General Mills Inc. said consumers will continue to see high prices in the grocery aisle as commodity costs soar.The packaged-food company said it expects costs for ingredients, energy and other inputs to grow by 10% to 11% in fiscal 2012, the highest level it's seen in recent years. Those headwinds will be particularly strong in the current quarter, helping to push earnings down on a year-over-year basis, Chief Financial Officer Don Mulligan said in an analyst conference call.
In the latest quarter, earnings rose 51% amid fewer charges, higher pricing and a more favorable product mix.
For the quarter ended May 29, General Mills reported a profit of $320.2 millionup from $211.9 million a year earlier. Excluding mark-to-market impacts and prior-year tax charges related to debt refinancing and the U.S. health-care overhaul, per-share earnings rose to 52 cents from 41 cents.
Revenue increased 3% to $3.63 billion.
Gross margin rose to 37.5% from 36%, thanks to higher prices.
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