NEW YORK (AP) — General Mills reported better-than-expected sales for its fiscal first quarter on Wednesday, as the maker of Cheerios and Yoplait yogurt benefited from a mix of new products in the U.S. and acquisitions overseas.
Net income fell, however, as the year-ago results were boosted by one-time items, including a tax benefit.
The Minneapolis-based company, whose brands also include Betty Crocker baking mixes and Progresso soups, has been trying to revive its key U.S. business units. In yogurt, for example, General Mills has been scrambling to catch up with the booming popularity of Greek yogurt by rolling out Greek versions of its Yoplait yogurt. In the latest quarter, the company said yogurt sales volume was flat, as gains in its new Greek varieties offset declines in sales of traditional yogurt.
In an interview, CEO Ken Powell said Greek yogurts still only account for about 10 to 15 percent of General Mills' yogurt sales in the U.S., while they make up more than 30 percent of sales for the broader industry nationwide.
The company saw improvement in its cereal unit, however, as a result of higher volumes and pricing. To boost sluggish cereal sales, General Mills has employing new advertising strategies, such as trying to evoke nostalgia among adults for its Lucky Charms cereal.
In the overall U.S. retail business, sales rose 4 percent to $2.58 billion. Along with Yoplait Greek yogurt, the company touted new products such as Honey Nut Cheerios Medley Crunch for helping fuel the sales gain, but overall volume for the unit rose just 1 percent. The rest of the gains came from price increases. The meals division was weak, as the company recently relaunched its Hamburger Helper line as just "Helper," aiming for people who might use the mixes with different meats.
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