plans
Other Postretirement
 
Benefit Plans
Postemployment
Benefit Plans
Nine-Month
Period Ended
Nine-Month
Period Ended
Nine-Month
Period Ended
In Millions
Feb. 25,
2024
Feb. 26,
2023
Feb. 25,
2024
Feb. 26,
2023
Feb. 25,
2024
Feb. 26,
2023
Service cost
$
43.1
$
52.7
$
3.5
$
4.0
$
5.5
$
6.3
Interest cost
222.4
193.8
16.0
13.5
3.0
2.3
Expected return on plan assets
(313.4)
(315.0)
(26.0)
(23.3)
-
-
Amortization of losses (gains)
64.6
85.0
(15.3)
(14.6)
(0.1)
0.2
Amortization of prior service costs (credits)
1.3
1.1
(16.4)
(17.4)
0.4
0.3
Other adjustments
-
-
-
-
7.8
9.1
Curtailment gain
(3.4)
-
-
-
-
-
Net expense (income)
$
14.6
$
17.6
$
(38.2)
$
(37.8)
$
16.6
$
18.2
 
 
 
(15) Income Taxes
During the
 
second quarter
 
of fiscal
 
2024, we
 
received a
 
notice of
 
proposed adjustment
 
from the
 
Internal Revenue
 
Service associated
with a capital loss
 
from fiscal 2019.
 
We
 
believe that we
 
have meritorious defenses
 
against this assessment
 
and will vigorously
 
defend
our
 
position. We
 
do
 
not
 
expect
 
the
 
resolution
 
of
 
the
 
proposed
 
adjustment
 
to
 
have
 
a
 
material
 
impact
 
on
 
our
 
financial
 
position
 
or
liquidity.
During
 
the
 
first
 
quarter
 
of
 
fiscal
 
2023,
 
the
 
Inflation
 
Reduction
 
Act
 
(IRA)
 
was
 
signed
 
into
 
law.
 
The
 
IRA
 
introduces
 
a
 
Corporate
Alternative Minimum Tax
 
beginning in our fiscal 2024
 
and an excise tax on the
 
repurchase of corporate
 
stock starting after January
 
1,
2023.
 
The
 
IRA
 
does
 
not
 
have
 
a
 
material
 
impact
 
on
 
our
 
financial
 
results,
 
including
 
our
 
annual
 
estimated
 
effective
 
tax
 
rates
 
and
liquidity.
 
(16) Contingencies
During
 
fiscal
 
2020,
 
we
 
received
 
notice
 
from
 
the
 
tax
 
authorities of
 
the
 
State of
 
São
 
Paulo,
 
Brazil
 
regarding
 
our
 
compliance
 
with
 
its
state sales tax requirements.
 
As a result, we
 
have been assessed additional
 
state sales taxes, interest,
 
and penalties. We
 
believe that we
have
 
meritorious
 
defenses
 
against
 
this
 
claim
 
and
 
will
 
vigorously
 
defend
 
our
 
position.
 
As
 
of
 
February
 
25,
 
2024,
 
we
 
are
 
unable
 
to
estimate any possible loss and have not recorded a loss contingency for
 
this matter.
 
 
 
(17) Business Segment and Geographic Information
We
 
operate
 
in
 
the
 
packaged
 
foods
 
industry.
 
Our
 
operating
 
segments
 
are
 
as
 
follows:
 
North
 
America
 
Retail,
 
International,
 
Pet,
 
and
North America Foodservice.
 
19
 
 
 
 
 
 
 
 
Our North America Retail
 
operating segment reflects business
 
with a wide variety of
 
grocery stores, mass merchandisers, membership
stores,
 
natural
 
food
 
chains,
 
drug,
 
dollar
 
and
 
discount
 
chains,
 
convenience
 
stores,
 
and
 
e-commerce
 
grocery
 
providers.
 
Our
 
product
categories
 
in
 
this
 
business
 
segment
 
include
 
ready-to-eat
 
cereals,
 
refrigerated
 
yogurt,
 
soup,
 
meal
 
kits,
 
refrigerated
 
and
 
frozen
 
dough
products,
 
dessert
 
and
 
baking
 
mixes,
 
frozen
 
pizza
 
and
 
pizza
 
snacks,
 
snack
 
bars,
 
fruit
 
snacks,
 
savory
 
snacks,
 
and
 
a
 
wide
 
variety
 
of
organic products including ready-to-eat cereal, frozen
 
and shelf-stable vegetables, meal kits, fruit snacks, and snack bars.
Our
 
International
 
operating
 
segment
 
consists
 
of
 
retail
 
and
 
foodservice
 
businesses
 
outside
 
of
 
the
 
United
 
States
 
and
 
Canada.
 
Our
product categories include super-premium
 
ice cream and frozen desserts, meal kits, salty snacks,
 
snack bars, dessert and baking mixes,
shelf-stable
 
vegetables,
 
and
 
pet
 
food
 
products.
 
We
 
also
 
sell
 
super-premium
 
ice
 
cream
 
and
 
frozen
 
desserts
 
directly
 
to
 
consumers
through owned
 
retail shops. Our
 
International segment
 
also includes products
 
manufactured in
 
the United States
 
for export, mainly
 
to
Caribbean and Latin American markets, as well as products we
 
manufacture for sale to our international joint ventures. Revenues
 
from
export activities are reported in the region or country where the end customer
 
is located.
Our Pet operating segment includes
 
pet food products sold primarily in the
 
United States and Canada in national
 
pet superstore chains,
e-commerce retailers,
 
grocery stores,
 
regional pet
 
store chains,
 
mass merchandisers,
 
and veterinary
 
clinics and
 
hospitals. Our
 
product
categories include dog and cat food (dry
 
foods, wet foods, and treats) made with
 
whole meats, fruits, vegetables and other
 
high-quality
natural
 
ingredients.
 
Our
 
tailored
 
pet
 
product
 
offerings
 
address
 
specific
 
dietary,
 
lifestyle,
 
and
 
life-stage
 
needs
 
and
 
span
 
different
product types, diet types, breed sizes for dogs, lifestages, flavors, product
 
functions,
 
and textures and cuts for wet foods.
Our
 
North
 
America
 
Foodservice
 
segment
 
consists
 
of
 
foodservice
 
businesses
 
in
 
the
 
United
 
States
 
and
 
Canada.
 
Our
 
major
 
product
categories
 
in
 
our
 
North
 
America
 
Foodservice
 
operating
 
segment
 
are
 
ready-to-eat
 
cereals,
 
snacks,
 
refrigerated
 
yogurt,
 
frozen
 
meals,
unbaked and
 
fully baked
 
frozen dough products,
 
baking mixes,
 
and bakery
 
flour.
 
Many products we
 
sell are branded
 
to the consumer
and nearly
 
all are
 
branded to
 
our customers.
 
We
 
sell to
 
distributors and
 
operators in
 
many customer
 
channels including
 
foodservice,
vending, and supermarket bakeries.
Operating profit
 
for these
 
segments excludes
 
unallocated corporate
 
items, gain
 
or loss
 
on divestitures,
 
and restructuring,
 
impairment,
and other
 
exit costs.
 
Results from
 
certain businesses
 
managed by
 
our Gold
 
Medal Ventures
 
entity are
 
included within
 
corporate and
other net
 
sales and
 
unallocated corporate
 
items within
 
operating
 
profit. Unallocated
 
corporate items
 
also include
 
corporate overhead
expenses,
 
variances
 
to
 
planned
 
North
 
American
 
employee
 
benefits
 
and
 
incentives,
 
certain
 
charitable
 
contributions,
 
restructuring
initiative
 
project-related
 
costs,
 
gains
 
and
 
losses
 
on
 
corporate
 
investments,
 
and
 
other
 
items
 
that
 
are
 
not
 
part
 
of
 
our
 
measurement
 
of
segment operating performance.
 
These include gains and
 
losses arising from the
 
revaluation of certain grain
 
inventories and gains
 
and
losses
 
from
 
mark-to-market
 
valuation
 
of
 
certain
 
commodity
 
positions
 
until
 
passed
 
back
 
to
 
our
 
operating
 
segments.
 
These
 
items
affecting
 
operating
 
profit
 
are
 
centrally
 
managed
 
at
 
the
 
corporate
 
level
 
and
 
are
 
excluded
 
from
 
the
 
measure
 
of
 
segment
 
profitability
reviewed
 
by executive
 
management.
 
Under our
 
supply chain
 
organization,
 
our manufacturing,
 
warehouse,
 
and distribution
 
activities
are
 
substantially
 
integrated
 
across
 
our
 
operations
 
in
 
order
 
to
 
maximize
 
efficiency
 
and
 
productivity.
 
As
 
a
 
result,
 
fixed
 
assets
 
and
depreciation and amortization expenses are neither maintained nor available
 
by operating segment.
 
 
 
 
 
 
 
 
20
 
Our operating segment results were as follows:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Quarter Ended
Nine-Month Period Ended
In Millions
Feb. 25, 2024
Feb. 26, 2023
Feb. 25, 2024
Feb. 26, 2023
Net sales:
North America Retail
$
3,242.1
$
3,232.0
$
9,620.1
$
9,593.9
International
680.1
700.6
2,079.0
2,024.8
Pet
624.5
645.5
1,773.7
1,818.3
North America Foodservice
551.7
547.8
1,669.7
1,627.2
Total segment net
 
sales
$
5,098.4
$
5,125.9
$
15,142.5
$
15,064.2
Corporate and other
0.8
-
0.8
-
Total net sales
$
5,099.2
$
5,125.9
$
15,143.3
$
15,064.2
Operating profit:
North America Retail
$
752.2
$
786.9
$
2,410.3
$
2,401.8
International
18.2
42.4
102.8
95.0
Pet
128.3
102.6
342.0
312.3
North America Foodservice
81.7
82.4
236.3
217.5
Total segment operating
 
profit
$
980.4
$
1,014.3
$
3,091.4
$
3,026.6
Unallocated corporate items
63.9
296.4
308.3
841.5
Divestitures gain, net
-
(13.7)
-
(444.6)
Restructuring, impairment, and other exit costs
5.8
1.4
130.6
14.1
Operating profit
$
910.7
$
730.2
$
2,652.5
$
2,615.6
Net sales for our North America Retail operating units were as follows:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Quarter Ended
Nine-Month Period Ended
In Millions
Feb. 25, 2024
Feb. 26, 2023
Feb. 25, 2024
Feb. 26, 2023
U.S. Meals & Baking Solutions
$
1,168.5
$
1,185.3
$
3,453.7
$
3,456.2
U.S. Morning Foods
940.7
918.6
2,725.4
2,731.1
U.S. Snacks
869.2
883.5
2,660.0
2,663.6
Canada
263.7
244.6
781.0
743.0
Total
$
3,242.1
$
3,232.0
$
9,620.1
$
9,593.9
Net sales by class of similar products were as follows:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Quarter Ended
Nine-Month Period Ended
In Millions
Feb. 25, 2024
Feb. 26, 2023
Feb. 25, 2024
Feb. 26, 2023
Snacks
$
1,052.4
$
1,065.5
$
3,226.4
$
3,236.7
Cereal
843.4
801.9
2,438.2
2,427.5
Convenient meals
840.2
815.6
2,290.8
2,281.2
Dough
605.1
644.8
1,915.1
1,855.2
Pet
627.6
646.2
1,779.8
1,820.7
Baking mixes and ingredients
507.5
517.7
1,536.3
1,554.9
Yogurt
367.0
378.0
1,100.3
1,081.5
Super-premium ice cream
142.0
148.2
534.3
496.6
Other
114.0
108.0
322.1
309.9
Total
$
5,099.2
$
5,125.9
$
15,143.3
$
15,064.2
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
21
Item 2.
 
Management’s Discussion and Analysis
 
of Financial Condition and Results of Operations.
INTRODUCTION
This
 
Management’s
 
Discussion
 
and
 
Analysis
 
of
 
Financial
 
Condition
 
and
 
Results
 
of
 
Operations
 
(MD&A)
 
should
 
be
 
read
 
in
conjunction
 
with
 
the
 
MD&A
 
included
 
in
 
our
 
Annual
 
Report
 
on
 
Form
 
10-K
 
for
 
the
 
fiscal
 
year
 
ended
 
May
 
28,
 
2023,
 
for
 
important
background
 
regarding,
 
among other
 
things, our
 
key business
 
drivers.
 
Significant
 
trademarks and
 
service marks
 
used in
 
our business
are set forth in
italics
herein. Certain terms used throughout this report are defined in the
 
“Glossary” section below.
We
 
expect the largest
 
factors impacting our performance
 
in fiscal 2024
 
will be the economic
 
health of consumers, the
 
moderating rate
of
 
input
 
cost
 
inflation,
 
and
 
the
 
increasing
 
stability
 
of
 
the
 
supply
 
chain
 
environment.
 
We
 
anticipate
 
input
 
cost
 
inflation
 
of
approximately
 
4
 
percent
 
in
 
fiscal
 
2024
 
and
 
expect
 
to
 
generate
 
higher
 
levels
 
of
 
Holistic
 
Margin
 
Management
 
(HMM)
 
cost
 
savings
compared to fiscal 2023.
CONSOLIDATED
 
RESULTS
 
OF OPERATIONS
Third Quarter Results
In the third quarter of fiscal 2024,
 
net sales and organic net sales decreased
 
1 percent compared to the same period
 
last year. Operating
profit
 
increased
 
25
 
percent
 
to
 
$911
 
million,
 
primarily
 
driven
 
by
 
favorable
 
net
 
price
 
realization
 
and
 
mix,
 
a
 
decrease
 
in
 
certain
compensation
 
and
 
benefits
 
expenses,
 
a
 
favorable
 
change
 
in the
 
mark-to-market
 
valuation
 
of
 
certain
 
commodity
 
positions
 
and
 
grain
inventories,
 
and
 
net
 
recoveries
 
from
 
the
 
fiscal
 
2023
 
voluntary
 
recall
 
on
 
certain
 
international
Häagen-Dazs
ice
 
cream
 
products,
partially
 
offset
 
by
 
higher
 
input
 
costs
 
and
 
a
 
decrease
 
in
 
contributions
 
from
 
volume
 
growth.
 
Operating
 
profit
 
margin
 
of
 
17.9
 
percent
increased
 
370
 
basis
 
points.
 
Adjusted
 
operating
 
profit
 
of
 
$914
 
million
 
increased
 
14
 
percent
 
on
 
a
 
constant-currency
 
basis,
 
primarily
driven
 
by
 
favorable
 
net
 
price
 
realization
 
and
 
mix
 
and
 
a
 
decrease
 
in
 
certain
 
compensation
 
and
 
benefits
 
expenses,
 
partially
 
offset
 
by
higher input costs and
 
a decrease in contributions
 
from volume growth.
 
Adjusted operating profit margin
 
increased 220 basis points to
17.9 percent. Diluted earnings per
 
share of $1.17 increased 27 percent
 
in the third quarter of fiscal
 
2024. Adjusted diluted earnings per
share of
 
$1.17 increased
 
22 percent
 
on a
 
constant-currency
 
basis compared
 
to the
 
third quarter
 
of fiscal
 
2023.
 
See the
 
“Non-GAAP
Measures” section below for a description of our use of measures not defined
 
by GAAP.
A summary of our consolidated financial results for the third quarter of
 
fiscal 2024 follows:
 
Quarter Ended Feb. 25, 2024
In millions,
except per share
Quarter Ended
Feb. 25, 2024 vs.
Feb. 26, 2023
Percent
of Net
Sales
Constant-
Currency
Growth (a)
Net sales
 
$
5,099.2
(1)
%
Operating profit
910.7
25
%
17.9
%
Net earnings attributable to General Mills
670.1
21
%
Diluted earnings per share
$
1.17
27
%
Organic net sales growth rate (a)
(1)
%
Adjusted operating profit (a)
914.5
13
%
17.9
%
14
%
Adjusted diluted earnings per share (a)
$
1.17
21
%
22
%
(a)
 
See the “Non-GAAP Measures” section below for our use of measures not defined by
 
GAAP.
Consolidated
net sales
 
were as follows:
 
Quarter Ended
Feb. 25, 2024
Feb. 25, 2024 vs.
 
Feb. 26, 2023
Feb. 26, 2023
Net sales (in millions)
$
5,099.2
(1)
%
$
5,125.9
Contributions from volume growth (a)
(2)
pts
Net price realization and mix
2
pts
Foreign currency exchange
Flat
Note: Table may
 
not foot due to rounding.
(a)
 
Measured in tons based on the stated weight of our product shipments.
Net sales
 
in the
 
third quarter
 
of fiscal
 
2024 decreased
 
1 percent
 
compared to
 
the same
 
period in
 
fiscal 2023,
 
driven by
 
a decrease
 
in
contributions from volume growth, partially offset by
 
favorable net price realization and mix.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
22
Components of organic net sales growth are shown in the following
 
table:
 
 
Quarter Ended Feb. 25, 2024 vs.
Quarter Ended Feb. 26, 2023
Contributions from organic volume growth (a)
(2)
pts
Organic net price realization and mix
2
pts
Organic net sales growth
(1)
pt
Foreign currency exchange
Flat
Acquisition and divestitures
Flat
Net sales growth
(1)
pt
Note: Table may
 
not foot due to rounding.
(a)
 
Measured in tons based on the stated weight of our product shipments.
Organic
 
net
 
sales
 
decreased
 
1
 
percent
 
in
 
the
 
third
 
quarter
 
of
 
fiscal
 
2024
 
compared
 
to
 
the
 
same
 
period
 
in
 
fiscal
 
2023,
 
driven
 
by
 
a
decrease in contributions from organic volume growth,
 
partially offset by favorable organic net price realization
 
and mix.
Cost of
 
sales
decreased $69 million
 
to $3,392
 
million in
 
the third
 
quarter of
 
fiscal 2024
 
compared to
 
the same
 
period in
 
fiscal 2023.
The
 
decrease
 
was primarily
 
driven
 
by
 
a $74
 
million
 
decline
 
attributable
 
to
 
lower
 
volume,
 
partially
 
offset
 
by
 
a
 
$46
 
million
 
increase
attributable to product
 
rate and mix. We
 
recorded a $26 million
 
net increase in cost
 
of sales related to
 
the mark-to-market valuation
 
of
certain
 
commodity
 
positions
 
and
 
grain
 
inventories
 
in
 
the third
 
quarter of
 
fiscal
 
2024,
 
compared
 
to
 
a $67
 
million
 
net increase
 
in
 
the
third quarter of fiscal 2023.
 
Divestitures gain, net
 
totaled $14 million in the third quarter of fiscal 2023.
Selling, general,
 
and administrative
 
(SG&A)
 
expenses
decreased
 
$156 million
 
to $791 million
 
in the
 
third quarter
 
of fiscal
 
2024,
compared
 
to
 
the
 
same
 
period
 
in
 
fiscal
 
2023,
 
primarily
 
driven
 
by
 
a
 
decrease
 
in
 
certain
 
compensation
 
and
 
benefits
 
expenses,
 
net
recoveries from
 
the fiscal 2023
 
voluntary recall
 
of certain international
Häagen-Dazs
ice cream products
 
,
 
and favorable net
 
corporate
investment activity.
 
SG&A expenses
 
as a
 
percent of
 
net sales in
 
the third
 
quarter of
 
fiscal 2024
 
decreased 300
 
basis points
 
compared
to the third quarter of fiscal 2023.
Restructuring, impairment,
 
and other exit
 
costs
totaled $6 million
 
in the third quarter
 
of fiscal 2024,
 
compared to $1 million
 
in the
same
 
period
 
last
 
year.
 
In
 
fiscal
 
2024,
 
we
 
approved
 
restructuring
 
actions
 
to
 
enhance
 
the
 
go-to-market
 
commercial
 
strategy
 
and
associated
 
organizational
 
structure
 
of
 
our
 
Pet segment,
 
and
 
as a
 
result,
 
we
 
recorded
 
$8 million
 
of
 
restructuring
 
charges
 
in
 
the
 
third
quarter of
 
fiscal 2024.
 
In addition,
 
we recorded
 
a $3
 
million net
 
recovery of
 
restructuring charges
 
in the
 
third quarter
 
of fiscal
 
2024
related
 
to
 
actions
 
previously
 
announced
 
(please
 
refer
 
to
 
Note
 
3
 
to
 
the
 
Consolidated
 
Financial
 
Statements
 
in
 
Part
 
I,
 
Item
 
1
 
of
 
this
report).
Benefit plan
 
non-service income
totaled $19 million
 
in the
 
third quarter
 
of fiscal
 
2024,
 
compared to
 
$22 million in
 
the same
 
period
last year, primarily reflecting higher
 
interest costs, partially offset by lower amortization of losses.
 
Interest,
 
net
for the
 
third quarter
 
of fiscal
 
2024 totaled
 
$122 million, up
 
$23 million from
 
the third
 
quarter of
 
fiscal 2023,
 
primarily
driven by higher interest rates and higher average long-term debt levels.
The
effective
 
tax
 
rate
 
for
 
the third
 
quarter
 
of fiscal
 
2024
 
was 18.5
 
percent
 
compared
 
to 16.6
 
percent
 
for
 
the
 
third
 
quarter
 
of fiscal
2023.
 
The
 
1.9
 
percentage
 
point
 
increase
 
was
 
primarily
 
due
 
to
 
certain
 
favorable
 
tax
 
components
 
related
 
to
 
the
 
divestitures
 
in
 
fiscal
2023, partially
 
offset by
 
certain nonrecurring
 
discrete tax
 
benefits in
 
the third
 
quarter of
 
fiscal 2024.
 
Our effective
 
tax rate
 
excluding
certain items affecting
 
comparability was 18.4
 
percent in the third
 
quarter of fiscal 2024,
 
compared to 21.6
 
percent in the same
 
period
last
 
year
 
(see
 
the
 
“Non-GAAP
 
Measures”
 
section
 
below
 
for
 
a
 
description
 
of
 
our
 
use
 
of
 
measures
 
not
 
defined
 
by
 
GAAP).
 
The
 
3.2
percentage point decrease was primarily due to certain nonrecurring discrete
 
tax benefits in the third quarter of fiscal 2024.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
23
After-tax earnings
 
from
 
joint ventures
 
for the
 
third quarter
 
of fiscal
 
2024
increased to
 
$18 million compared
 
to $13 million
 
in the
same
 
period
 
in
 
fiscal
 
2023,
 
primarily
 
due
 
to
 
higher
 
net
 
sales
 
driven
 
by
 
favorable
 
net
 
price
 
realization
 
and
 
mix
 
at
 
Cereal
 
Partners
Worldwide
 
(CPW) and
 
discrete tax
 
items at CPW,
 
partially offset
 
by higher
 
input costs
 
at CPW and
 
Häagen-Dazs Japan,
 
Inc. (HDJ).
On
 
a
 
constant-currency
 
basis,
 
after-tax
 
earnings
 
from
 
joint
 
ventures
 
increased
 
64
 
percent
 
(see
 
the
 
“Non-GAAP
 
Measures”
 
section
below for a description of our use of measures not defined by GAAP).
 
The components of our joint ventures’ net sales growth are shown in the following
 
table:
 
Quarter Ended Feb. 25, 2024 vs.
Quarter Ended Feb. 26, 2023
CPW
HDJ
Total
Contributions from volume growth (a)
(4)
pts
(9)
pts
Net price realization and mix
16
pts
7
pts
Net sales growth in constant currency
11
pts
(2)
pts
9
pts
Foreign currency exchange
(4)
pts
(10)
pts
(5)
pts
Net sales growth
7
pts
(12)
pts
3
pts
Note: Table may
 
not foot due to rounding.
(a)
 
Measured in tons based on the stated weight of our product shipments.
Average
 
diluted
 
shares
 
outstanding
decreased
 
by
 
26
 
million
 
in
 
the
 
third
 
quarter
 
of
 
fiscal
 
2024
 
from
 
the
 
same
 
period
 
a
 
year
 
ago
primarily due to share repurchases, partially offset by option
 
exercises.
Nine-Month Results
In the
 
nine-month period
 
ended February
 
25, 2024,
 
net sales
 
and organic
 
net sales
 
increased 1
 
percent compared
 
to the
 
same period
last
 
year.
 
Operating
 
profit
 
increased
 
1
 
percent
 
to
 
$2,652
 
million,
 
primarily
 
driven
 
by
 
favorable
 
net
 
price
 
realization
 
and
 
mix,
 
a
favorable
 
change
 
in
 
the
 
mark-to-market
 
valuation
 
of
 
certain
 
commodity
 
positions
 
and
 
grain
 
inventories,
 
a
 
decrease
 
in
 
certain
compensation
 
and
 
benefits
 
expense,
 
favorable
 
net
 
corporate
 
investment
 
activity,
 
and
 
net
 
recoveries
 
from
 
the
 
fiscal
 
2023
 
voluntary
recall on certain
 
international
Häagen-Dazs
ice cream products
 
compared to
 
recall-related charges
 
in fiscal 2023,
 
partially offset
 
by a
net
 
gain
 
on
 
divestitures
 
in
 
fiscal
 
2023,
 
higher
 
input
 
costs,
 
a
 
decrease
 
in
 
contributions
 
from
 
volume
 
growth,
 
higher
 
impairment
 
and
restructuring
 
charges,
 
and higher
 
media and
 
advertising expenses.
 
Operating
 
profit margin
 
of 17.5
 
percent increased
 
10 basis
 
points
compared to
 
the same
 
period last
 
year.
 
Adjusted operating
 
profit of
 
$2,803 million
 
increased 9
 
percent on
 
a constant-currency
 
basis,
primarily
 
driven
 
by
 
favorable
 
net
 
price
 
realization
 
and
 
mix
 
and
 
a
 
decrease
 
in
 
certain
 
compensation
 
and
 
benefits
 
expenses,
 
partially
offset by higher input
 
costs and a decrease in
 
contributions from volume growth.
 
Adjusted operating profit margin
 
increased 150 basis
points to 18.5
 
percent. Diluted earnings
 
per share of $3.33
 
increased 2 percent in
 
the nine-month period
 
ended February 25, 2024,
 
and
adjusted diluted
 
earnings per
 
share of
 
$3.51 increased
 
11 percent
 
on a
 
constant-currency basis
 
compared to
 
the same
 
period last
 
year
(see the “Non-GAAP Measures” section below for a description of our use
 
of measures not defined by GAAP).
A summary of our consolidated financial results for the nine-month period
 
ended February 25, 2024, follows:
Nine-Month Period Ended Feb. 25, 2024
In millions,
except per share
Nine-Month
Period Ended
Feb. 25, 2024 vs.
Feb. 26, 2023
Percent of Net
Sales
Constant-
Currency
 
Growth (a)
Net sales
 
$
15,143.3
1
%
Operating profit
2,652.5
1
%
17.5
%
Net earnings attributable to General Mills
1,939.1
(2)
%
Diluted earnings per share
$
3.33
2
%
Organic net sales growth rate (a)
1
%
Adjusted operating profit (a)
2,802.9
9
%
18.5
%
9
%
Adjusted diluted earnings per share (a)
$
3.51
10
%
11
%
(a)
 
See the “Non-GAAP Measures” section below for our use of measures not defined by GAAP.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
24
Consolidated
net sales
 
were as follows:
Nine-Month Period Ended
Feb. 25, 2024
Feb. 25, 2024 vs.
Feb. 26, 2023
Feb. 26, 2023
Net sales (in millions)
$
15,143.3
1
%
$
15,064.2
Contributions from volume growth (a)
(3)
pts
Net price realization and mix
3
pts
Foreign currency exchange
Flat
Note: Table may not foot due to rounding.
(a)
 
Measured in tons based on the stated weight of our product shipments.
The 1
 
percent increase
 
in net
 
sales for
 
the nine-month
 
period ended
 
February 25,
 
2024, was
 
driven
 
by favorable
 
net price
 
realization
and mix, partially offset by a decrease in contributions
 
from volume growth.
Components of organic net sales growth are shown in the following
 
table:
Nine-Month Period Ended Feb. 25, 2024 vs.
Nine-Month Period Ended Feb. 26, 2023
Contributions from organic volume growth (a)
(3)
pts
Organic net price realization and mix
4
pts
Organic net sales growth
1
pt
Foreign currency exchange
Flat
Acquisition and divestitures
Flat
Net sales growth
1
pt
Note: Table may not foot due to rounding.
(a)
 
Measured in tons based on the stated weight of our product shipments.
Organic
 
net
 
sales
 
increased
 
1
 
percent
 
in
 
the
 
nine-month
 
period
 
ended
 
February
 
25,
 
2024,
 
driven
 
by
 
favorable
 
organic
 
net
 
price
realization and mix, partially offset by a decrease in
 
contributions from organic volume growth.
 
Cost
 
of
 
sales
 
decreased
 
$347 million
 
to
 
$9,900
 
million
 
in
 
the
 
nine-month
 
period
 
ended
 
February
 
25,
 
2024,
 
compared
 
to
 
the
 
same
period
 
in
 
fiscal
 
2023.
 
The
 
decrease
 
was
 
primarily
 
driven
 
by
 
a
 
$281
 
million
 
decline
 
due
 
to
 
lower
 
volume,
 
partially
 
offset
 
by
 
a
$202 million increase
 
attributable to
 
product rate
 
and mix. We
 
recorded a
 
$6 million net
 
increase in
 
cost of
 
sales related
 
to the
 
mark-
to-market
 
valuation
 
of
 
certain
 
commodity
 
positions
 
and
 
grain
 
inventories
 
in
 
the
 
nine-month
 
period
 
ended
 
February
 
25,
 
2024,
compared to a
 
$266 million net increase
 
in the nine-month
 
period ended February
 
26, 2023. In
 
the nine-month period
 
ended February
26, 2023,
 
we recorded
 
a $25 million
 
charge related
 
to a voluntary
 
recall on
 
certain international
Häagen-Dazs
 
ice cream
 
products.
 
In
addition,
 
we
 
recorded
 
$17
 
million
 
of
 
restructuring
 
charges
 
and
 
$2
 
million
 
of
 
restructuring
 
initiative
 
project-related
 
costs in
 
cost
 
of
sales in the
 
nine-month period
 
ended February
 
25, 2024, compared
 
to $2 million
 
of restructuring charges
 
in the same
 
period last year
(please refer to Note 3 to the Consolidated Financial Statements in Part I, Item 1 of
 
this report).
 
SG&A expenses
decreased $171
 
million to
 
$2,461 million in the
 
nine-month period
 
ended February
 
25, 2024, compared
 
to the same
period
 
in
 
fiscal
 
2023,
 
primarily
 
driven
 
by
 
a
 
decrease
 
in
 
certain
 
compensation
 
and
 
benefits
 
expenses,
 
favorable
 
net
 
corporate
investment activity,
 
and net recoveries
 
from the fiscal
 
2023 voluntary
 
recall on
 
certain international
Häagen-Dazs
ice cream products
in fiscal 2024, partially offset
 
by higher media and advertising
 
expenses. SG&A expenses as a percent
 
of net sales decreased 130 basis
points in the nine-month period ended February 25, 2024, compared to the same
 
period of fiscal 2023.
 
Divestitures
 
gain,
 
net
 
totaled
 
$445
 
million
 
in
 
the
 
nine-month
 
period
 
ended
 
February
 
26,
 
2023,
 
primarily
 
related
 
to
 
the sale
 
of
 
our
Helper main meals
 
and Suddenly Salad
 
side dishes business (please
 
refer to Note 2
 
to the Consolidated Financial
 
Statements in Part
 
I,
Item 1 of this report).
 
Restructuring, impairment,
 
and other exit
 
costs
 
totaled $131 million in
 
the nine-month period
 
ended February 25,
 
2024, compared
to $14 million in the same period
 
last year. In
 
fiscal 2024, we recorded a $117
 
million non-cash goodwill impairment
 
charge related to
our
 
Latin
 
America
 
reporting
 
unit.
 
In
 
fiscal
 
2024,
 
we
 
approved
 
restructuring
 
actions
 
to
 
enhance
 
the
 
go-to-market
 
and
 
associated
organization
 
structure
 
of
 
our
 
Pet
 
segment,
 
and
 
as
 
a
 
result,
 
we
 
recorded
 
$13
 
million
 
of
 
charges
 
in
 
the
 
nine-month
 
period
 
ended
February
 
25,
 
2024.
 
In
 
addition,
 
we
 
also
 
recorded
 
$1
 
million
 
of
 
charges
 
related
 
to
 
actions
 
previously
 
announced
 
in
 
the
 
nine-month
period ended February 25, 2024 (please refer to Note 3 to the Consolidated
 
Financial Statements in Part I, Item 1 of this report).
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
25
Benefit plan non-service
 
income
 
totaled $56 million
 
in the nine-month
 
period ended February
 
25, 2024, compared
 
to $65 million
 
in
the same period last year, primarily reflecting
 
higher interest costs, partially offset by lower amortization of
 
losses.
Interest, net
 
for the nine-month
 
period ended February
 
25, 2024,
 
increased $79 million
 
to $356 million
 
compared to the
 
same period
of fiscal 2023, primarily driven by higher interest rates and higher
 
average long-term debt levels.
The
effective
 
tax rate
 
for
 
the nine-month
 
period ended
 
February
 
25,
 
2024, was
 
19.5
 
percent compared
 
to 19.6
 
percent in
 
the same
period
 
last
 
year.
 
The
 
0.1
 
percentage
 
point
 
decrease
 
was
 
primarily
 
due
 
to
 
certain
 
nonrecurring
 
discrete
 
tax
 
benefits
 
in
 
fiscal
 
2024,
partially offset
 
by certain
 
favorable tax
 
components related
 
to the
 
divestitures in
 
fiscal 2023.
 
Our effective
 
tax rate
 
excluding certain
items affecting
 
comparability
 
was 20.1
 
percent
 
in the
 
nine-month
 
period ended
 
February 25,
 
2024,
 
compared to
 
20.8 percent
 
in the
same period
 
last year (see
 
the “Non-GAAP Measures”
 
section below
 
for a description
 
of our use
 
of measures not
 
defined by GAAP).
The 0.7 percentage point decrease is primarily due to certain nonrecurring discrete
 
tax benefits in fiscal 2024.
After-tax
 
earnings from
 
joint ventures
 
increased
 
to $66 million
 
for the
 
nine-month
 
period ended
 
February 25,
 
2024, compared
 
to
$58 million
 
in the
 
same period
 
in fiscal
 
2023,
 
primarily
 
due to
 
higher
 
net sales
 
driven by
 
favorable
 
net price
 
realization and
 
mix at
CPW,
 
partially
 
offset
 
by
 
higher
 
input
 
costs
 
at
 
CPW
 
and
 
HDJ.
 
On
 
a
 
constant-currency
 
basis,
 
after-tax
 
earnings
 
from
 
joint
 
ventures
increased 25
 
percent (see
 
the “Non-GAAP
 
Measures” section
 
below for
 
a description
 
of our
 
use of
 
measures not
 
defined by
 
GAAP).
The components of our joint ventures’ net sales growth are shown in the following
 
table:
Nine-Month Period Ended Feb. 25, 2024 vs.
Nine-Month Period Ended Feb. 26, 2023
CPW
HDJ
Total
Contributions from volume growth (a)
(7)
pts
(5)
pts
Net price realization and mix
17
pts
8
pts
Net sales growth in constant currency
10
pts
3
pts
9
pts
Foreign currency exchange
(1)
pt
(6)
pts
(2)
pts
Net sales growth
9
pts
(4)
pts
6
pts
Note: Table may not foot due to rounding.
(a)
 
Measured in tons based on the stated weight of our product shipments.
Average
 
diluted
 
shares
 
outstanding
 
decreased
 
by
 
20 million
 
in
 
the
 
nine-month
 
period
 
ended
 
February
 
25,
 
2024,
 
from
 
the
 
same
period a year ago primarily due to share repurchases,
 
partially offset by option exercises.
SEGMENT OPERATING
 
RESULTS
Our businesses are
 
organized into
 
four operating segments:
 
North America Retail,
 
International,
 
Pet, and North
 
America Foodservice.
Please
 
refer
 
to
 
Note
 
17
 
of
 
the
 
Consolidated
 
Financial
 
Statements
 
in
 
Part
 
I,
 
Item
 
1
 
of
 
this
 
report
 
for
 
a
 
description
 
of
 
our
 
operating
segments.
North America Retail Segment Results
North America Retail net sales were as follows:
 
Quarter Ended
Nine-Month Period Ended
Feb. 25,
2024
Feb. 25, 2024 vs
Feb. 26, 2023
Feb. 26,
2023
Feb. 25,
2024
Feb. 25, 2024 vs
Feb. 26, 2023
Feb. 26,
2023
Net sales (in millions)
$
3,242.1
Flat
$
3,232.0
$
9,620.1
Flat
$
9,593.9
Contributions from volume growth (a)
(2)
pts
(4)
pts
Net price realization and mix
3
pts
5
pts
Foreign currency exchange
Flat
Flat
Note: Table may
 
not foot due to rounding.
(a)
 
Measured in tons based on the stated weight of our product shipments.
North America Retail net sales
 
in the third quarter of
 
fiscal 2024 and nine-month period ended
 
February 25, 2024, essentially matched
the same periods
 
in fiscal 2023.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
26
The components of North America Retail organic net
 
sales growth are shown in the following table:
 
Quarter Ended
Nine-Month Period Ended
Feb. 25, 2024
Feb. 25, 2024
Contributions from organic volume growth (a)
(2)
pts
(4)
pts
Organic net price realization and mix
3
pts
5
pts
Organic net sales growth
Flat
1
pt
Foreign currency exchange
Flat
Flat
Divestiture (b)
Flat
Flat
Net sales growth
Flat
Flat
Note: Table may
 
not foot due to rounding.
(a) Measured in tons based on the stated weight of our product shipments.
(b) Divestiture of our Helper main meals and Suddenly Salad side dishes businesses in
 
fiscal 2023. Please see Note 2 to the
 
Consolidated Financial Statements in Part I, Item 1 of this report.
North America Retail organic net sales in the third quarter
 
of fiscal 2024 essentially matched the same period in fiscal 2023.
North America
 
Retail organic
 
net sales increased
 
1 percent
 
in the nine
 
-month period
 
ended February
 
25, 2024,
 
compared to the
 
same
period
 
in fiscal
 
2023,
 
driven by
 
favorable
 
organic
 
net price
 
realization
 
and
 
mix, partially
 
offset
 
by a
 
decrease in
 
contributions
 
from
organic volume growth.
North America Retail net sales percentage change by operating unit are shown
 
in the following table:
 
Quarter Ended
Nine-Month Period Ended
Feb. 25, 2024
Feb. 25, 2024
Canada (a)
8
%
5
%
U.S. Meals & Baking Solutions
(1)
%
Flat
U.S. Snacks
(2)
%
Flat
U.S. Morning Foods
2
%
Flat
Total
Flat
Flat
(a)
 
On a
 
constant-currency
 
basis, Canada
 
net sales
 
increased 8
 
percent in
 
the third
 
quarter of
 
fiscal 2024
 
and increased
 
7 percent
 
in
the nine
 
-month period
 
ended February
 
25, 2024,
 
compared to
 
the same
 
periods in
 
fiscal 2023.
 
See the
 
“Non-GAAP Measures
 
section below for our use of this measure not defined by GAAP.
Segment operating profit decreased
 
4 percent to $752 million
 
in the third quarter of
 
fiscal 2024,
 
compared to $787 million in the
 
same
period in
 
fiscal 2023,
 
primarily driven
 
by higher
 
input costs
 
and a
 
decrease in
 
contributions from
 
volume growth,
 
partially offset
 
by
favorable net price
 
realization and mix.
 
Segment operating profit
 
decreased 4 percent
 
on a constant-currency
 
basis in the
 
third quarter
of fiscal 2024,
 
compared to the
 
same period in
 
fiscal 2023 (see
 
the “Non-GAAP
 
Measures” section below
 
for our use
 
of this measure
not defined by GAAP).
Segment operating profit
 
of $2,410 million in the
 
nine-month period ended
 
February 25, 2024,
 
essentially matched the same
 
period in
fiscal
 
2023
 
as
 
favorable
 
net
 
price
 
realization
 
and
 
mix
 
was
 
partially
 
offset
 
by
 
higher
 
input
 
costs,
 
a
 
decrease
 
in
 
contributions
 
from
volume growth,
 
and an
 
increase in
 
SG&A expenses.
 
Segment operating
 
profit on
 
a constant-currency
 
basis in
 
the nine-month
 
period
ended February
 
25, 2024,
 
essentially matched
 
the same
 
period in
 
fiscal 2023
 
(see the
 
“Non-GAAP Measures”
 
section below
 
for our
use of this measure not defined by GAAP).
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
27
International Segment Results
International net sales were as follows:
 
Quarter Ended
Nine-Month Period Ended
Feb. 25,
2024
Feb. 25, 2024 vs
Feb. 26, 2023
Feb. 26,
2023
Feb. 25,
2024
Feb. 25, 2024 vs
Feb. 26, 2023
Feb. 26,
2023
Net sales (in millions)
$
680.1
(3)
%
$
700.6
$
2,079.0
3
%
$
2,024.8
Contributions from volume growth (a)
(4)
pts
(4)
pts
Net price realization and mix
Flat
5
pts
Foreign currency exchange
Flat
1
pt
Note: Table may
 
not foot due to rounding.
(a)
 
Measured in tons based on the stated weight of our product shipments.
International net
 
sales decreased 3
 
percent in the
 
third quarter of
 
fiscal 2024, compared
 
to the same
 
period in
 
fiscal 2023, driven
 
by a
decrease in contributions from volume growth.
International
 
net sales
 
increased 3
 
percent in
 
the nine-month
 
period ended
 
February 25,
 
2024, compared
 
to the
 
same period
 
in fiscal
2023 that included the impact of
 
the voluntary recall on certain international
Häagen-Dazs
 
ice cream products, driven by favorable
 
net
price realization and mix and favorable foreign currency exchange, partially
 
offset by a decrease in contributions from volume growth.
The components of International organic net sales growth
 
are shown in the following table:
 
Quarter Ended
Nine-Month Period Ended
Feb. 25, 2024
Feb. 25, 2024
Contributions from organic volume growth (a)
(4)
pts
(4)
pts
Organic net price realization and mix
Flat
5
pts
Organic net sales growth
(3)
pts
2
pts
Foreign currency exchange
Flat
1
pt
Net sales growth
(3)
pts
3
pts
Note: Table may
 
not foot due to rounding.
(a) Measured in tons based on the stated weight of our product shipments.
International
 
organic
 
net
 
sales
 
decreased
 
3
 
percent
 
in
 
the
 
third
 
quarter
 
of
 
fiscal
 
2024,
 
compared
 
to
 
the
 
same
 
period
 
in
 
fiscal
 
2023,
driven by a decrease in contributions from organic volume
 
growth.
International organic
 
net sales increased
 
2 percent in
 
the nine-month period
 
ended February 25,
 
2024, compared to
 
the same period
 
in
fiscal
 
2023
 
that
 
included
 
the
 
impact
 
of
 
the
 
voluntary
 
recall
 
on
 
certain
 
international
Häagen-Dazs
 
ice
 
cream
 
products,
 
driven
 
by
favorable organic net price realization and mix, partially offset
 
by a decrease in contributions from organic volume growth.
Segment operating
 
profit decreased 57
 
percent to
 
$18 million in the
 
third quarter
 
of fiscal 2024,
 
compared to $42
 
million in the
 
same
period in
 
fiscal 2023,
 
primarily driven
 
by higher
 
input costs
 
and a
 
decrease in
 
contributions from
 
volume growth.
 
Segment operating
profit decreased 53 percent
 
on a constant-currency basis
 
in the third quarter of
 
fiscal 2024,
 
compared to the same period
 
in fiscal 2023
(see the “Non-GAAP Measures” section below for our use of this measure
 
not defined by GAAP).
Segment
 
operating
 
profit
 
increased
 
8
 
percent
 
to
 
$103
 
million
 
in
 
the
 
nine-month
 
period
 
ended
 
February
 
25,
 
2024,
 
compared
 
to
$95 million
 
in
 
the
 
same
 
period
 
in
 
fiscal
 
2023,
 
primarily
 
driven
 
by
 
favorable
 
net
 
price
 
realization
 
and
 
mix,
 
the
 
voluntary
 
recall
 
on
certain
 
international
Häagen-Dazs
 
ice
 
cream
 
products
 
in
 
fiscal
 
2023,
 
and
 
a
 
decrease
 
in
 
SG&A
 
expenses,
 
partially
 
offset
 
by
 
higher
input costs and a decrease
 
in contributions from volume growth.
 
Segment operating profit increased
 
14 percent on a constant-currency
basis in the nine
 
-month period ended
 
February 25, 2024,
 
compared to the
 
same period in fiscal
 
2023 (see the
 
“Non-GAAP Measures”
section below for our use of this measure not defined by GAAP).
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
28
Pet Segment Results
Pet net sales were as follows:
 
Quarter Ended
Nine-Month Period Ended
Feb. 25,
2024
Feb. 25, 2024 vs
Feb. 26, 2023
Feb. 26,
2023
Feb. 25,
2024
Feb. 25, 2024 vs
Feb. 26, 2023
Feb. 26,
2023
Net sales (in millions)
$
624.5
(3)
%
$
645.5
$
1,773.7
(2)
%
$
1,818.3
Contributions from volume growth (a)
(5)
pts
(7)
pts
Net price realization and mix
2
pts
5
pts
Foreign currency exchange
Flat
Flat
Note: Table may
 
not foot due to rounding.
(a)
 
Measured in tons based on the stated weight of our product shipments.
Pet net
 
sales decreased
 
3 percent
 
in the
 
third quarter of
 
fiscal 2024,
 
compared to
 
the same period
 
in fiscal 2023,
 
driven by
 
a decrease
in contributions from volume growth, partially offset by
 
favorable net price realization and mix.
Pet
 
net
 
sales
 
decreased
 
2
 
percent
 
in
 
the
 
nine-month
 
period
 
ended
 
February
 
25,
 
2024,
 
compared
 
to
 
the
 
same
 
period
 
in
 
fiscal
 
2023,
driven by a decrease in contributions from volume growth, partially offset
 
by favorable net price realization and mix.
The components of Pet organic net sales growth are shown in the following
 
table:
 
Quarter Ended
Nine-Month Period Ended
Feb. 25, 2024
Feb. 25, 2024
Contributions from organic volume growth (a)
(5)
pts
(7)
pts
Organic net price realization and mix
2
pts
5
pts
Organic net sales growth
(3)
pts
(2)
pts
Foreign currency exchange
Flat
Flat
Net sales growth
(3)
pts
(2)
pts
Note: Table may
 
not foot due to rounding.
(a) Measured in tons based on the stated weight of our product shipments.
Pet organic
 
net sales
 
decreased 3
 
percent in
 
the third
 
quarter of
 
fiscal 2024,
 
compared to
 
the same
 
period in
 
fiscal 2023,
 
driven by
 
a
decrease in contributions from organic volume growth,
 
partially offset by favorable organic net price
 
realization and mix.
Pet organic
 
net sales
 
decreased 2
 
percent in
 
the nine-month
 
period
 
ended February
 
25, 2024,
 
compared to
 
the same
 
period in
 
fiscal
2023,
 
driven by a decrease in contributions
 
from organic volume growth,
 
partially offset by favorable
 
organic net price realization and
mix.
Segment
 
operating
 
profit
 
increased
 
25
 
percent
 
to
 
$128
 
million
 
in
 
the
 
third
 
quarter
 
of
 
fiscal
 
2024,
 
compared
 
to
 
$103 million
 
in
 
the
same
 
period
 
in
 
fiscal
 
2023,
 
primarily
 
driven
 
by
 
lower
 
input
 
costs
 
and
 
favorable
 
net
 
price
 
realization
 
and
 
mix,
 
partially
 
offset
 
by
 
a
decrease in contributions from
 
volume growth and an increase
 
in SG&A expenses.
 
Segment operating profit increased
 
25 percent on a
constant-currency basis in the third quarter of fiscal 2024,
 
compared to the same period in fiscal 2023 (see the “Non-GAAP Measures”
section below for our use of this measure not defined by GAAP).
Segment
 
operating
 
profit
 
increased
 
10
 
percent
 
to
 
$342 million
 
in
 
the
 
nine-month
 
period
 
ended
 
February
 
25,
 
2024,
 
compared
 
to
$312 million
 
in
 
the
 
same
 
period
 
in
 
fiscal
 
2023,
 
primarily
 
driven
 
by
 
favorable
 
net
 
price
 
realization
 
and
 
mix
 
and
 
lower
 
input
 
costs,
partially
 
offset
 
by
 
a
 
decrease
 
in
 
contributions
 
from
 
volume
 
growth
 
and
 
an
 
increase
 
in
 
SG&A
 
expenses.
 
Segment
 
operating
 
profit
increased 10
 
percent on a
 
constant-currency basis in
 
the nine-month period
 
ended February 25,
 
2024, compared
 
to the same
 
period in
fiscal 2023 (see the “Non-GAAP Measures” section below for our use of this measure
 
not defined by GAAP).
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
29
North America Foodservice Segment Results
North America Foodservice net sales were as follows:
 
Quarter Ended
Nine-Month Period Ended
Feb. 25,
2024
Feb. 25, 2024 vs
Feb. 26, 2023
Feb. 26,
2023
Feb. 25,
2024
Feb. 25, 2024 vs
Feb. 26, 2023
Feb. 26,
2023
Net sales (in millions)
$
551.7
1
%
$
547.8
$
1,669.7
3
%
$
1,627.2
Contributions from volume growth (a)
Flat
2
pts
Net price realization and mix
Flat
1
pt
Foreign currency exchange
Flat
Flat
Note: Table may
 
not foot due to rounding.
(a)
 
Measured in tons based on the stated weight of our product shipments.
North
 
America
 
Foodservice
 
net
 
sales
 
increased
 
1
 
percent
 
in
 
the
 
third
 
quarter
 
of
 
fiscal
 
2024,
 
compared
 
to
 
the
 
same
 
period
 
in
 
fiscal
2023,
 
driven by slightly favorable net price realization and mix and a slight increase in contributions
 
from volume growth.
North
 
America
 
Foodservice net
 
sales increased
 
3 percent
 
in the
 
nine-month
 
period ended
 
February 25,
 
2024,
 
compared to
 
the same
period in fiscal 2023, driven by an increase in contributions from volume growth
 
and favorable net price realization and mix.
The components of North America Foodservice organic
 
net sales growth are shown in the following table:
 
Quarter Ended
Nine-Month Period Ended
Feb. 25, 2024
Feb. 25, 2024
Contributions from organic volume growth (a)
Flat
1
pt
Organic net price realization and mix
Flat
Flat
Organic net sales growth
1
pt
1
pt
Foreign currency exchange
Flat
Flat
Acquisition (b)
Flat
1
pt
Net sales growth
1
pt
3
pts
Note: Table may
 
not foot due to rounding.
(a) Measured in tons based on the stated weight of our product shipments.
(b) Acquisition of TNT Crust in fiscal 2023. Please see Note 2 to the Consolidated Financial Statements
 
in Part I, Item 1 of this report.
North America
 
Foodservice organic
 
net sales
 
increased 1
 
percent in
 
the third
 
quarter of
 
fiscal 2024,
 
compared to
 
the same
 
period in
fiscal
 
2023,
 
driven
 
by
 
slightly
 
favorable
 
organic
 
net
 
price
 
realization
 
and
 
mix
 
and
 
a
 
slight
 
increase
 
in
 
contributions
 
from
 
organic
volume growth.
North America Foodservice
 
organic net
 
sales increased 1
 
percent in the
 
nine-month period
 
ended February 25,
 
2024, compared
 
to the
same period in fiscal 2023, driven by an increase in contributions from organic
 
volume growth.
Segment operating
 
profit decreased
 
1 percent
 
to $82
 
million in
 
the third
 
quarter of
 
fiscal 2024,
 
compared to
 
$82 million in
 
the same
period in fiscal
 
2023, primarily driven by
 
higher input costs and
 
an increase in SG&A
 
expenses, partially offset
 
by favorable net price
realization
 
and
 
mix.
 
Segment
 
operating
 
profit
 
decreased
 
1
 
percent
 
on
 
a
 
constant-currency
 
basis
 
in
 
the
 
third
 
quarter
 
of
 
fiscal
 
2024,
compared to the
 
same period in
 
fiscal 2023 (see
 
the “Non-GAAP Measures”
 
section below for
 
our use of
 
this measure not
 
defined by
GAAP).
Segment
 
operating
 
profit
 
increased
 
9
 
percent
 
to
 
$236
 
million
 
in
 
the
 
nine-month
 
period
 
ended
 
February
 
25,
 
2024,
 
compared
 
to
$218 million in
 
the same
 
period in
 
fiscal 2023,
 
primarily driven
 
by favorable
 
net price
 
realization and
 
mix, partially
 
offset by
 
higher
input costs and
 
an increase in SG&A
 
expenses.
 
Segment operating profit
 
increased 9 percent
 
on a constant-currency
 
basis in the nine-
month period ended February 25, 2024,
 
compared to the same period in fiscal
 
2023 (see the “Non-GAAP Measures” section
 
below for
our use of this measure not defined by GAAP).
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
30
UNALLOCATED
 
CORPORATE
 
ITEMS
Unallocated corporate expenses
 
totaled $64 million in
 
the third quarter
 
of fiscal 2024, compared
 
to $296 million in the
 
same period in
fiscal
 
2023.
 
In
 
the
 
third
 
quarter
 
of
 
fiscal
 
2024,
 
certain
 
compensation
 
and
 
benefits
 
expenses
 
and
 
charitable
 
contributions
 
decreased
compared to the
 
same period last year.
 
In the third
 
quarter of fiscal 2024
 
,
 
we recorded a $26 million
 
net increase in expense
 
related to
the mark-to-market valuation
 
of certain commodity
 
positions and grain inventories
 
,
 
compared to a $67 million
 
net increase in expense
in the same period
 
last year.
 
We
 
recorded $3 million
 
of net losses related
 
to valuation adjustments
 
on certain corporate
 
investments in
the third quarter
 
of fiscal
 
2024, compared
 
to $20 million
 
of net
 
losses in
 
the third
 
quarter of
 
fiscal 2023.
 
In the
 
third quarter
 
of fiscal
2024,
 
we recorded $31 million
 
of net recoveries
 
related to a voluntary
 
recall on certain
 
international
Häagen-Dazs
 
ice cream products
in fiscal 2023, compared to a $1 million charge
 
in the same period last year.
 
We recorded
 
$1 million of restructuring charges in cost of
sales in the
 
third quarter of
 
fiscal 2023.
 
In addition, we
 
recorded $1 million
 
of integration costs
 
primarily related
 
to our acquisition
 
of
TNT Crust in the third quarter of fiscal 2023.
Unallocated corporate
 
expenses totaled $308
 
million in the
 
nine-month period
 
ended February
 
25, 2024, compared
 
to $842 million
 
in
the
 
same
 
period
 
last
 
year.
 
We
 
recorded
 
a
 
$6
 
million
 
net
 
increase
 
in
 
expense
 
related
 
to
 
the
 
mark-to-market
 
valuation
 
of
 
certain
commodity
 
positions
 
and
 
grain
 
inventories
 
in
 
the
 
nine-month
 
period
 
ended
 
February
 
25,
 
2024,
 
compared
 
to
 
a
 
$266
 
million
 
net
increase in expense in the same
 
period last year.
 
In the nine-month period ended February
 
25, 2024, certain compensation and
 
benefits
expenses and
 
charitable contributions
 
decreased compared
 
to the same
 
period last year.
 
We
 
recorded $25
 
million of net
 
losses related
to valuation adjustments on certain
 
corporate investments in the nine-month
 
period ended February 25, 2024,
 
compared to $82 million
of net
 
losses related
 
to valuation
 
adjustments and
 
the sale
 
of certain
 
corporate investments
 
in the
 
same period
 
last year.
 
In the
 
nine-
month period ended
 
February 25, 2024,
 
we recorded $31 million
 
of net recoveries related
 
to a voluntary recall
 
on certain international
Häagen-Dazs
ice
 
cream
 
products
 
in
 
fiscal
 
2023,
 
compared
 
to
 
a
 
$26
 
million
 
charge
 
in
 
the
 
same
 
period
 
last
 
year.
 
We
 
recorded
 
$17
million of restructuring
 
charges and $2
 
million of restructuring
 
initiative project-related costs in
 
cost of sales in
 
the nine-month period
ended February 25,
 
2024, compared to
 
$2 million of restructuring
 
charges in cost
 
of sales in the
 
same period last year.
 
In addition, we
recorded $5 million of
 
integration costs primarily related
 
to our acquisition of TNT
 
Crust and $2 million of
 
transaction costs primarily
related
 
to the
 
sale of
 
our
 
Helper
 
main meals
 
and Suddenly
 
Salad
 
side dishes
 
business
 
in the
 
nine-month
 
period ended
 
February
 
26,
2023.
LIQUIDITY
 
AND CAPITAL
 
RESOURCES
During the
 
nine-month period
 
ended February
 
25, 2024,
 
cash provided
 
by operations
 
was $2,439 million
 
compared to
 
$2,027 million
in the
 
same period
 
last year.
 
The $412
 
million increase
 
was mainly
 
driven by
 
a $414
 
million increase
 
in net
 
earnings, excluding
 
the
$445 million net divestitures gain in fiscal 2023.
Cash used by
 
investing activities during
 
the nine-month period
 
ended February 25,
 
2024, was $508
 
million compared to
 
cash used by
investing activities
 
of $6 million
 
for the
 
same period
 
in fiscal
 
2023. During
 
the first
 
quarter of
 
fiscal 2023,
 
we completed
 
the sale
 
of
the Helper main
 
meals and Suddenly
 
Salad side dishes
 
business for
 
$607 million
 
cash. In the
 
first quarter
 
of fiscal
 
2023, we
 
acquired
TNT
 
Crust
 
for
 
$252
 
million
 
cash,
 
net
 
of
 
cash
 
acquired.
 
In
 
addition,
 
we
 
spent
 
$486
 
million
 
on
 
purchases
 
of
 
land,
 
buildings,
 
and
equipment in the nine months ended February 25, 2024, compared
 
to $351 million in the same period last year.
Cash
 
used
 
by
 
financing
 
activities
 
during
 
the
 
nine-month
 
period
 
ended
 
February
 
25,
 
2024,
 
was
 
$1,928
 
million
 
compared
 
to
$1,956 million of cash
 
used by financing activities
 
in the same period
 
in fiscal 2023. We
 
paid $1,028 million of
 
dividends in the nine-
month period
 
ended February 25,
 
2024, compared
 
to $967 million in
 
the same period
 
last year.
 
We
 
paid $1,602 million
 
for purchases
of common
 
stock for
 
treasury in
 
the nine-month
 
period ended
 
February 25,
 
2024, compared
 
to $1,152
 
million in
 
the same
 
period in
fiscal 2023.
 
In addition,
 
we had
 
$754 million
 
of net
 
debt issuances
 
in the
 
nine-month period
 
ended February
 
25, 2024,
 
compared to
$61 million of net debt issuances in the same period a year ago.
 
As
 
of
 
February
 
25,
 
2024,
 
we
 
had
 
$511 million
 
of
 
cash
 
and
 
cash
 
equivalents
 
in
 
foreign
 
jurisdictions. In
 
anticipation
 
of
 
repatriating
funds from
 
foreign jurisdictions,
 
we record
 
local country
 
withholding taxes
 
on our
 
international earnings,
 
as applicable.
 
Furthermore,
we
 
may
 
repatriate
 
our
 
cash
 
and
 
cash
 
equivalents
 
held
 
by
 
our
 
foreign
 
subsidiaries
 
without
 
such
 
funds
 
being
 
subject
 
to
 
further
 
U.S.
income tax liability.
 
Earnings prior to fiscal 2018 from our foreign subsidiaries remain permanently
 
reinvested in those jurisdictions.
 
 
 
 
 
 
 
 
 
 
 
31
The following table details the fee-paid committed and uncommitted credit
 
lines we had available as of February 25, 2024:
 
In Billions
Facility
 
Amount
Borrowed
Amount
Committed credit facility expiring April 2026
$
2.7
$
-
Uncommitted credit facilities
0.6
-
Total committed
 
and uncommitted credit facilities
$
3.3
$
-
The
 
third-party
 
holder
 
of
 
the
 
General
 
Mills
 
Cereals,
 
LLC
 
(GMC)
 
Class A
 
Interests
 
receives
 
quarterly
 
preferred
 
distributions
 
from
available net
 
income based
 
on the application
 
of a
 
floating preferred
 
return rate
 
to the
 
holder’s capital
 
account balance
 
established in
the most
 
recent mark
 
-to-market valuation
 
(currently
 
$252 million). The
 
floating preferred
 
return rate
 
on GMC’s
 
Class A Interests
 
is
the sum of three
 
-month Term
 
SOFR plus 186
 
basis points. The preferred
 
return rate is adjusted
 
every three years
 
through a negotiated
agreement with the Class A Interest holder or through a remarketing auction.
 
We
 
have an option
 
to purchase the
 
Class A Interests for
 
consideration equal to
 
the then current
 
capital account value,
 
plus any unpaid
preferred return
 
and the
 
prescribed make-whole
 
amount. If
 
we purchase
 
these interests,
 
any change
 
in the
 
third-party holder’s
 
capital
account
 
from
 
its
 
original
 
value
 
will
 
be
 
charged
 
directly
 
to
 
retained
 
earnings
 
and
 
will
 
increase
 
or
 
decrease
 
the
 
net
 
earnings
 
used
 
to
calculate EPS in that period.
 
To ensure availability
 
of funds, we maintain bank credit lines and have commercial paper programs
 
available to us in the United States
and Europe.
Certain
 
of
 
our
 
long-term
 
debt
 
agreements,
 
our
 
credit
 
facilities,
 
and
 
our
 
noncontrolling
 
interests
 
contain
 
restrictive
 
covenants.
 
As
 
of
February 25, 2024, we were in compliance with all of these covenants.
 
We
 
have
 
$812
 
million
 
of
 
long-term
 
debt
 
maturing
 
in
 
the
 
next
 
12
 
months
 
that
 
is
 
classified
 
as
 
current,
 
including
 
€750
 
million
 
of
floating-rate notes
 
due November
 
8, 2024.
 
We
 
believe that
 
cash flows
 
from operations,
 
together with
 
available short-
 
and long-term
debt financing, will be adequate to meet our liquidity and capital needs for
 
at least the next 12 months.
CRITICAL ACCOUNTING ESTIMATES
Our significant accounting policies are described in Note 2
 
to the Consolidated Financial Statements included in
 
our Annual Report on
Form
 
10-K for
 
the fiscal
 
year ended
 
May 28,
 
2023. The
 
accounting policies
 
used in
 
preparing our
 
interim fiscal
 
2024 Consolidated
Financial
 
Statements
 
are
 
the
 
same
 
as
 
those
 
described
 
in
 
our
 
Form
 
10-K
 
with
 
the
 
exception
 
of
 
the
 
new
 
accounting
 
requirements
adopted in the first quarter of fiscal 2024. Please see Note 1
 
to the Consolidated Financial Statements in Part I, Item 1 of
 
this report for
additional information.
Our
 
critical
 
accounting
 
estimates
 
are
 
those
 
that
 
have
 
meaningful
 
impact
 
on
 
the
 
reporting
 
of
 
our
 
financial
 
condition
 
and
 
results
 
of
operations.
 
These
 
estimates
 
include
 
our
 
accounting
 
for
 
revenue
 
recognition,
 
valuation
 
of
 
long-lived
 
assets,
 
intangible
 
assets,
 
stock-
based compensation,
 
income taxes,
 
and defined
 
benefit pension,
 
other postretirement
 
benefit, and
 
postemployment benefit
 
plans. The
assumptions and methodologies
 
used in the
 
determination of
 
those estimates as
 
of February 25,
 
2024, are the
 
same as those
 
described
in our Annual Report on Form 10-K for the fiscal year ended May 28, 2023.
Our
 
annual
 
goodwill
 
and
 
indefinite-lived
 
intangible
 
assets
 
impairment
 
test
 
was
 
performed
 
on
 
the
 
first
 
day
 
of
 
the
 
second
 
quarter
 
of
fiscal 2024. As a
 
result of lower future profitability
 
projections for our Latin
 
America reporting unit,
 
we determined that the
 
fair value
of the
 
reporting unit
 
was less
 
than its
 
book value
 
and recorded
 
a $117
 
million non-cash
 
goodwill impairment
 
charge in
 
restructuring,
impairment,
 
and
 
other
 
exit
 
costs
 
in
 
our
 
Consolidated
 
Statements
 
of
 
Earnings.
 
Our
 
estimates
 
of
 
fair
 
value
 
for
 
goodwill
 
impairment
testing
 
were
 
determined
 
based
 
on
 
a
 
discounted
 
cash
 
flow
 
model
 
using
 
inputs
 
from
 
our
 
long-range
 
planning
 
process
 
to
 
determine
growth
 
rates
 
for
 
sales
 
and
 
profits.
 
Other
 
significant
 
assumptions
 
include
 
weighted
 
average
 
cost
 
of
 
capital
 
rates,
 
perpetuity
 
growth
assumptions, market comparables, and tax rates. The fair value is a Level 3
 
asset in the fair value hierarchy.
All other intangible
 
asset fair values
 
were substantially
 
in excess of
 
the carrying
 
values, except for
 
the
True Chews
 
and
Uncle Toby’s
brand intangible
 
assets. In
 
addition, while
 
having significant
 
coverage as
 
of our
 
fiscal 2024
 
assessment date,
 
the
Progresso
,
Nudges
,
Top
 
Chews
,
 
and
EPIC
 
brand
 
intangible
 
assets
 
had
 
risk
 
of
 
decreasing
 
coverage.
 
We
 
will
 
continue
 
to
 
monitor
 
these
 
businesses
 
for
potential impairment.
RECENTLY
 
ISSUED ACCOUNTING PRONOUNCEMENTS
In March 2024, the
 
Securities and Exchange Commission
 
issued final rules on
 
the enhancement and standardization
 
of climate-related
disclosures. The
 
rules require
 
disclosure of,
 
among other
 
things: material
 
climate-related risks;
 
activities to
 
mitigate or
 
adapt to
 
such
 
 
 
 
 
 
32
risks; governance
 
and management of
 
such risks; and
 
material greenhouse gas
 
(GHG) emissions from
 
operations owned
 
or controlled
(Scope
 
1)
 
and/or
 
indirect
 
emissions
 
from
 
purchased
 
energy
 
consumed
 
in
 
operations
 
(Scope
 
2).
 
Additionally,
 
the
 
rules
 
require
disclosure in the notes to the financial statements of the effects of
 
severe weather events and other natural conditions, subject to
 
certain
materiality thresholds. The rules will become effective
 
on a phased-in timeline starting in fiscal years beginning
 
in calendar year 2025,
which for us is fiscal 2026. We
 
are in the process of analyzing the impact of the rules on our disclosures.
In December 2023, the
 
Financial Accounting Standards Board
 
(FASB) issued
 
Accounting Standards Update (ASU)
 
2023-09 requiring
enhanced
 
income
 
tax
 
disclosures.
 
The
 
ASU
 
requires
 
disclosure
 
of
 
specific
 
categories
 
and
 
disaggregation
 
of
 
information
 
in
 
the
 
rate
reconciliation table. The
 
ASU also requires
 
disclosure of disaggregated
 
information related to
 
income taxes paid,
 
income or loss
 
from
continuing
 
operations
 
before
 
income
 
tax
 
expense
 
or
 
benefit,
 
and
 
income
 
tax
 
expense
 
or
 
benefit
 
from
 
continuing
 
operations.
 
The
requirements
 
of
 
the
 
ASU
 
are
 
effective
 
for
 
annual
 
periods
 
beginning
 
after
 
December
 
15,
 
2024,
 
which
 
for
 
us
 
is
 
fiscal
 
2026.
 
Early
adoption is permitted
 
and the amendments
 
should be applied
 
on a prospective
 
basis. Retrospective application
 
is permitted. We
 
are in
the process of analyzing the impact of the ASU on our related disclosures.
In
 
November
 
2023,
 
the
 
FASB
 
issued
 
ASU
 
2023-07
 
requiring
 
enhanced
 
segment
 
disclosures.
 
The
 
ASU
 
requires
 
disclosure
 
of
significant
 
segment
 
expenses
 
regularly
 
provided
 
to
 
the
 
chief
 
operating
 
decision
 
maker
 
(CODM)
 
included
 
within
 
segment
 
operating
profit
 
or
 
loss.
 
Additionally,
 
the
 
ASU
 
requires
 
a
 
description
 
of
 
how
 
the
 
CODM
 
utilizes
 
segment
 
operating
 
profit
 
or
 
loss
 
to
 
assess
segment performance.
 
The requirements
 
of the
 
ASU are effective
 
for annual
 
periods beginning
 
after December
 
15, 2023,
 
and interim
periods within
 
fiscal years
 
beginning after
 
December 15,
 
2024. For
 
us, annual
 
reporting requirements
 
will be
 
effective for
 
our fiscal
2025 and
 
interim reporting
 
requirements will
 
be effective
 
beginning with
 
our first
 
quarter of
 
fiscal 2026.
 
Early adoption
 
is permitted
and retrospective
 
application is
 
required
 
for all
 
periods presented.
 
We
 
are in
 
the process
 
of analyzing
 
the impact
 
of the
 
ASU on
 
our
related disclosures.
NON-GAAP MEASURES
We
 
have
 
included
 
in
 
this
 
report
 
measures
 
of
 
financial
 
performance
 
that
 
are not
 
defined
 
by
 
GAAP.
 
We
 
believe
 
that
 
these
 
measures
provide useful information to investors, and include these measures in other
 
communications to investors.
 
For each
 
of these
 
non-GAAP financial
 
measures, we
 
are providing
 
below a
 
reconciliation of
 
the differences
 
between the
 
non-GAAP
measure and the most
 
directly comparable GAAP measure,
 
an explanation of why
 
we believe the non-GAAP
 
measure provides useful
information to
 
investors, and
 
any additional
 
material purposes
 
for which
 
our management
 
or Board
 
of Directors
 
uses the
 
non-GAAP
measure. These non-GAAP measures should be viewed in addition to, and not
 
in lieu of, the comparable GAAP measure.
Significant Items Impacting Comparability
Several
 
measures
 
below
 
are
 
presented
 
on
 
an
 
adjusted
 
basis.
 
The
 
adjustments
 
are
 
either
 
items
 
resulting
 
from
 
infrequently
 
occurring
events or items that, in management’s
 
judgment, significantly affect the year-to-year
 
assessment of operating results.
 
The following are descriptions of significant items impacting comparability
 
of our results.
 
Goodwill impairment
Non-cash
 
goodwill
 
impairment
 
charge
 
related
 
to
 
our
 
Latin
 
America
 
reporting
 
unit
 
in
 
fiscal
 
2024.
 
Please
 
see
 
Note
 
4
 
to
 
the
Consolidated Financial Statements in Part I, Item 1 of this report.
Product recall, net
Costs related to the fiscal 2023 voluntary recall of certain international
Häagen-Dazs
 
ice cream products, net of recoveries.
 
Restructuring charges and project-related costs
Restructuring
 
charges
 
and
 
project-related
 
costs
 
related
 
to
 
commercial
 
strategy
 
restructuring
 
actions
 
and
 
previously
 
announced
restructuring actions
 
recorded in
 
fiscal 2024.
 
Restructuring charges
 
for previously
 
announced restructuring
 
actions recorded
 
in fiscal
2023. Please see Note 3 to the Consolidated Financial Statements in Part I, Item 1
 
of this report.
Investment activity, net
Valuation
 
adjustments of
 
certain corporate
 
investments in
 
fiscal 2024. Valuation
 
adjustments and the
 
loss on sale
 
of certain corporate
investments in fiscal 2023.
 
Mark-to-market effects
Net
 
mark-to-market
 
valuation
 
of
 
certain
 
commodity
 
positions
 
recognized
 
in
 
unallocated
 
corporate
 
items.
 
Please
 
see
 
Note
 
6
 
to
 
the
Consolidated Financial Statements in Part I, Item 1 of this report.
 
 
 
 
 
33
Transaction costs
Immaterial
 
transaction
 
costs
 
incurred
 
in
 
fiscal
 
2024.
 
Transaction
 
costs
 
primarily
 
related
 
to
 
the
 
sale
 
of
 
our
 
Helper
 
main
 
meals
 
and
Suddenly Salad side dishes
 
business in fiscal 2023. Please
 
see Note 2 to the
 
Consolidated Financial Statements in Part
 
I, Item 1 of
 
this
report.
Acquisition integration costs
Integration
 
costs
 
primarily
 
resulting
 
from
 
the
 
acquisition
 
of
 
TNT
 
Crust
 
in
 
fiscal
 
2024
 
and
 
fiscal
 
2023.
 
Please
 
see
 
Note
 
2
 
to
 
the
Consolidated Financial Statements in Part I, Item 1 of this report.
Divestitures gain, net
Net divestitures
 
gain primarily
 
related to
 
the sale
 
of our
 
Helper main
 
meals and
 
Suddenly Salad
 
side dishes
 
business in
 
fiscal 2023.
Please see Note 2 to the Consolidated Financial Statements in Part I, Item 1 of this report.
Organic Net Sales Growth Rates
We
 
provide organic
 
net sales
 
growth rates
 
for our
 
consolidated net
 
sales and
 
segment net
 
sales. This
 
measure is
 
used in
 
reporting to
our
 
Board
 
of
 
Directors
 
and
 
executive
 
management
 
and
 
as
 
a
 
component
 
of
 
the
 
measurement
 
of
 
our
 
performance
 
for
 
incentive
compensation purposes.
 
We
 
believe that
 
organic net
 
sales growth
 
rates provide
 
useful information
 
to investors
 
because they
 
provide
transparency
 
to
 
underlying
 
performance
 
in
 
our
 
net
 
sales
 
by
 
excluding
 
the
 
effect
 
that
 
foreign
 
currency
 
exchange
 
rate
 
fluctuations,
acquisitions, divestitures,
 
and a 53
rd
 
week, when applicable,
 
have on year-to-year comparability.
 
A reconciliation of
 
these measures to
reported net
 
sales growth
 
rates, the
 
relevant GAAP
 
measures, are
 
included in
 
our Consolidated
 
Results of
 
Operations and
 
Results of
Segment Operations discussions in the MD&A above.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
34
Adjusted Operating Profit as a Percent of Net Sales (Adjusted Operating Profit
 
Margin)
We believe
 
this measure provides useful information
 
to investors because it is important
 
for assessing our operating profit margin
 
on a
comparable basis.
Our adjusted operating profit margins are calculated as follows:
Quarter Ended
Feb. 25, 2024
Feb. 26, 2023
In Millions
Value
Percent of
Net Sales
Value
 
Percent of
Net Sales
Operating profit as reported
$
910.7
17.9
%
$
730.2
14.2
%
Product recall, net
(31.1)
(0.6)
%
1.1
-
%
Restructuring charges
5.9
0.1
%
2.1
-
%
Investment activity, net
2.7
0.1
%
20.1
0.4
%
Mark-to-market effects
25.7
0.5
%
66.6
1.3
%
Project-related costs
0.5
-
%
-
-
%
Acquisition integration costs
-
-
%
0.7
-
%
Divestitures gain, net
-
-
%
(13.7)
(0.3)
%
Adjusted operating profit
$
914.5
17.9
%
$
807.0
15.7
%
Nine-Month Period Ended
Feb. 25, 2024
Feb. 26, 2023
In Millions
Value
 
Percent of
Net Sales
Value
 
Percent of
Net Sales
Operating profit as reported
$
2,652.5
17.5
%
$
2,615.6
17.4
%
Goodwill impairment
117.1
0.8
%
-
-
%
Product recall, net
(30.7)
(0.2)
%
25.5
0.2
%
Restructuring charges
30.5
0.2
%
16.0
0.1
%
Investment activity, net
25.2
0.2
%
82.1
0.5
%
Mark-to-market effects
5.9
-
%
266.4
1.8
%
Project-related costs
1.6
-
%
-
-
%
Transaction costs
0.6
-
%
2.0
-
%
Acquisition integration costs
0.2
-
%
5.0
-
%
Divestitures gain, net
-
-
%
(444.6)
(3.0)
%
Adjusted operating profit
$
2,802.9
18.5
%
$
2,567.9
17.0
%
Note: Tables
 
may not foot due to rounding.
 
For more information on the reconciling items, please refer to the Significant Items Impacting Comparability section above.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
35
Adjusted Operating Profit Growth on a Constant-currency Basis
This measure is used in reporting
 
to our Board of Directors and
 
executive management and as a
 
component of the measurement of
 
our
performance for
 
incentive compensation purposes.
 
We
 
believe that
 
this measure provides
 
useful information
 
to investors because
 
it is
the
 
operating
 
profit
 
measure
 
we
 
use
 
to
 
evaluate
 
operating
 
profit
 
performance
 
on
 
a
 
comparable
 
year-to-year
 
basis.
 
The
 
measure
 
is
evaluated on
 
a constant-currency
 
basis by
 
excluding the
 
effect that
 
foreign currency
 
exchange rate
 
fluctuations have
 
on year-to-year
comparability given the volatility in foreign currency exchange rates.
 
Our adjusted operating profit growth on a constant-currency basis is calculated
 
as follows:
 
Quarter Ended
Nine-Month Period Ended
Feb. 25, 2024
Feb. 26, 2023
Change
Feb. 25, 2024
Feb. 26, 2023
Change
Operating profit as reported
$
910.7
$
730.2
25
%
$
2,652.5
$
2,615.6
1
%
Goodwill impairment
-
-
117.1
-
Product recall, net
(31.1)
1.1
(30.7)
25.5
Restructuring charges
5.9
2.1
30.5
16.0
Investment activity, net
2.7
20.1
25.2
82.1
Mark-to-market effects
25.7
66.6
5.9
266.4
Project-related costs
0.5
-
1.6
-
Transaction costs
-
-
0.6
2.0
Acquisition integration costs
-
0.7
0.2
5.0
Divestitures gain, net
-
(13.7)
-
(444.6)
Adjusted operating profit
$
914.5
$
807.0
13
%
$
2,802.9
$
2,567.9
9
%
Foreign currency exchange impact
Flat
Flat
Adjusted operating profit growth,
 
 
on a constant-currency basis
14
%
9
%
Note: Table may not foot due to rounding.
For more information on the reconciling items, please refer to the Significant Items Impacting Comparability section above.
Adjusted Diluted EPS and Related Constant-currency Growth Rates
This measure
 
is used in
 
reporting to
 
our Board of
 
Directors and executive
 
management. We
 
believe that
 
this measure provides
 
useful
information to
 
investors because it
 
is the profitability
 
measure we use
 
to evaluate earnings
 
performance on
 
a comparable year-to-year
basis.
The reconciliation of our GAAP measure, diluted EPS, to adjusted diluted
 
EPS and the related constant-currency growth rates follows:
 
Quarter Ended
Nine-Month Period Ended
Per Share Data
Feb. 25, 2024
Feb. 26, 2023
Change
Feb. 25, 2024
Feb. 26, 2023
Change
Diluted earnings per share, as reported
$
1.17
$
0.92
27
%
$
3.33
$
3.28
2
%
Goodwill impairment
-
-
0.14
-
Product recall, net
(0.04)
-
(0.04)
0.03
Restructuring charges
0.01
-
0.04
0.02
Investment activity, net
-
0.03
0.03
0.11
Mark-to-market effects
0.04
0.09
0.01
0.34
Acquisition integration costs
-
-
-
0.01
Divestitures gain, net
-
(0.08)
-
(0.62)
Adjusted diluted earnings per share
$
1.17
$
0.97
21
%
$
3.51
$
3.18
10
%
Foreign currency exchange impact
(1)
pt
(1)
pt
Adjusted diluted earnings per share
 
 
growth, on a constant-currency basis
22
%
11
%
Note: Table may not foot due to rounding.
For more information on the reconciling items, please refer to the Significant Items Impacting Comparability section above.
See our reconciliation
 
below of the effective
 
income tax rate as
 
reported to the adjusted
 
effective income tax
 
rate for the tax
 
impact of
each item affecting comparability.
 
 
 
 
 
 
 
 
 
 
 
 
36
Constant-currency After-tax Earnings from Joint Ventures
 
Growth Rates
 
We
 
believe that
 
this measure
 
provides useful
 
information to
 
investors because
 
it provides
 
transparency to
 
underlying performance
 
of
our joint
 
ventures by
 
excluding the
 
effect
 
that foreign
 
currency exchange
 
rate fluctuations
 
have on
 
year-to-year
 
comparability given
volatility in foreign currency exchange markets.
 
After-tax earnings from joint ventures growth rates on a constant-currency
 
basis are calculated as follows:
 
Percentage Change in
After-Tax
 
Earnings from Joint
Ventures
 
as Reported
Impact of Foreign
Currency
Exchange
Percentage Change in After-Tax
Earnings from Joint Ventures
on Constant-Currency Basis
Quarter Ended Feb. 25, 2024
42
%
(22)
pts
64
%
Nine-Month Period Ended Feb. 25, 2024
14
%
(11)
pts
25
%
Note: Table may
 
not foot due to rounding.
Net Sales Growth Rates for Our Canada Operating Unit on Constant-currency
 
Basis
 
We
 
believe
 
that
 
this
 
measure
 
of
 
our
 
Canada
 
operating
 
unit
 
net
 
sales
 
provides
 
useful
 
information
 
to
 
investors
 
because
 
it
 
provides
transparency to
 
the underlying
 
performance for
 
the Canada operating
 
unit within our
 
North America Retail
 
segment by
 
excluding the
effect
 
that
 
foreign
 
currency
 
exchange
 
rate
 
fluctuations
 
have
 
on
 
year-to-year
 
comparability
 
given
 
volatility
 
in
 
foreign
 
currency
exchange markets.
Net sales growth rates for our Canada operating unit on a constant-currency
 
basis are calculated as follows:
 
Percentage Change in
Net Sales
as Reported
Impact of Foreign
Currency
Exchange
Percentage Change in
Net Sales on Constant-
Currency Basis
Quarter Ended Feb. 25, 2024
8
%
Flat
8
%
Nine-Month Period Ended Feb. 25, 2024
5
%
(2)
pts
7
%
Note: Table may
 
not foot due to rounding.
Constant-currency Segment Operating Profit Growth Rates
 
We
 
believe that
 
this measure
 
provides useful
 
information to
 
investors because
 
it provides
 
transparency to
 
underlying performance
 
of
our
 
segments
 
by
 
excluding
 
the
 
effect
 
that
 
foreign
 
currency
 
exchange
 
rate
 
fluctuations
 
have
 
on
 
year-to-year
 
comparability
 
given
volatility in foreign currency exchange markets.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
37
Our segments’ operating profit growth rates on a constant-currency
 
basis are calculated as follows:
 
Quarter Ended Feb. 25, 2024
Percentage Change in
Operating Profit
as Reported
Impact of Foreign
Currency
Exchange
Percentage Change in Operating
Profit on Constant-Currency
Basis
North America Retail
(4)
%
Flat
(4)
%
International
(57)
%
(4)
pts
(53)
%
Pet
25
%
Flat
25
%
North America Foodservice
(1)
%
Flat
(1)
%
Nine-Month Period Ended Feb. 25, 2024
Percentage Change in
Operating Profit
as Reported
Impact of Foreign
Currency
Exchange
Percentage Change in Operating
Profit on Constant-Currency
Basis
North America Retail
Flat
Flat
Flat
International
8
%
(6)
pts
14
%
Pet
10
%
Flat
10
%
North America Foodservice
9
%
Flat
9
%
Note: Tables may not
 
foot due to rounding.
Adjusted Effective Income Tax
 
Rates
 
We
 
believe
 
this
 
measure
 
provides
 
useful
 
information
 
to
 
investors
 
because
 
it
 
presents
 
the
 
adjusted
 
effective
 
income
 
tax
 
rate
 
on
 
a
comparable year-to-year basis.
 
Adjusted effective income tax rates are calculated as follows:
 
 
Quarter Ended
 
Nine-Month Period Ended
Feb. 25, 2024
Feb. 26, 2023
Feb. 25, 2024
Feb. 26, 2023
In Millions
(Except Per Share Data)
Pretax
Earnings
(a)
Income
Taxes
Pretax
Earnings
(a)
Income
Taxes
Pretax
Earnings
(a)
Income
Taxes
Pretax
Earnings
(a)
Income
Taxes
As reported
$
807.6
$
149.3
$
653.5
$
108.3
$
2,351.7
$
458.5
$
2,403.1
$
471.5
Goodwill impairment
-
-
-
-
117.1
34.7
-
-
Product recall, net
(31.1)
(7.2)
1.1
0.3
(30.7)
(7.1)
25.5
5.9
Restructuring charges
5.9
(1.2)
2.1
0.7
30.5
8.0
16.0
4.5
Investment activity, net
2.7
2.2
20.1
4.5
25.2
7.4
82.1
18.0
Mark-to-market effects
25.7
6.0
66.6
15.3
5.9
1.4
266.4
61.3
Project-related costs
0.5
0.1
-
-
1.6
0.5
-
-
Transaction costs
-
-
-
-
0.6
-
2.0
0.6
Acquisition integration costs
-
-
0.7
0.1
0.2
0.1
5.0
1.1
Divestitures gain, net
-
-
(13.7)
28.7
-
-
(444.6)
(73.2)
As adjusted
$
811.3
$
149.4
$
730.3
$
157.8
$
2,502.1
$
503.6
$
2,355.4
$
489.6
Effective tax rate:
As reported
18.5%
16.6%
19.5%
19.6%
As adjusted
18.4%
21.6%
20.1%
20.8%
Sum of adjustment to income taxes
$
0.1
$
49.5
$
45.1
$
18.1
Average number
 
of common shares
- diluted EPS
572.8
599.0
582.5
602.4
Impact of income tax adjustments
on adjusted diluted EPS
$
-
$
(0.08)
$
(0.08)
$
(0.03)
Note: Table may not foot due to rounding.
(a)
Earnings before income taxes and after-tax earnings from joint ventures.
 
For more information on the reconciling items, please refer to the Significant Items Impacting Comparability section above.
38
Glossary
AOCI
. Accumulated other comprehensive income (loss).
Adjusted diluted EPS.
 
Diluted EPS adjusted for certain items affecting year-to-year
 
comparability.
Adjusted operating profit.
 
Operating profit adjusted for certain items affecting year-to-year
 
comparability.
Adjusted operating profit
 
margin.
Operating profit adjusted
 
for certain items
 
affecting year-over-year
 
comparability,
 
divided by net
sales.
Constant currency.
 
Financial results
 
translated to
 
United States
 
dollars using
 
constant foreign
 
currency exchange
 
rates based
 
on the
rates
 
in
 
effect
 
for
 
the
 
comparable
 
prior-year
 
period.
 
To
 
present
 
this
 
information,
 
current
 
period
 
results
 
for
 
entities
 
reporting
 
in
currencies other
 
than United
 
States dollars
 
are translated
 
into United
 
States dollars
 
at the
 
average exchange
 
rates in
 
effect during
 
the
corresponding
 
period
 
of
 
the
 
prior
 
fiscal
 
year,
 
rather
 
than
 
the
 
actual
 
average
 
exchange
 
rates
 
in
 
effect
 
during
 
the
 
current
 
fiscal
 
year.
Therefore,
 
the
 
foreign
 
currency
 
impact
 
is
 
equal
 
to
 
current
 
year
 
results
 
in
 
local
 
currencies
 
multiplied
 
by
 
the
 
change
 
in
 
the
 
average
foreign currency exchange rate between the current fiscal period and the corresponding
 
period of the prior fiscal year.
 
Core working capital.
 
Accounts receivable plus inventories less accounts payable.
Derivatives.
Financial instruments such
 
as futures, swaps,
 
options, and forward
 
contracts that we
 
use to manage
 
our risk arising
 
from
changes in commodity prices, interest rates, foreign exchange rates, and stock
 
prices.
Euribor.
 
Euro Interbank Offered Rate.
Fair value
 
hierarchy.
For purposes
 
of fair
 
value measurement,
 
we categorize
 
assets and
 
liabilities into
 
one of
 
three levels
 
based on
the assumptions
 
(inputs) used
 
in valuing
 
the asset or
 
liability.
 
Level 1 provides
 
the most reliable
 
measure of
 
fair value, while
 
Level 3
generally requires significant management judgment. The three levels are
 
defined as follows:
 
Level 1:
 
Unadjusted quoted prices in active markets for identical assets or liabilities.
Level 2:
 
Observable inputs other than quoted prices included in
 
Level 1, such as quoted prices for similar assets or liabilities in
active markets or quoted prices for identical assets or liabilities in inactive markets.
Level 3:
 
Unobservable inputs reflecting management’s
 
assumptions about the inputs used in pricing the asset or liability.
Free cash flow.
 
Net cash provided by operating activities less purchases of land, buildings, and equipment.
Generally Accepted
 
Accounting Principles
 
(GAAP).
Guidelines, procedures,
 
and practices
 
that we
 
are required
 
to use in
 
recording
and reporting accounting information in our financial statements.
Goodwill.
The difference
 
between the purchase
 
price of acquired
 
companies plus the fair
 
value of any noncontrolling
 
and redeemable
interests and the related fair values of net assets acquired.
 
Gross margin.
 
Net sales less cost of sales.
Hedge accounting.
Accounting for qualifying
 
hedges that allows changes in
 
a hedging instrument’s
 
fair value to offset
 
corresponding
changes in
 
the hedged
 
item in
 
the same
 
reporting period.
 
Hedge accounting
 
is permitted
 
for certain
 
hedging instruments
 
and hedged
items
 
only
 
if
 
the
 
hedging
 
relationship
 
is
 
highly
 
effective,
 
and
 
only
 
prospectively
 
from
 
the
 
date
 
a
 
hedging
 
relationship
 
is
 
formally
documented.
Holistic Margin Management
 
(HMM).
 
Company-wide initiative to
 
use productivity savings, mix
 
management, and price realization
to offset input cost inflation, protect margins,
 
and generate funds to reinvest in sales-generating activities.
Interest
 
bearing
 
instruments.
Notes
 
payable,
 
long-term
 
debt,
 
including
 
current
 
portion,
 
cash
 
and
 
cash
 
equivalents,
 
and
 
certain
interest bearing investments classified within prepaid expenses and other current
 
assets and other assets.
 
Mark-to-market.
The act of determining a value for
 
financial instruments, commodity contracts, and
 
related assets or liabilities based
on the current market price for that item.
 
 
39
Net
 
mark-to-market
 
valuation of
 
certain
 
commodity
 
positions.
Realized
 
and
 
unrealized
 
gains
 
and
 
losses on
 
derivative
 
contracts
that will be allocated to segment operating profit when the exposure we are hedging
 
affects earnings.
Net price realization.
The impact of list and promoted price changes, net of trade and other price
 
promotion costs.
Net realizable
 
value.
The estimated
 
selling price
 
in the
 
ordinary course
 
of business,
 
less reasonably
 
predictable costs
 
of completion,
disposal, and transportation.
 
Noncontrolling interests.
Interests of subsidiaries held by third parties.
 
Notional
 
amount.
The
 
amount
 
of
 
a
 
position
 
or
 
an
 
agreed
 
upon
 
amount
 
in
 
a
 
derivative
 
contract
 
on
 
which
 
the
 
value
 
of
 
financial
instruments are calculated.
OCI.
Other Comprehensive Income.
 
Organic net sales growth
. Net sales growth adjusted
 
for foreign currency translation,
 
acquisitions, divestitures and a
 
53
rd
 
fiscal week,
when applicable.
Project-related costs.
Costs incurred related to our restructuring initiatives not included in restructuring
 
charges.
Reporting unit
. An operating segment or a business one level below an operating
 
segment.
SOFR.
 
Secured Overnight Financing Rate.
Strategic
 
Revenue
 
Management
 
(SRM).
 
A
 
company-wide
 
capability
 
focused
 
on
 
generating
 
sustainable
 
benefits
 
from
 
net
 
price
realization
 
and
 
mix
 
by
 
identifying
 
and
 
executing
 
against
 
specific
 
opportunities
 
to
 
apply
 
tools
 
including
 
pricing,
 
sizing,
 
mix
management, and promotion optimization across each of our businesses.
Supply chain
 
input costs.
 
Costs incurred
 
to produce
 
and deliver
 
product,
 
including costs
 
for
 
ingredients
 
and
 
conversion, inventory
management, logistics, and warehousing.
Translation
 
adjustments.
The impact
 
of the conversion
 
of our foreign
 
affiliates’ financial
 
statements to United
 
States dollars
 
for the
purpose of consolidating our financial statements.
Working capital
. Current assets and current liabilities, all as of the last day of our fiscal year.
 
 
 
 
 
 
 
 
 
 
40
CAUTIONARY STATEMENT
 
RELEVANT
 
TO FORWARD
 
-LOOKING INFORMATION
 
FOR THE PURPOSE OF “SAFE
HARBOR” PROVISIONS OF THE PRIVATE
 
SECURITIES LITIGATION
 
REFORM ACT OF 1995
This report
 
contains or
 
incorporates by
 
reference
 
forward-looking
 
statements within
 
the meaning
 
of the
 
Private Securities
 
Litigation
Reform Act
 
of 1995
 
that are
 
based on
 
our current
 
expectations and
 
assumptions. We
 
also may
 
make written
 
or oral
 
forward-looking
statements,
 
including
 
statements
 
contained
 
in
 
our
 
filings
 
with
 
the
 
Securities
 
and
 
Exchange
 
Commission
 
and
 
in
 
our
 
reports
 
to
stockholders.
The words or
 
phrases “will likely
 
result,” “are expected
 
to,” “will continue,”
 
“is anticipated,” “estimate,”
 
“plan,” “project,” or
 
similar
expressions identify
 
“forward-looking statements”
 
within the
 
meaning of
 
the Private
 
Securities Litigation
 
Reform Act
 
of 1995.
 
Such
statements are
 
subject to
 
certain risks
 
and uncertainties
 
that could
 
cause actual
 
results to
 
differ
 
materially from
 
historical results
 
and
those currently anticipated or projected. We
 
caution you not to place undue reliance on any such forward-looking statements.
In connection
 
with the “safe
 
harbor” provisions
 
of the Private
 
Securities Litigation
 
Reform Act of
 
1995, we are
 
identifying important
factors
 
that could
 
affect
 
our financial
 
performance
 
and could
 
cause our
 
actual results
 
in future
 
periods
 
to differ
 
materially
 
from any
current opinions or statements.
Our
 
future
 
results
 
could
 
be
 
affected
 
by
 
a
 
variety
 
of
 
factors,
 
such
 
as:
 
disruptions
 
or
 
inefficiencies
 
in
 
the
 
supply
 
chain;
 
competitive
dynamics in the consumer foods
 
industry and the markets for
 
our products, including new product
 
introductions, advertising activities,
pricing actions, and promotional
 
activities of our competitors;
 
economic conditions, including
 
changes in inflation rates,
 
interest rates,
tax
 
rates,
 
or
 
the
 
availability
 
of
 
capital;
 
product
 
development
 
and
 
innovation;
 
consumer
 
acceptance
 
of
 
new
 
products
 
and
 
product
improvements;
 
consumer
 
reaction
 
to
 
pricing
 
actions
 
and
 
changes
 
in
 
promotion
 
levels;
 
acquisitions
 
or
 
dispositions
 
of
 
businesses
 
or
assets; changes in capital structure;
 
changes in the legal and regulatory
 
environment, including tax legislation, labeling
 
and advertising
regulations, and litigation; impairments in the carrying
 
value of goodwill, other intangible assets, or other long
 
-lived assets, or changes
in the
 
useful lives
 
of other
 
intangible assets;
 
changes in
 
accounting standards
 
and the impact
 
of critical
 
accounting estimates;
 
product
quality
 
and
 
safety
 
issues,
 
including
 
recalls
 
and
 
product
 
liability;
 
changes
 
in
 
consumer
 
demand
 
for
 
our
 
products;
 
effectiveness
 
of
advertising,
 
marketing,
 
and
 
promotional
 
programs;
 
changes
 
in
 
consumer
 
behavior,
 
trends,
 
and
 
preferences,
 
including
 
weight
 
loss
trends; consumer perception
 
of health-related issues,
 
including obesity; consolidation
 
in the retail environment;
 
changes in purchasing
and
 
inventory
 
levels
 
of
 
significant
 
customers;
 
fluctuations
 
in
 
the
 
cost
 
and
 
availability
 
of
 
supply
 
chain
 
resources,
 
including
 
raw
materials,
 
packaging,
 
energy,
 
and
 
transportation;
 
effectiveness
 
of
 
restructuring
 
and
 
cost
 
saving
 
initiatives;
 
volatility
 
in
 
the
 
market
value of
 
derivatives used to
 
manage price
 
risk for certain
 
commodities; benefit
 
plan expenses due
 
to changes
 
in plan asset
 
values and
discount rates used to determine plan liabilities; failure or
 
breach of our information technology systems; foreign
 
economic conditions,
including currency rate fluctuations; and political unrest in foreign markets
 
and economic uncertainty due to terrorism or war.
You
 
should also
 
consider the risk
 
factors that we
 
identify in Item
 
1A of Part
 
I of our
 
Annual Report on
 
Form 10-K for
 
the fiscal year
ended May 28, 2023, which could also affect our future results.
We undertake
 
no obligation to publicly revise any forward-looking
 
statements to reflect events or circumstances
 
after the date of those
statements or to reflect the occurrence of anticipated or unanticipated events.
Item 3.
 
Quantitative and Qualitative Disclosures About Market Risk.
 
The
 
estimated
 
maximum
 
potential
 
value-at-risk
 
arising
 
from
 
a
 
one-day
 
loss
 
in
 
fair
 
value
 
for
 
our
 
interest
 
rate,
 
foreign
 
exchange,
commodity, and equity
 
market-risk-sensitive instruments outstanding as of February 25, 2024,
 
was as follows:
 
In Millions
One-day Risk
of Loss
Change During
Nine-Month
Period Ended
Feb. 25, 2024
Analysis of Change
Interest rate instruments
$
55
$
(11)
Lower interest rate volatility
Foreign currency instruments
26
(11)
Net price stability in portfolio
Commodity instruments
5
(3)
Decrease in commodity prices
Equity instruments
2
(1)
Immaterial
For additional information, see Item 7A of Part II of our Annual Report on Form 10-K
 
for the fiscal year ended May 28, 2023.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
41
Item 4.
 
Controls and Procedures.
 
We,
 
under the
 
supervision and
 
with the
 
participation of
 
our management,
 
including our
 
Chief Executive
 
Officer and
 
Chief Financial
Officer,
 
have
 
evaluated
 
the
 
effectiveness
 
of
 
the design
 
and
 
operation
 
of
 
our
 
disclosure
 
controls
 
and
 
procedures
 
(as
 
defined
 
in
 
Rule
13a-15(e)
 
under
 
the
 
Securities
 
Exchange
 
Act
 
of
 
1934).
 
Based
 
on
 
our
 
evaluation,
 
our
 
Chief
 
Executive
 
Officer
 
and
 
Chief
 
Financial
Officer have concluded
 
that, as of February
 
25, 2024, our disclosure
 
controls and procedures were
 
effective to ensure
 
that information
required to
 
be disclosed
 
by us
 
in reports
 
that we file
 
or submit
 
under the
 
Securities Exchange
 
Act of
 
1934 is (1)
 
recorded, processed,
summarized,
 
and
 
reported
 
within
 
the
 
time
 
periods
 
specified
 
in
 
Securities
 
and
 
Exchange
 
Commission
 
rules
 
and
 
forms,
 
and
 
(2)
accumulated and
 
communicated to
 
our management,
 
including our
 
Chief Executive
 
Officer and
 
Chief Financial
 
Officer,
 
in a
 
manner
that allows timely decisions regarding required disclosure.
There were no changes in our internal
 
control over financial reporting (as defined
 
in Rule 13a-15(f) under the Securities Exchange
 
Act
of 1934) during the quarter
 
ended February 25, 2024, that
 
materially affected, or are
 
reasonably likely to materially
 
affect, our internal
control over financial reporting.
PART
 
II.
 
OTHER INFORMATION
Item 2.
 
Unregistered Sales of Equity Securities and Use of Proceeds.
 
The
 
following
 
table
 
sets forth
 
information
 
with
 
respect
 
to
 
shares
 
of
 
our
 
common
 
stock
 
that we
 
purchased
 
during
 
the quarter
 
ended
February 25, 2024:
Period
Total
 
Number
 
of Shares
Purchased (a)
Average
Price Paid
Per Share
Total
 
Number of Shares
Purchased as Part of a Publicly
Announced Program (b)
Maximum Number of Shares
that may yet be Purchased
Under the Program (b)
November 27, 2023 -
December 31, 2023
2,167,357
$
65.65
2,167,357
63,863,833
January 1, 2024 -
January 28, 2024
1,794,160
64.76
1,794,160
62,069,673
January 29, 2024 -
 
February 25, 2024
685,856
65.03
685,856
61,383,817
Total
4,647,373
$
65.21
4,647,373
61,383,817
(a)
 
The total number
 
of shares purchased
 
includes shares of
 
common stock withheld
 
for the payment
 
of withholding taxes
 
upon the distribution
 
of
deferred option units.
(b)
 
On June
 
27, 2022,
 
our Board
 
of Directors approved
 
an authorization
 
for the
 
repurchase of
 
up to
 
100,000,000 shares of
 
our common stock
 
and
terminated the
 
prior authorization.
 
Purchases can
 
be made
 
in the
 
open market
 
or in
 
privately negotiated
 
transactions, including
 
the use
 
of call
options
 
and
 
other
 
derivative
 
instruments,
 
Rule
 
10b5-1
 
trading
 
plans,
 
and
 
accelerated
 
repurchase
 
programs.
 
The
 
Board
 
did
 
not
 
specify
 
an
expiration date for the authorization.
Item 5.
 
Other Information.
 
During
 
the
 
fiscal
 
quarter
 
ended
 
February
 
25,
 
2024,
 
no
 
director
 
or
 
officer
 
of
 
the
 
Company
adopted
 
or
terminated
 
a
 
“Rule
 
10b5-1
trading arrangement” or “
non-Rule
10b5-1
 
trading arrangement,” as each term is defined in Item 408(a) of Regulation S-K.
 
42
PART
 
II. OTHER INFORMATION
Item 6.
Exhibits.
 
3.1
 
31.1
 
31.2
 
32.1
 
32.2
 
101
Financial Statements
 
from the
 
Quarterly Report
 
on Form
 
10-Q of
 
the Company
 
for the
 
quarter ended
 
February 25,
2024,
 
formatted
 
in
 
Inline
 
Extensible
 
Business
 
Reporting
 
Language:
 
(i)
 
Consolidated
 
Statements
 
of
 
Earnings;
 
(ii)
Consolidated
 
Statements
 
of
 
Comprehensive
 
Income,
 
(iii)
 
Consolidated
 
Balance
 
Sheets;
 
(iv)
 
Consolidated
Statements of
 
Total
 
Equity; (v)
 
Consolidated Statements
 
of Cash
 
Flows; and
 
(vi) Notes
 
to Consolidated
 
Financial
Statements.
 
104
Cover Page, formatted in Inline Extensible Business Reporting Language
 
and contained in Exhibit 101.
 
 
 
43
SIGNATURES
Pursuant
 
to
 
the
 
requirements
 
of
 
the
 
Securities
 
Exchange
 
Act
 
of
 
1934,
 
the
 
registrant
 
has
 
duly
 
caused
 
this
 
report
 
to
 
be
 
signed
 
on
 
its
behalf by the undersigned thereunto duly authorized.
 
GENERAL MILLS, INC.
(Registrant)
Date: March 20, 2024
/s/ Mark A. Pallot
Mark A. Pallot
Vice President, Chief Accounting
 
Officer
(Principal Accounting Officer and Duly Authorized
 
Officer)