General Mills (NYSE:GIS) reported its second-quarter results for the fiscal year 2025, showing a 7 percent decrease in net sales to $4.9 billion.
This decline includes a 6-point headwind from the impact of divestitures and acquisitions, as well as an unfavorable timing comparison with trade expenses from fiscal 2025.
Organic net sales were down 1 percent, driven by unfavorable organic net price realization and mix.
Gross margin fell by 210 basis points to 34.8 percent of net sales, primarily due to higher input costs and unfavorable mark-to-market effects.
However, the impact was partially offset by a product mix benefit from the North American yogurt divestitures, which helped to improve gross margin via favorable net price realization and mix.
Adjusted gross margin similarly declined by 150 basis points to 34.8 percent.
Operating profit for the quarter was $728 million, down 32 percent from the previous year, reflecting the impact of lower gross profit dollars and higher restructuring, transformation, impairment, and other exit costs.
Operating profit margin also fell by 560 basis points to 15 percent.
Adjusted operating profit decreased by 20 percent in constant currency, driven primarily by a lower adjusted gross profit.
The adjusted operating profit margin dropped by 290 basis points to 17.4 percent.
Net earnings attributable to General Mills were $413 million, a 48 percent decrease compared to the same period last year.
Diluted earnings per share (EPS) was $0.78, down 45 percent, impacted by lower operating profit, reduced after-tax earnings from joint ventures, and a higher effective tax rate.
However, a reduction in shares outstanding partially offset these declines.
Adjusted diluted EPS stood at $1.10, reflecting a 21 percent drop in constant currency, primarily due to lower adjusted operating profit and a higher effective tax rate.