In a press release this morning, General Mills (NYSE:GIS) provided a positive update to its outlook, forecasting improved sales and other metrics even after people stop stocking up for COVID-19 lockdown. The news comes in advance of a virtual presentation by CEO Jeff Harmening on May 13 at the BMO Global Farm to Market Conference.
The company's fiscal 2020 is almost over, with the fourth quarter ending on May 31. Today, it released preliminary predictions for better than anticipated growth for the entire fiscal year. The gains it expects include a 6% to 8% rise in adjusted diluted earnings per share (EPS), 4% to 6% net operating profit, and an upward nudge of 1% to 2% to organic net sales year over year.
Part of the boost, according to the press release, comes from strong sales during March and April as people bought groceries, and particularly packaged foods, to stock their pantries for the pandemic. However, General Mills also projects demand will remain higher than before the coronavirus outbreak, and stay somewhat elevated moving forward.
The company also provided an operational update, noting COVID-19 hasn't managed to interrupt either production or distribution of General Mills' food products so far. It attributes this to the health and safety countermeasures in place at its facilities, including social distancing and temperature checks.
The pandemic reduced the company's sales of away-from-home food, including purchases of General Mills products by restaurants, but those only represent 15% of its business. CEO Harmening remarked recent quarters saw "consumers embracing food at home like never before," boosting demand where the enterprise is already focused.