General Mills (NYSE: GIS) reported Q2 EPS of $0.85, $0.01 worse than the analyst estimate of $0.86. Revenue for the quarter came in at $4.1 billion versus the consensus estimate of $4.23 billion.

Although we posted disappointing net sales performance in the second quarter, we delivered good growth in adjusted diluted EPS, driven by significant expansion in our adjusted operating profit margin," said General Mills Chairman and Chief Executive Officer Ken Powell. "Our organic sales declines reflect the actions we've taken to optimize our spending and prioritize profitable volume, as well as weakening food-industry trends in the U.S. We're making targeted adjustments to our plans in the second half to improve our topline performance while still delivering our margin expansion and EPS growth commitments. We remain confident that our strategy of investing behind Consumer First ideas – while driving strong margin expansion – will generate long-term sustainable growth, robust cash flow, and top-tier returns for our shareholders."

Outlook

General Mills updated its key full-year fiscal 2017 targets as follows:

• Organic net sales growth is now expected to decline between 3 and 4 percent, below the previous range of flat to down 2 percent.
• Constant-currency total segment operating profit is now expected to increase 2 to 4 percent, reduced from previous guidance of 6 to 8 percent growth due to lower sales expectations.
• The company is maintaining its targets for adjusted operating profit margin expansion of approximately 150 basis points and constant-currency adjusted diluted EPS growth of 6 to 8 percent from the base of $2.92 earned in fiscal 2016. The adjusted effective tax rate is now expected to finish approximately in line with the year-ago rate of 29.8 percent, and average diluted shares outstanding are now expected to decline 2 percent for the full year; these estimates are changes from previous guidance of a 100 basis point increase and a 1 to 2 percent reduction, respectively.
• Currency translation is now expected to reduce full-year adjusted diluted EPS by 1 cent in 2017.
• The company now expects free cash flow to increase at a high single-digit rate, up from previous guidance of mid single-digit growth driven by accelerated progress on core working capital management.

For earnings history and earnings-related data on General Mills (GIS) click here.