Slide 1: Fiscal 2023 Q2 Earnings
Fiscal 2023 Q2 Earnings December 20, 2022 General Mills Second Quarter Fiscal 2023
Slide 2: A Reminder on Forward-looking Statements
A Reminder on Forward-looking Statements This presentation contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 that are based on management’s current expectations and assumptions. These forward-looking statements are subject to certain risks
Slide 3: Jeff Harmening, Chairman and Chief Executive Officer
Jeff Harmening Chairman and Chief Executive Officer General Mills Second Quarter Fiscal 2023 3
Slide 4: Today's Key Messages
Today’s Key Messages • Delivered Strong Results in Q2, Including Second Consecutive Quarter of Gross Margin Expansion • Some Signs of Improvement in Operating Environment, but it Remains Volatile • Executing Well Against our Accelerate Strategy and F23 Priorities • Raising Full-year Guidance on Net
Slide 5: Delivered Strong Performance in Q2
Delivered Strong Performance in Q2 Q2 YTD Organic Net Sales1 + 11% + 11% Adj. Operating Profit2 + 7% + 8% Adj. Diluted EPS2 + 12% + 13% (1) Non-GAAP measure. See appendix for reconciliation General Mills Second Quarter Fiscal 2023 (2) Growth rates in constant currency. Non-GAAP measures. See appendi
Slide 6: Environment Remains Dynamic in F23
Environment Remains Dynamic in F23 Continued Economic Volatility Continued Supply Ongoing High Inflation Chain Disruptions Pandemic Impact General Mills Second Quarter Fiscal 2023 6
Slide 7: Continue to Drive our Accelerate Strategy in F23
Delivering on Our Fiscal 2023 Priorities Continue to Drive our Accelerate Strategy in F23 1 Continue to Compete Effectively 2 Continue to Invest for the Future 3 Continue to Reshape our Portfolio General Mills Second Quarter Fiscal 2023 7
Slide 8: Continuing to Compete Effectively in Q2
Continuing to Compete Effectively in Q2 Growing or Holding Share in Sustained Strength Majority of our Priority Businesses* Across Many Categories General Mills % Priority Business Holding/Growing Share 54% Cereal* Ref. Dough Fruit Snacks 37% (Global) (U.S.) (U.S.) F23 1H F23 1H Hot Snacks Soup Seas
Slide 9: Continuing to Invest for the Future
Continuing to Invest for the Future Investing in Investing in Investing in Brand Building Capabilities Growth Capacity Digital & Media $ Technology Growth Capital +DD in F23 Investment +DD% in F23 +DD% in F23 General Mills Second Quarter Fiscal 2023 9
Slide 10: Standing for Good by Alleviating Hunger
Standing for Good by Alleviating Hunger General Mills has Long History of Acting to Reduce Hunger and Food Insecurity in our Communities Partnership with Food Banks Supported Creation of Nationwide Food Recovery Technology General Mills Second Quarter Fiscal 2023 10
Slide 11: Competing Effectively and Investing in Cereal
Competing Effectively and Investing in Cereal Continued Share Growth Winning Brand Building and Innovation U.S. RTE Cereal +20% Retail Sales Dollar Share vs F181 34.4% 33.8% 33.1% 32.5% 31.7% 31.3% 30.5% F17 F18 F19 F20 F21 F22 F23 1H Source: NielsenIQ xAOC General Mills Second Quarter Fiscal 2023 ¹
Slide 12: Competing Effectively and Investing in Refrigerated Dough
Competing Effectively and Investing in Refrigerated Dough Continued Share Growth Expanding Usage Occasions with Personalized Consumer Messaging U.S. Refrigerated Dough +49% Retail Sales Dollar Share vs F181 73.2% 71.4% 71.9% 70.4% 68.0% 66.7% F18 F19 F20 F21 F22 F23 1H Source: NielsenIQ xAOC General
Slide 13: Competing Effectively and Investing in Fruit Snacks
Competing Effectively and Investing in Fruit Snacks Continued Share Growth Capacity Expansion $100MM Capacity Expansion U.S. Fruit Snacks +67% Retail Sales Online Q1 F23 Dollar Share vs F181 53.7% Expanding in Digital & Physical Channels 50.9% 51.1% 50.1% 49.3% 48.8% E-commerce C-store Retail Sales
Slide 14: Blue Buffalo is Well Positioned for Long-term Growth
Blue Buffalo is Well Positioned for Long-term Growth • Humanization and Premiumization Continue to Drive U.S. Pet Food Category • Blue Buffalo #1 Natural Pet Food Brand¹ #1 Brand Most Likely to Recommend² #1 Brand Pet Parents Willing to Pay More For² #1 Most Loved & Trusted Natural Brand² • St
Slide 15: Pet Retail Sales Significantly Ahead of Net Sales in Q2
Pet Retail Sales Significantly Ahead of Net Sales in Q2; Expect Double-digit Net Sales Growth in 2H Pet Net Sales Drivers in Q2 Keys to 2H Acceleration • Inventory Reduction at Key Retailers • Added External Manufacturing (Retail Sales +HSD*; Net Sales Flat) Capacity on Dry Food & Treats • Ongoing C
Slide 16: Exciting Innovation, Renovation, and Brand Building
Exciting Innovation, Renovation, and Brand Building Wilderness Dry Dog Food Tastefuls Cat Food Treats Innovation & Renovation Portfolio Renovation Masterbrand Advertising General Mills Second Quarter Fiscal 2023 16
Slide 17: Kofi Bruce, Chief Financial Officer
Kofi Bruce Chief Financial Officer General Mills Second Quarter Fiscal 2023 17
Slide 18: Second Quarter Fiscal 2023 Financial Results
Second Quarter Fiscal 2023 Financial Results Q2 TOTAL GENERAL MILLS $MM VS. LY Net Sales $5,221 +4% Organic Net Sales1 +11% Adjusted Operating Profit1 $880 +7%2 Adjusted Diluted EPS1 $1.10 +12%2 (1) Non-GAAP measure. See appendix for reconciliation General Mills Second Quarter Fiscal 2023 (2) Consta
Slide 19: Components of Second Quarter Net Sales Growth
Components of Second Quarter Net Sales Growth Organic Net Sales1 +11% +17 pts +4 pts -1 pt -6 pts -5 pts Organic Organic Foreign Acquisitions & Total Net Sales Volume Price / Mix Exchange Divestitures As Reported (1) Non-GAAP measure General Mills Second Quarter Fiscal 2023 May not foot due to round
Slide 20: Second Quarter Fiscal 2023 North America Retail
Second Quarter Fiscal 2023 North America Retail Segment Results Segment Highlights North America Retail Q2 • Q2 organic net sales growth driven by positive price/mix in response to significant cost inflation Organic Net Sales¹ +13% Segment Op Profit² +24% • Broad-based growth across U.S. Snacks, U.S
Slide 21: Second Quarter Fiscal 2023 Pet
Second Quarter Fiscal 2023 Pet Segment Results Segment Highlights Pet Q2 • Q2 net sales negatively impacted by a reduction in retailer inventory; all-channel retail sales +HSD* Organic Net Sales¹ Flat Segment Op Profit² -34% • Expect acceleration in 2H net sales growth behind improved service, produ
Slide 22: Second Quarter Fiscal 2023 North America Foodservice
Second Quarter Fiscal 2023 North America Foodservice Segment Results Segment Highlights North America Foodservice Q2 • Q2 organic net sales growth driven by positive price/mix, including a 5-point benefit from index Organic Net Sales¹ +17% pricing on bakery flour Segment Op Profit² +20% • Q2 profit
Slide 23: Second Quarter Fiscal 2023 International
Second Quarter Fiscal 2023 International Segment Results Segment Highlights International Q2 • Q2 organic net sales growth driven by Brazil, Distributor markets, and Europe/Australia, partially Organic Net Sales¹ +5% offset by a decline in China due to consumer Segment Op Profit² -68% mobility restr
Slide 24: Second Quarter Fiscal 2023 Joint Ventures
Second Quarter Fiscal 2023 Joint Ventures Q2 AFTER-TAX JV EARNINGS: $25MM, -23% VS. LY Joint Venture Results Q2 Joint Venture Highlights NET SALES¹ Q2 • CPW net sales growth driven by positive price/mix, CPW +2% partially offset by lower volume HDJ -10% • HDJ net sales decline due to lapping strong
Slide 25: Second Quarter Fiscal 2023 Margin Results
Second Quarter Fiscal 2023 Margin Results Adjusted Gross Margin1 Adjusted Operating Profit Margin1 (% OF NET SALES) (% OF NET SALES) 33.2% 16.9% 16.3% 32.2% Q2 F22 Q2 F23 Q2 F22 Q2 F23 • Q2 Adj. Gross Margin increase driven by positive price/mix and HMM cost savings, partially offset by input cost i
Slide 26: Second Quarter Fiscal 2023 Other Income Statement Items
Second Quarter Fiscal 2023 Other Income Statement Items • Adjusted Unallocated Corporate Expenses Increased $30MM • Net Interest Expense Decreased $1MM • Adjusted Effective Tax Rate 21.1% vs. 22.3% LY¹ • Average Diluted Shares Outstanding -2% vs. LY General Mills Second Quarter Fiscal 2023 (1) Non-G
Slide 27: First Half Fiscal 2023 Financial Results
First Half Fiscal 2023 Financial Results 1H TOTAL GENERAL MILLS $MM VS. LY Net Sales $9,938 +4% Organic Net Sales1 +11% Adjusted Operating Profit1 $1,761 +8%2 Adjusted Diluted EPS1 $2.21 +13%2 (1) Non-GAAP measure. See appendix for reconciliation General Mills Second Quarter Fiscal 2023 (2) Constant
Slide 28: First Half Fiscal 2023 Balance Sheet and Cash Flow
First Half Fiscal 2023 Balance Sheet and Cash Flow Operating Cash Flow ($ IN MILLIONS) • Capital Investments = $227MM $1,498 $1,201 • Dividends Paid = $648MM • Net Shares Repurchased = $783MM F22 F23 General Mills Second Quarter Fiscal 2023 28
Slide 29: Raising Fiscal 2023 Financial Outlook
Raising Fiscal 2023 Financial Outlook PREVIOUS UPDATED KEY FINANCIAL METRICS* F23 OUTLOOK F23 OUTLOOK Organic Net Sales Growth +6% to +7% +8% to +9% Adjusted Operating Profit Growth† Flat to +3%1,2 +3% to +5%1,2 Adjusted Diluted EPS Growth† +2% to +5%1,2 +4% to +6%1,2 Free Cash Flow Conversion 90%+
Slide 30: Today's Key Messages
Today’s Key Messages • Delivered Strong Results in Q2, Including Second Consecutive Quarter of Gross Margin Expansion • Some Signs of Improvement in Operating Environment, but it Remains Volatile • Executing Well Against our Accelerate Strategy and F23 Priorities • Raising Full-year Guidance on Net
Slide 31: A Reminder on Non-GAAP Guidance
A Reminder on Non-GAAP Guidance Our fiscal 2023 outlook for organic net sales growth, adjusted operating profit growth, adjusted diluted EPS growth, and free cash flow conversion are non-GAAP financial measures that exclude, or have otherwise been adjusted for, items impacting comparability, includi
Slide 32: Appendix: Q2 Fiscal 2023 North America Retail Operating Results
Appendix: Second Quarter Fiscal 2023 North America Retail Operating Results NET SALES % VS. LY Operating Unit Q2 U.S. Snacks +18% U.S. Meals & Baking Solutions +10% U.S. Morning Foods +10% Canada -3% Canada Constant-currency¹ +4% General Mills Second Quarter Fiscal 2023 (1) Net sales growth in const
Slide 33: Reconciliation of Q2 Fiscal 2023 Canada Constant-Currency Net Sales Growth
Reconciliation of Second Quarter Fiscal 2023 Canada Operating Unit Constant-Currency Net Sales Growth General Mills Second Quarter Fiscal 2023 33
Slide 34: Reconciliation of Q2 Fiscal 2023 Organic Net Sales Growth
Reconciliation of Second Quarter Fiscal 2023 Organic Net Sales Growth General Mills Second Quarter Fiscal 2023 *Table may not foot due to rounding 34
Slide 35: Reconciliation of Q2 Adjusted Operating Profit Constant-currency Growth Rate
Reconciliation of Second Quarter Fiscal 2023 Adjusted Operating Profit Constant-currency Growth Rate (FISCAL YEARS, $ IN MILLIONS) General Mills Second Quarter Fiscal 2023 *Table may not foot due to rounding 35
Slide 36: Reconciliation of Q2 Adjusted Diluted EPS Growth Rates
Reconciliation of Second Quarter Fiscal 2023 Adjusted Diluted EPS and Related Constant-currency Growth Rates (FISCAL YEARS) *Table may not foot due to rounding General Mills Second Quarter Fiscal 2023 **See reconciliation of tax rate items for tax impact of individual items 36
Slide 37: Reconciliation of First Half Fiscal 2023 Organic Net Sales Growth
Reconciliation of First Half Fiscal 2023 Organic Net Sales Growth (FISCAL YEAR) General Mills Second Quarter Fiscal 2023 *Table may not foot due to rounding 37
Slide 38: Reconciliation of First Half Adjusted Operating Profit Constant-currency Growth
Reconciliation of First Half Fiscal 2023 Adjusted Operating Profit Constant-currency Growth Rate (FISCAL YEARS, $ IN MILLIONS) General Mills Second Quarter Fiscal 2023 *Table may not foot due to rounding 38
Slide 39: Reconciliation of First Half Adjusted Diluted EPS Growth Rates
Reconciliation of First Half Fiscal 2023 Adjusted Diluted EPS and Related Constant-currency Growth Rates (FISCAL YEARS) *Table may not foot due to rounding General Mills Second Quarter Fiscal 2023 **See reconciliation of tax rate items for tax impact of individual items 39
Slide 40: Reconciliation of Q2 Constant-currency Segment Operating Profit Growth
Reconciliation of Second Quarter Fiscal 2023 Constant-currency Segment Operating Profit Growth General Mills Second Quarter Fiscal 2023 *Table may not foot due to rounding 40
Slide 41: Reconciliation of Q2 Fiscal 2023 Adjusted Gross Margin
Reconciliation of Second Quarter Fiscal 2023 Adjusted Gross Margin (FISCAL YEARS) General Mills Second Quarter Fiscal 2023 *Table may not foot due to rounding 41
Slide 42: Reconciliation of Q2 Adjusted Operating Profit Margin
Reconciliation of Second Quarter Fiscal 2023 Adjusted Operating Profit Margin (FISCAL YEARS) General Mills Second Quarter Fiscal 2023 *Table may not foot due to rounding 42
Slide 43: Reconciliation of Q2 Fiscal 2023 Adjusted Tax Rates
Reconciliation of Second Quarter Fiscal 2023 Adjusted Tax Rates (FISCAL YEARS, $ IN MILLIONS EXCEPT PER SHARE DATA) *Table may not foot due to rounding General Mills Second Quarter Fiscal 2023 **Earnings before income taxes and after-tax earnings from joint ventures 43
Slide 44: Reconciliation of First Half Fiscal 2022 Adjusted Tax Rates
Reconciliation of First Half Fiscal 2022 Adjusted Tax Rates (FISCAL YEARS, $ IN MILLIONS EXCEPT PER SHARE DATA) *Table may not foot due to rounding General Mills Second Quarter Fiscal 2023 **Earnings before income taxes and after-tax earnings from joint ventures 44