Pillsbury Acquisition Cited for Net Earnings Decline

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NEW YORK ( -- General Mills reported disappointing results for the third fiscal quarter, which management blamed on disruptions from the acquisition of Pillsbury last October.

Revenue rose to $3.1 billion from $1.7 billion for the quarter ended Feb. 24, thanks to Pillsbury's sales, but net earnings dropped to $82.5 million from $157.5 million in the year-ago period.

Revenue for the nine months rose to $7.2 billion from $5.3 billion, but net earnings dropped to $401.3 million from $519.1 million.

Results are expected to improve as the Pillsbury transition wraps up in the fall and as new products and promotions help push demand, said General Mills Chairman-CEO Steven Sanger.

General Mills plans a promotional tie-in in April and May between the Go-gurt yogurt brand and the upcoming film Star Wars II: Attack of the Clones.

New products in the pipeline for spring include Nouriche, a new yogurt beverage in the Yoplait brand that will be initially rolled out in 30% of U.S. markets in May. Other line extensions include two new varieties of Nature Valley granola bars, Green Giant frozen vegetables and Hamburger Helper meal kits.

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