General Mills: Pet food sales pop but snack demand down
Sales lost forecasts, despite rising demand for the company's Blue Buffalo feed.
The weaker than expected revenue was largely due to a 2% decline in North American retail sales, which includes Annie's branded cheddar bunnies, Chex, Fruit Snacks and Fiber One and Nature Valley brands. bars.
General Mills said that the sale of other supermarket staples, such as cereals, yogurt and baked goods, remained stable during the quarter. But it was not enough to compensate for the weakness of the snacks.
Out of training & # 39; with today's food trends
The company's Fiber One bars "dropped out of step" with today's weight loss and dietary trends in the US, CEO Jeffrey Harmening said during a conference call with analysts.
"We need to get snacks again," said CFO Donal Mulligan, who said the company will ramp up its R&D spending on new products.
"You see us investing behind some really good ideas about bars and snacks," Mulligan said.
The good news for General Mills is selling the company's Blue Buffalo cap Products division is booming, surging 38% from a year ago. Operating profit also increased 82%.
But large food companies in general have been pushed lately. A shift in consumer taste has damaged many of the larger companies, as more people eat and drink healthier foods and drinks.
Kraft Heinz is one of the worst executive stocks of the year, doubling nearly 30% due to concerns about weak demand for its macaroni and cheese and Oscar Mayer meats.
