Milling & Baking News - March 27, 2007 - (Page 1)

THE NEWS WEEKLY OF GRAIN-BASED FOODS MARCH 27, 2007 / General Mills income rises 9%; Sanger sees 'better year' for cereal FEATURE Florida bound Baking professionals prepare to travel to Orlando for I.B.I.E. 2007 Story on Page 34 LATE NEWS Ingredient profits rise at ConAgra OMAHA - Operating profit in the Food and Ingredients segment at ConAgra Foods, Inc. increased more than 36% for the third quarter ended Feb. 25. Operating profit of $109.3 million compared with $80.2 million in the previous year's third quarter. Food and Ingredients sales of $851.9 million were nearly 8% higher than $789.8 million in the previous year's third quarter. ConAgra Mills, an operation in the segment, posted Continued on Page 10 Ingredient Week Sponsored by Story on Page 46 MINNEAPOLIS - Higher sales across most of the company's units helped offset rising ingredient costs at General Mills, Inc., spurring the Minneapolis-based maker of Wheaties and Cheerios to a 9% gain in earnings during the third quarter. The one unit that did not post year-over-year sales improvement - Big G cereal - is expected to have a "better year" going forward into fiscal 2008, said Steve Sanger, chairman and chief executive officer. Net income in the third quarter ended Feb. 25 was $268 million, equal to 77c per share on the common stock, up 9% from $246 million, or 69c per share, in the third quarter of fiscal 2006. General Mills posted net sales of $3,054 million in the third quarter, which was 6% higher than the previous year's third quarter. Total segment operating profits of $486 million were up 7% from a year ago. "This was another quarter of broad-based sales growth and margin expansion for the company," Mr. Sanger said. "We're generating a combination of good unit volume gains, favorable mix and supply chain productivity, which is helping to offset input cost inflation. As a result, we have been able to increase our level of consumer marketing investment and also raise our earnings guidance for the year." In the U.S. Retail segment, net sales Continued on Page 14 Millers project soft red winter production up 2% from 2006 SARASOTA, FLA. - Production of soft red winter wheat in 2007 should increase 2% from 2006, with improved forecasts for the mid-Atlantic, Southern, Delta and Southwestern states offsetting expected decreases in outturn in the Central states, the Midwest and Southeast, a panel of grain and milling industry executives told members of the Soft Wheat Milling Committee of the North American Millers' Association during that group's an- nual meeting March 12 in Sarasota. The panel projected the 2007 soft red winter wheat crop at 396,996,000 bus, compared with 390,165,000 bus last year. The projected 2007 outturn was well above the recent five-year (2002-2006) average production of 356 million bus and approached the recent 10-year (1997-2006) average of 402 million bus. It would be the largest soft red winter wheat crop since 399,670,000 million bus in 2001. The panel also forecast Eastern soft white winter wheat production at 17,218,000 bus, down 4,764,000 bus, or 23%, from 2006, and Pacific Northwest soft white wheat production at 197,935,000 bus, up 10,297,000 bus, or 5%, from last year. Grover Van Hoose, grain buyer, The Continued on Page 16

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Milling & Baking News - March 27, 2007