General Mills pet food and treat net sales dropped 20% in the fourth-quarter of fiscal year 2021 to US$444 million, although pet food retail sales in measured channels increased by double-digits during the same period. General Mills executives discussed financial results during an earnings call on June 30.
General Mills pet food and treat net sales decline reflected comparison against results in the previous year when pet owners were stocking up as the ongoing pandemic took hold globally, along with a General Mills fiscal calendar change that added a month to pet results. On a 2-year compound growth basis, which eliminates the effect of the extra month of results in fiscal 2020, fourth-quarter net sales were up 5%. Segment operating profit declined 24% to US$103 million, primarily driven by lower volume and higher input costs, partially offset by lower selling, general and administrative (SG&A) expenses and favorable net price realization and mix. For the full fiscal year, General Mills’ pet segment net sales increased 2% to US$1.73 billion.
On a 2-year compound growth basis, annual net sales were up 10%. Blue Buffalo brand full-year retail sales increased by double digits and increased in market share. General Mills’ pet segment operating profit was US$415 million, up 6 percent, driven by higher net sales and lower SG&A expenses, partially offset by higher input costs.
Finalization of Tyson Foods brands, facility sale to General Mills
In May, Tyson Foods announced the pending sale of its pet treats business to General Mills for approximately US$1.2 billion. The sale included Tyson’s Nudges, True Chews and Top Chews brands, as well as a production facility in Independence, Iowa, USA. Tyson Foods will continue to provide meat ingredients for the pet treats business after General Mills assumes ownership.
“Annual net sales for the Tyson pet treat business totaled more than US$240 million and have grown at nearly a 20% compound rate over the past three years,” Jeff Harmening, General Mills chairman and chief executive officer, said in an earning call on June 30. “We see significant opportunities to drive future growth by expanding awareness and availability of these products and we expect to unlock production and other cost synergies with the rest of our pet business, all of which will result in substantial value creation. We have now cleared nearly all of the key closing conditions for this transaction, including HSR review, so we expect the deal to close shortly.”
General Mills in Top Company’s Database
According to Petfood Industry’s Top Pet Food Companies Current Data, General Mills is a North American manufacturer and marketer of consumer foods and pet food; entering the pet food market in 2018 with the acquisition of Blue Buffalo. Blue Buffalo is manufactured in the U.S. through a hybrid network of owned and contracted facilities. The company's dry formulas include LifeSource Bits, a blend of nutrients and antioxidants.
