General Mills (NYSE: GIS) reported Q4 EPS of $0.91, $0.07 better than the analyst estimate of $0.84. Revenue for the quarter came in at $4.5 billion versus the consensus estimate of $4.36 billion.

Fiscal 2022 Outlook:

General Mills expects the largest factors impacting its performance in fiscal 2022 will be relative balance of at-home versus away-from-home consumer food demand and the inflationary cost environment, both of which remain uncertain. The company expects at-home food demand will decline year over year in fiscal 2022 across most of its core markets, though will remain above pre-pandemic levels. Conversely, away-from-home food demand is expected to continue to recover in fiscal 2022, though not fully to pre-pandemic levels. With roughly 85 percent of the company’s net sales representing at-home food occasions, these dynamics are expected to result in lower aggregate consumer demand in the company’s categories in fiscal 2022 compared to fiscal 2021 levels.

Total input cost inflation is currently expected to be approximately 7 percent of cost of goods sold in fiscal 2022. The company is addressing the inflationary environment with strong HMM cost savings expected to total roughly 4 percent of cost of goods sold and with positive net price realization generated through its Strategic Revenue Management capability, including pricing actions the company has already announced across most of its portfolio.

With these assumptions in mind, General Mills outlined its key full-year fiscal 2022 targets:

• Organic net sales are expected to decline 1 to 3 percent, reflecting the outlook for lower consumer demand.
• Constant-currency adjusted operating profit is expected to decline 2 to 4 percent from the base of $3.2 billion reported in fiscal 2021.
• Constant-currency adjusted diluted EPS are expected to range between flat and down 2 percent from the base of $3.79 earned in fiscal 2021.
• Relative to pre-pandemic levels in fiscal 2019, the midpoints of these fiscal 2022 guidance ranges equate to 3-year compound annual growth rates of approximately 2 percent for organic net sales, 2 percent for constant-currency adjusted operating profit, and 5 percent for constant-currency adjusted diluted EPS.
• Free cash flow conversion is expected to be approximately 95 percent of adjusted after-tax earnings.
• The above targets exclude any impact from recent acquisition and divestiture transactions that have not yet closed.

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