(Reuters) – General Mills (NYSE:GIS) beat quarterly sales and profit estimates on Wednesday, boosted by its efforts to reduce prices on some products and improve demand.
The Cheerios maker posted second-quarter sales of $5.24 billion, surpassing analysts’ estimates of $5.14 billion, according to LSEG data.
While packaged food companies have struggled to boost volumes due to last year’s aggressive price hikes to combat rising input costs, General Mills has revived its volumes by implementing sequential price cuts across product categories, from snacks to pet food, winning back customers who had shifted to cheaper private label brands.
Prices decreased by 1 percentage point in the quarter, compared with a 3 percentage point rise a year earlier.
However, the company lowered its annual adjusted profit forecast, citing increased investments, and now expects it to fall in the range of 1% to 3%, compared with the prior range of down 1% to up 1%.
On an adjusted basis, the company reported a profit of $1.40 per share for the quarter ended Nov. 24, beating analysts’ estimates’ of $1.22 per share, according to data compiled by LSEG.
