General Mills 3Q sales fall, weighing on profit

General Mills Inc. on Tuesday reported another sales decline as it faces more competitive pricing and a market that has been shifting demand from processed foods.

The maker of Cheerios cereal, Yoplait yogurt and other packaged foods reported a 1.1 percent drop in third-quarter profit to $357.8 million, or 61 cents per share. Earnings, adjusted for restructuring costs and non-recurring costs, came to 72 cents per share.

The results topped Wall Street expectations. The average estimate of six analysts surveyed by Zacks Investment Research was for earnings of 71 cents per share.

Revenue fell 5.2 percent to $3.79 billion in the period, falling short of Street forecasts. Four analysts surveyed by Zacks expected $3.82 billion.

Sales in North America fell 7 percent to $2.5 billion, the convenience stores and foodservice segment saw a 1 percent drop to $448 million and sales in Europe and Australia fell 3 percent to $424 million. Sales in Asia and Latin America were essentially flat at $421 million.

The Minneapolis-based company cited "gaps in pricing and promotional activity" for the sales decline.

Shares of General Mills Inc. have dropped slightly more than 2 percent since the beginning of the year, while the Standard & Poor's 500 index has risen 6 percent. The stock has decreased 2.5 percent in the last 12 months.