General Mills Inc., the maker of Cheerios, Bisquick and Yoplait, fell as much as 4.1 per cent after slow growth in emerging markets and a lingering slump at home forced the company to cut its forecast.
Earnings are now expected to climb in the low-single digits for the fiscal year ending in May, the Minneapolis-based company said today in a statement. That was down from an earlier prediction of high-single digits. Sales, meanwhile, will grow in the low-single digits, compared with a previous projection for mid-single digits.
General Mills blamed “continued weak food-industry trends in the US and slowing growth in key emerging markets” for scaling back its forecast. The company has been trying to revitalize its business with new products, including the Annie’s Inc. organic food line that it agreed to buy for $820 million in September.
The shares dropped as low as $51.10 in New York after the forecast was released, marking the biggest intraday decline since 17 September. General Mills’ stock had been up 6.7 per cent this year through yesterday.
Bloomberg News, edited by ESM
