General Mills Fourth Quarter Profit Lower, Sees Rising Costs

June 25, 2008 11:31 a.m. EST

Minneapolis, MN (AHN) - General Mills reported Tuesday fourth quarter net income of $185.2 million or 53 cents a share, compared to $224.1 million or 62 cents a share the same period a year earlier, representing a 17 percent decrease.

Excluding losses in commodity hedges, General Mills said they would have earned 73 cents a share. Analysts polled by Thomson Financial expected 73 cents a share on the commodity adjusted earnings with revenue of $3.37 billion.

Revenue increased 13 percent to $3.47 billion from $3.06 billion a year earlier.

General Mills said 8 percent of its revenue growth came from increases in their product prices, while 2 percent was from foreign currency translation. Products sales growth accounted for the remaining 3 percent.

Full year earnings for fiscal 2008 were $1.29 billion or $3.71 a share, up 13 percent compared to the $1.14 billion or $3.18 a share in fiscal 2007.

General Mills said they expect a 9 percent increase in supply costs in fiscal 2009, but reiterated last week's earnings forecast of $3.78 to $3.83 a share for the year, assuming no mark to market impact.

Shares of General Mills recently traded lower 55 cents at $61.85