BOSTON — After a tough fiscal 2024, General Mills, Inc. expects to return to a growth path amid a steadier operating environment and heightened brand investment to boost its competitiveness.

At the Barclays Global Consumer Staples Conference in Boston, General Mills reaffirmed its fiscal 2025 financial guidance, and top executives expressed confidence in achieving the Minneapolis-based food giant’s long-term target of 2% to 3% top-line growth.

“What gives me confidence we can do that is, if you look before the pandemic, our categories were growing in the 2% to 3% range, and we have regained momentum in most of our categories,” Jeffrey Harmening, chairman and chief executive officer, said in a fireside chat at the Barclays event on Sept. 5.

“So, they’re actually back to growth,” he said. “In fact, the (General Mills) North America Retail categories are at about the 1% growth range. So, they’re back to about where they were before the pandemic. And we certainly believe that we are approaching a space where the category growth is what it was before the pandemic.”

General Mills projects fiscal 2025 organic net sales to range between flat and up 1%, with adjusted operating profit down 2% to flat in constant currency. Adjusted earnings per diluted share are forecast at down 1% to up 1% in constant currency.

“We’re confident that we can at least hold our share in our current categories, because we’ve done it like five out of the last six years,” Harmening said. “By the way, we exceeded the 2% to 3% (top-line growth target) over the last three- and five-year periods. Importantly during that period, and even before the pandemic, we were holding or gaining share in at least 50% of our categories.”

Progress in fiscal 2025

General Mills is scheduled to report 2025 first-quarter results on Sept. 18. For the 2024 fiscal year ended May 26, net earnings declined 4% to $2.5 billion, equal to $4.34 per share on the common stock, from $2.59 billion, or $4.36 per share, in fiscal 2023. Adjusted net EPS was $4.52 per share versus $4.30 in the previous year. Net sales dipped 1% to $19.86 billion. Operating income was flat at $3.43 billion.

The core North America Retail business tallied fiscal 2024 net sales of $12.47 billion, down 1% from a year ago. Net sales fell by low single digits for the US Meals & Baking Solutions, US Snacks and US Morning Foods operating units but grew by mid-single digits in Canada.

Dana McNabb, group vice president for North America Retail, said General Mills is “seeing progress” so far in fiscal 2025.

“We’re really encouraged by the gradual improvement that we’re seeing in pounds (unit volume),” McNabb said. “If you look at our categories over the last three months, what we’re seeing for the period ending August is that pounds are up in our categories (by) 1%. That is an improvement of over 3.5 points versus this time last year and an improvement versus last quarter. It’s pretty much back to historical levels.

“And there are a lot of reasons for that. We’re through some of those big comps now, the pricing, the pantry destocking, the SNAP benefits (reduction). We’re also seeing a bit of an uptick in in-home food consumption, from about 86% to 87%. When you think about the fact that eating away from home is four times more expensive, that’s a little bit more than inflation. So when we look at the macro benefits, we believe that we will continue to see a gradual improvement in pounds.”

Harmening and McNabb pointed to General Mills’ roster of billion-dollar brands — including Cheerios, Betty Crocker, Pillsbury, Nature Valley, Old El Paso, Häagen-Daz, Yoplait, Blue Buffalo and, most recently, Totino’s — and stepped-up marketing investment as the main source of their optimism.

“First, we have leading brands in our categories; we have 9 billion-dollar brands,” Harmening said. “Second, we’ve invested quite a bit in marketing through this latest period. Our marketing spend is up about 43% over the last five years. We’ve invested in capabilities to drive growth, not only in strategic revenue management but also in media and evaluating media and online media.”

He added, “We spent a lot of time over the last four or five years working through product supply chain disruptions, inflation, pricing and all the rest. Now we’re back to a period where how you market really counts.”

Though small brands and private label have picked up market share by getting on-shelf availability back to pre-pandemic levels “earlier than we expected,” McNabb said, “there is no question that our (North American Retail) business is bigger and more profitable than it was pre-pandemic.”

Marketing ramp-up

Still, McNabb noted, “we are in a different business cycle now, and that is going to require us to up our game on demand generation.”

A priority will be regaining household penetration, especially among children.

“The way that we’re going to do that is making sure we have the most remarkable total product offering across our mix, better than our competitors,” she said. “And that will mean product news and new products, advertising and communications, in-store execution, better than the rest.”

Brand investment includes campaigns for Big G cereals with National Football League players Travis and Jason Kelce, for Totino’s with comedian Pete Davidson, for Pillsbury with the Pillsbury Doughboy, and for Blue Buffalo and Häagen-Dazs to spotlight premium positioning.

“Thirty percent of our portfolio has got news; that’s double what we had last year,” McNabb said. “We’re looking at new products. Last year, we did about 3.5% of our net sales on new products. We’re bringing that up to 5%.”

Among the taste improvements are flakier Pillsbury biscuits, cheesier Annie’s mac and cheese and fudgier Betty Crocker brownies, along with new offerings like Fruity Cheerios and a limited-edition Häagen-Dazs ice cream stick bar. Also hitting the market are more better-for-you items, such as Old El Paso Carb Advantage Taco Shells, Mott’s Apple Streusel Soft-Baked Bars and broader distribution of reduced-sugar varieties of Parfait-Pro yogurt and Big G cereal brands in school foodservice. New convenience offerings include Totino’s Breakfast Snack Bites and Nature Valley’s Soft-Baked Breakfast Bar.

In snacks, the North America Retail unit will be rolling out double the price-pack architecture of last year, including smaller sizes at a lower price point and larger packs offering more value.