Cash-strapped consumers looking for cheap meals helped push food maker General Mills Inc.'s fiscal second-quarter profit 50 percent higher.
The maker of Cheerios, Yoplait yogurt and Totino's Pizza Rolls also boosted its full-year earnings guidance for the second time in three months following the strong quarter.
General Mills has posted several strong quarters as ingredient prices dropped and recession-weary consumers eat at home more often to save money.
"Consumers around the world continue to focus on nutritious, convenient food choices that help them make breakfast, lunch and dinner for their families at good value. Demand for our leading brands remains strong," Chairman and CEO Ken Powell said in a statement Thursday.
General Mills, based in Minneapolis, reported that its earnings climbed to $565.5 million, or $1.66 per share, for the quarter that ended Nov. 29.
Excluding changes to write down the value of some assets, profit was $1.54 per share.
Sales increased 2 percent to $4.08 billion, partly on better cereal and snacks sales.
The results surpassed the expectations of analysts polled by Thomson Reuters, as they forecast a profit of $1.45 per share on sales of $4.07 billion. These estimates usually exclude one-time items.
General Mills continued to draw shoppers to its brand name basics during the quarter, particularly its cereals. Big G cereal revenue climbed 10 percent, with better sales of Chex cereal varieties, Cheerios and Fiber One cereals.
Snacks sales rose 6 percent on improved results from Fiber One and Nature Valley snack bars as well as several fruit snack varieties.
General Mills also posted sales increases in its baking products, Yoplait and Pillsbury units.
The company boosted its ad spending by 37 percent during the quarter as it tries to keep shoppers aware of its products during difficult economic times. It plans to put more money into advertising during the second half of the year to try to build on its brands' gains, Powell said.
The food maker, which lifted its quarterly dividend on Monday, raised its fiscal 2010 adjusted profit outlook to a range of $4.52 to $4.57 per share. Its previous forecast for adjusted earnings of $4.40 to $4.45 per share had been announced in September and was an increase from a prior guidance of $4.20 to $4.25 per share.
Analysts predict a profit of $4.52 per share for the year.
(Copyright 2009 by The Associated Press. All Rights Reserved.)