One of the best ways to get insight into a company's operation is to listen to management on a conference call. It's one of the few times investors can hear directly from a CEO about how business is going, where challenges lie, and what they're doing to adapt and grow.  

In the case of General Mills, (NYSE:GIS) it's a chance to tell investors why revenue is down and what they're doing to right the ship. Here were my biggest takeaways from the fiscal third quarter conference call.

Currency is a big drag on results

"Net sales totaled $4.4 billion, down 1% due to foreign currency effects. On a constant-currency basis, we posted 3% growth in net sales. Segment operating profit totaled $698 million, up 1% as reported and up 3% in constant currency. Net earnings decreased 16% to $343 million, and diluted earnings per share were $0.56 as reported." - Don Mulligan, CFO

This quote lays out the challenge for General Mills at the moment. Sales are down, driven by a strong dollar, and net income is falling due, in part, to restructuring and commodity hedge losses.

On an adjusted basis, earnings per share were up 15% from a year ago, but major cost cuts and share buybacks drove that. General Mills is still generating a lot of cash from selling consumer staples like Cheerios and Yoplait, but it's not growing at a significant rate and that has to be a concern for investors long-term.

International sales are a bright spot

"In Latin America, net sales increased 20% driven by inflation-linked pricing in Argentina and Venezuela. Sales for the Asia/Pacific region were up 4% led by double-digit growth in the Middle East and India. Net sales in Canada increased 4%, and constant-currency sales in Europe were 3% above last year." - Don Mulligan, CFO

The U.S. market is struggling for General Mills but international sales are doing well. This is partly driven by inflation, but it's also helped by the fact that branded foods are becoming more commonplace items in developing countries, particularly in Latin America. General Mills is able to take advantage of that and develop a distribution network that expands upon its success in the U.S.

Schools are an emerging growth market

"Our Cereal business is growing in schools, too. Last year, participation in school breakfast increased 5% and is up 50% over the past 10 years. Cereal is a key school breakfast offering, and General Mills is the cereal share leader in K-12 schools with our bowl-pack offerings, as it is nutritious, easy to serve and a good value." - Bethany Quam, President of Convenience Stores and Foodservices

Sadly, not enough children in the U.S. get proper nutrition at home, particularly for breakfast. So, schools are taking on some of that responsibility by offering growing breakfast options, which plays right into General Mills' offerings.

In addition to the growth numbers in the quote above, Quam said that 13 million breakfasts are served at K-12 schools each day, so the company is going after a big opportunity.

General Mills is trying to adapt to a changing market

"At CAGNY, we announced that we're embarking on a broad investment plan designed to renovate our Big G portfolio for today's consumers. Gluten-free Cheerios is the first step in this plan. We're taking 88% of the Cheerios franchise, which equates to 11% of the total Cereal category, gluten-free." -Kendall Powell, CEO

One of the challenges for General Mills has been consumers' move to natural, organic, GMO-free, and no gluten products. Smaller food providers have largely taken up this market, leaving General Mills with a slowly shrinking market.

But they're trying to adapt and change products to serve what the market demands. Other product changes include gluten free Cinnamon Chex, removing artificial colors and flavors from kid yogurts, and reducing sugar by 25% in the Yoplait Original line. The hope is that these moves bring the company more in favor with consumers looking for healthier options.

Capital returns to shareholders remain strong

"We paid $750 million in dividends and spent nearly $1.2 billion to repurchase shares thus far this year." - Don Mulligan, CFO

General Mills has completed three quarters in its fiscal year and has returned nearly $2 billion to shareholders so far. That figure alone should make investors consider the stock at a $32 billion valuation.

At the end of the day, General Mills is still a staple in the world's diet and it's creating cash that keeps going into investors' pockets. Sure, there are challenges for General Mills, but if you stick to companies that generate cash consistently and steadily pay it back to investors, you'll have a good chance at beating the market.