General Mills Expects Elevated Demand to Continue - The Wall Street Journal

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General Mills, the maker of Cheerios cereal and other products, said comparable sales rose 16%... — General Mills, the maker of Cheerios cereal and other products, said comparable sales rose 16% in its latest quarter.
Photo: Reuters

July 1, 2020 8:03 am ET

General Mills Inc. said it expects higher demand for its products amid the Covid-19 pandemic and an economic recession to continue.

The maker of Cheerios cereal, Häagen-Dazs ice cream, Nature Valley granola bars and other products on Wednesday said sales surged in its biggest markets during its latest quarter as consumers stocked up during the coronavirus-related lockdowns

General Mills reported $5.02 billion in sales for the quarter ended May 31, up from $4.16 billion a year earlier and ahead of the $4.99 billion that analysts predicted. Comparable sales rose 16% in the quarter.

In the U.S. and Canada, General Mills reported significant growth across several product lines, including refrigerated baked goods, soups and flour. Sales jumped 75% for its meals and baking business in the U.S. and 26% for cereals. Comparable sales for the business increased 28%, the company said, and totaled $3.2 billion.

“The company expects consumer concerns about Covid-19 virus transmission and the recession to drive elevated demand for food at home, relative to pre-pandemic levels,” it said.

General Mills said it is tracking the possibility of a second-wave outbreak, the availability of a vaccine, consumer confidence and other factors to assess the likely magnitude and duration of the stronger demand.

Food manufacturers have gained ground as consumers began filling up their pantries and refrigerators this spring as the pandemic intensified and officials across the country advised consumers to stay at home. Restaurants were decimated after chains and independent locations alike closed dining rooms to comply with social-distancing measures.