General Mills, Inc. (NYSE:GIS) Q1 2020 Earnings Conference Call - Final Transcript
Sep 18, 2019 • 08:30 am ET
Thank you. [Operator Instructions] Our first question comes from the line of Andrew Lazar with Barclays. Your line is open. Please proceed.
Hi, good morning, everybody.
Jeffrey L. Harmening
Good morning, Andrew.
I guess first half with organic sales in fiscal 1Q, particularly in the three segments, you talked about a bit below expectations. I guess in order to get back to your own sort of original internal plan for the year. Would you expect that to come from really more a recovery in the international and CS&F segments? Or anticipating North America Retail and Pet need to maybe bear a little bit more of the weight around accelerating than initially planned?
Jeffrey L. Harmening
So, Andrew, the first thing I would say is that we -- we did reiterate guidance for the full year of 1% to 2% growth, and we feel good about that, because as I said, primarily the two things that we're different than what we expected. We're flour index pricing on the flour and retail inventory in Brazil and the retail inventory in Brazil, we think we'll correct itself starting in the second quarter, which leaves the retail flour piece the index pricing on flour really the biggest difference versus expectations.
As we head into the rest of the year, we fully expect without giving guidance on each and every segment, we fully expect that the segments that were below our expectations we'll improve significantly in the second quarter and I would say we've got good momentum on pet and we've got good momentum on North America Retail, which are our most profitable businesses and I don't see any reason why that momentum shouldn't continue into the second quarter as well.
Got it. And that's helpful. I appreciate it. And then just lastly would be, I think in fiscal '19, you had mentioned that about in North America, Retail and maybe this is best for Jon, I think 7 of 10 categories held or gained share. I think this quarter it was 5 of 10. I know that can move around, probably quarter-by-quarter, but anything to read into that, that we need to think about as we go forward through the year? Thanks so much.
Jonathon J. Nudi
Yes, hi, Andrew, I guess, overall, I'd say the short answer is no. We feel really good about the trajectory of our business. At Investor Day, we said we wanted to do three things, one is continue our momentum on the Cereal and we did that in Q1, up 1% we feel really good about that. And then we wanted to improve our performance in Snack Bars and Yogurt, and we were able to accomplish that as well. So again, we feel very much like we are on track again quarter-to-quarter, you have some levels and share, but overall, we feel like we're performing well and are on track for what we expect for the year.
Our next question comes from the line of John Baumgartner with Wells Fargo. The line is open. Please proceed.