Multinational food industry leader General Mills Inc. (GIS) is slated to report its most recent fiscal 2017 third-quarter earnings results Tuesday before market open.

Shares of the Golden Valley, Minn.-based food manufacturer hit a record high this year, trading flat year over year (YOY) and falling significantly from highs in July 2016.

General Mills stock has proven volatile on earnings results in the past. Over the past three quarters, the food giant has posted positive earnings surprises, after quarterly results in the fiscal third quarter of 2016 failed to meet estimates.

Continued Weakness in U.S.

Analyst foresee General Mills earnings coming in at $0.71 per share in the most recent quarter, compared to year-ago non-GAAPearnings per share (EPS) of $0.65. On average, the Street forecasts quarterly revenues of $3.82 billion in Q3, reflecting a 4.6% decline from fiscal-year 2016 third-quarter sales of $4 billion.

This quarter will be particularly telling for the firm as it joins its major food competitors such as Kellogg Co. (K) and Kraft Heinz Co. (KHC) in the struggle to transform in the U.S. retail segment. Despite posting a Q4 beat, Kraft Heinz saw its stock fall as sales fell 3.8% YOY. Similarly, while cereal maker Kellogg posted quarterly earnings that surpassed estimates, net sales declined 1.4% over the same period last year.


General Mills, which generates about 60% of its sales in its home market, saw its U.S. retail sales dip 8.3% in the first half of fiscal 2017. The company has attributed its troubles at home to a weakened demand coming from changing consumer preferences. Further hindering General Mills’ growth prospects are continued issues in promotional activities regarding the firms declining yogurt and soup categories. (See also: General Mills’ VC Arm Banks on Protein Bar Startup.)

To offset a top-line growth slowdown, General Mills will be focusing on restructuring in order to keep costs down and innovating with new products. The firm has indicated it is on track to deliver $1.2 billion in costs-of-goods savings from its Holistic Margin Management program and $500 million in savings from its incremental efficiency and cost savings initiatives between fiscal 2017 and fiscal 2017. (See also: General Mills to Commercialize Eco-Friendly Grain.)


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