General Mills : Q4 Press Release

News/Information

Investor Relations

P. O. Box 1113

Minneapolis, MN 55440

FOR IMMEDIATE RELEASE

July 1, 2020

Contact: (analysts) Jeff Siemon: 763-764-2301

(media) Kelsey Roemhildt: 763-764-6364

GENERAL MILLS REPORTS RESULTS FOR FISCAL 2020 AND OUTLINES

FISCAL 2021 PRIORITIES

Fourth Quarter Highlights

• •Net sales increased 21 percent to $5.0 billion and organic net sales¹ were up 16 percent, primarily reflecting a significant increase in at-home food demand driven by the COVID-19 pandemic.

• •Operating profit of $830 million increased 16 percent; constant-currency adjusted operating profit was up 24 percent.

• •Diluted earnings per share (EPS) of $1.02 were up 9 percent; adjusted diluted EPS of $1.10 increased 33 percent in constant currency.

Full Year Highlights

• •Net sales of $17.6 billion increased 5 percent from the prior year; organic net sales were up 4 percent.

• •Operating profit increased 17 percent to $3.0 billion; constant-currency adjusted operating profit was up 7 percent.

• •Diluted EPS of $3.56 were up 23 percent; adjusted diluted EPS of $3.61 increased 12 percent in constant currency.

• •Cash from operations totaled $3.7 billion, up 31 percent; free cash flow of $3.2 billion increased 42 percent. The company beat its fiscal 2020 deleverage target.

¹ Please see Note 7 to the Consolidated Financial Statements below for reconciliation of this and other non-GAAP measures used in this release.

MINNEAPOLIS, Minn.-July 1, 2020-General Mills (NYSE: GIS) today reported results for the fourth quarter

and fiscal year ended May 31, 2020. Fiscal 2020 was a 53-week year, with the extra week falling in the fourth quarter.

"I'mproud of the way our organization has remained focused on serving the needs of our consumers and communities while protecting the health and safety of our employees throughout the COVID-19 pandemic," said General

Mills Chairman and Chief Executive Officer Jeff Harmening. "Amid significant challenge and change inthe world

around us, General Mills adapted and executed in fiscal 2020 to deliver outstanding financial results while fulfilling our

purpose of making food the world loves. We've demonstrated extraordinary agility to meet the unprecedented increase in

demand for food at home and to win across our categories.

"As we turn to fiscal 2021, we'll maintain a sharp focus on the near-term opportunity to meet continued elevated

demand while continuing to advance our long-term strategies by investing to build our brands, strengthen our innovation, and enhance our strategic capabilities. I remain confident that General Mills will emerge from the pandemic a stronger

company."

Responding to COVID-19

The COVID-19 pandemic has had a profound impact on consumer demand acrossthe company'smajor markets, including driving an unprecedented increase in demand for food at home and a corresponding decrease in away-from-home food demand resulting from efforts to reduce virus transmission. The company estimates that at-home food represented approximately 85 percent of its pre-pandemic worldwide net sales and away-from-home food represented the remaining 15 percent.

In the fourth quarter of fiscal 2020, elevated at-home food demand accelerated net sales growth in the North

America Retail segment, where a significant share of net sales comes from categories that were most impacted by at-home eating, including meals, baking, and cereal. The impact of elevated at-home demand was less pronounced in the Europe & Australia segment, reflecting its lower proportion of net sales in those categories. The Pet segment experienced increased demand early in the fourth quarter from stock-up purchasing, which partially unwound by the end of the quarter.

Lower away-from-home food demand reduced growth for the Convenience Stores & Foodservice and Asia & Latin

America segments.

During the global pandemic, General Mills' most important objectivesremain the continued health and safety of

its employees and the ongoing ability to serve consumers around the world. The company has implemented employee safety measures, based on guidance from the CDC and WHO, across all its supply chain facilities, including proper2

hygiene, social distancing, mask use, and temperature screenings. To date, all General Mills manufacturing and

distribution facilities have continued to operate without significant disruption related to COVID-19.

The company has risen to meet the needs of its communities around the world during the pandemic, with a

particular focus on food security. During the fourth quarter, General Mills contributed $10 million in monetary and food

donations to organizations addressing hunger and food access.

In response to changing consumer and customer needs, General Mills has increased its agility and executed with

excellence. The company has partnered with its customers to prioritize production of its most important products to

increase capacity and maintain strong service levels and has adapted content on its food websites to encourage cooking

education and drive stronger E-commerce sales. Additionally, the company has taken actions to reinforce its healthy

liquidity position by refinancing short-term debt, and it has maintained its strong capital discipline, which helped

contribute to a significant increase in free cash flow generation in fiscal 2020.

General Mills is focused on delivering superior execution during the COVID-19 situation while continuing to

invest in its brands and capabilities to ensure it emerges from the pandemic a stronger company in a position to generate

consistent, profitable growth and top-tier returns for its shareholders.

Fourth Quarter Results Summary

• •Net salesof $5.0 billion increased 21 percent versus last year, including 7 points of growth from an extra week ofresults in this year's fourth quarter and a 2-point headwind from unfavorable foreign currency exchange. Organic net sales increased 16 percent, including double-digit growth in organic pound volume and 3 points of favorable organic net price realization and mix. Fourth-quarter net sales growth includes the impact of elevated consumer demand driven by the COVID-19 pandemic.

• •Gross marginincreased 10 basis points to 35.2 percent of net sales. Adjusted gross margin of 36.1 percent was up 80 basis points, primarily driven by Holistic Margin Management (HMM) cost savings and favorable manufacturing leverage, partially offset by increased supply chain costs, including COVID-19-related expenses.

• •Operating profitincreased 16 percent to $830 million. Operating profit marginof 16.5 percent was down 70 basis points. Adjusted operating profit of $888 million increased 24 percent in constant currency, primarily driven by higher net sales, partially offset by higher selling, general, and administrative (SG&A) expenses, including higher administrative and media expenses. Adjusted operating profit margin increased 40 basis points to 17.7 percent.

• •Net earnings attributable to General Millstotaled $626 million, up 10 percent from a year ago.

• •Diluted EPSof $1.02 increased 9 percent. Adjusted diluted EPS of $1.10 were up 33 percent from the prior year in constant currency, primarily reflecting higher adjusted operating profit, higher after-tax earnings from joint ventures, and a lower adjusted effective tax rate, partially offset by higher average diluted shares outstanding.

Full Year Results Summary

• •Net salesincreased 5 percent to $17.6 billion, including 2 points of growth from an extra week of results in this year'sfourth quarter and a 1-point headwind from unfavorable foreign currency exchange. Organic net sales increased 4 percent, reflecting positive organic pound volume and favorable organic net price realization and mix. The company estimates that changes in consumer behavior resulting from COVID-19 increased full-year net sales growth by approximately 3 percentage points.

• •Gross marginincreased 70 basis points to 34.8 percent of net sales. Adjusted gross margin increased 80 basis points to 35.2 percent of net sales, driven primarily by HMM cost savings, favorable net price realization and mix, and lastyear's one-time purchase accounting inventory adjustment related to the Blue Buffalo acquisition, partially offset by input cost inflation and increased supply chain costs related to COVID-19.

• •Operating profitof $3.0 billion increased 17 percent from the prior year. Operating profit marginof 16.8 percent was up 190 basis points. Adjusted operating profit of $3.0 billion increased 7 percent in constant currency, primarily driven by higher net sales, partially offset by higher SG&A expenses, including higher administrative and media expenses. Adjusted operating profit margin increased 40 basis points to 17.3 percent.

• •Net earnings attributable to General Millstotaled $2.2 billion, up 24 percent from the prior year.

• •Diluted EPSof $3.56 increased 23 percent. Adjusted diluted EPS of $3.61 was up 12 percent in constant currency, primarily reflecting higher adjusted operating profit, lower net interest expense, a lower adjusted effective tax rate, higher non-service benefit plan income, and higher after-tax earnings from joint ventures, partially offset by higher average diluted shares outstanding.

Operating Segment Results

Note: Tables may not foot due to rounding.

Components of Fiscal 2020 Reported Net Sales Growth

ForeignReported

Fourth Quarter	Volume	Price/Mix	Exchange	Net Sales
North America Retail	44 pts	(7) pts	--	36%
Pet	44 pts	(7) pts	--	37%
Convenience Stores & Foodservice	(16) pts	(9) pts	--	(24)%
Europe & Australia	11 pts	--	(4) pts	6%
Asia & Latin America	8 pts	(9) pts	(11) pts	(12)%
Total	19 pts	3 pts	(2) pts	21%
Full Year
North America Retail	10 pts	(1) pt	--	8%
Pet	17 pts	2 pts	--	18%
Convenience Stores & Foodservice	(6) pts	(2) pts	--	(8)%
Europe & Australia	--	1 pt	(3) pts	(3)%
Asia & Latin America	(2) pts	(1) pt	(4) pts	(8)%
Total	4 pts	2 pts	(1) pt	5%

Components of Fiscal 2020 Organic Net Sales Growth

Fourth QuarterNorth America Retail Pet

Organic VolumeOrganic Price/Mix

35 pts

(7) pts

44 pts

• (7) pts

  Organic Net Sales28% 37%

  Convenience Stores & Foodservice

  (21) pts

  Europe & Australia Asia & Latin America Total

  4 pts

• (8) pts --

  (29)%

  Foreign Exchange------Acquisitions &

  53rd

  4%

  (4) pts

  1 pt

• (9) pts

• (7)% (11) pts

Divestitures----------

WeekReported Net Sales

9 pts --

36%

37%

• 4 pts

  (24)%

• 7 pts

  6%

• 7 pts

(12)%

12 pts

3 pts

16%

(2) pts

--

7 pts

21%

Full Year

North America Retail Pet

8 pts

(1) pt

17 pts

2 pts

6% 18%

Convenience Stores & Foodservice

(7) pts

(2) pts

(9)%

------

Europe & Australia Asia & Latin America Total

(2) pts

1 pt

• (1)% (3) pts

  (1) pt

  (1) pt

• (2)% (4) pts

--------(3) pts

2 pts --

8%

18%

• 1 pt

  (8)%

• 2 pts

  (3)%

• 2 pts

(8)%

2 pts

2 pts

4%

(1) pt

--

2 pts

5%

Fiscal 2020 Segment Operating Profit Growth

% Change as Reported	% Change in Constant Currency
69%	69%
23%	23%
Convenience Stores & Foodservice	(67)%	(67)%
Europe & Australia	(22)%	(14)%
Asia & Latin America	NM	NM
Total	31%	32%
Full Year
North America Retail	15%	15%
Pet	46%	46%
Convenience Stores & Foodservice	(20)%	(20)%
Europe & Australia	(8)%	(3)%
Asia & Latin America	(74)%	(73)%
Total	10%	11%
North America Retail Segment

Fourth QuarterNorth America Retail Pet

Fourth-quarter net sales for General Mills' North America Retail segmentincreased 36 percent to $3.20 billion, primarily

reflecting increased demand for food at home resulting from the COVID-19 pandemic as well as 9 points of additional sales from the 53rdweek. Organic net sales increased 28 percent, reflecting a strong increase in organic pound volume.

Organic net price realization and mix was unfavorable in the quarter, driven by the mix of sales, including significant growth for heavier products such as refrigerated baked goods, dessert mixes, soup, and flour. Net sales increased across all five operating units, including 75 percent growth in U.S. Meals & Baking, 26 percent growth in U.S. Cereal, 12