General Mills reaffirmed its full-year guidance despite margin pressure, focusing on a $750 million savings program and debt reduction to stabilize performance amid flat organic sales.
General Mills beat expectations for Q1 FY2027 but reported lower sales, EPS, and margins while reaffirming guidance, creating a mixed outlook.
General Mills reported fiscal 2027 first-quarter results that surpassed internal expectations, even as adjusted EPS fell 13% to $0.75 and reported sales declined 3% to $4.4 billion. The company is navigating input-cost inflation at the high end of its 4%-5% forecast while prioritizing debt reduction over share repurchases.
The 13% decline in adjusted EPS was primarily driven by higher input-cost inflation, lower volume, and increased media spending, which weighed on operating margins.
The company is prioritizing debt reduction to reach a target leverage ratio of 3x net debt to adjusted EBITDA, while deprioritizing share repurchases and acquisitions.