General Mills, Inc. 10-K Summary (Fiscal Year Ended May 28, 1995)
Business Context and Reporting Period
This Form 10-K covers the fiscal year ended May 28, 1995. General Mills, Inc. is a leading manufacturer and marketer of consumer food products, including cereals, baking mixes, snacks, and yogurt. The reporting period is characterized by a significant strategic restructuring: the sale of the Gorton's seafood division on May 18, 1995, and the tax-free pro rata distribution of the restaurant business (Darden Restaurants, Inc., including Red Lobster and Olive Garden) to shareholders on May 28, 1995. Consequently, these businesses are treated as discontinued operations, and prior year financial statements have been restated.
Key Financial Metrics
The filing incorporates detailed financial statements by reference to the 1995 Annual Report to Stockholders; specific revenue, profit, and cash flow totals are not explicitly listed in the provided text. However, the following metrics are disclosed:
- Capital Expenditures: $687 million expended over the three fiscal years ended May 28, 1995. Expected capital expenditures for fiscal 1996 are approximately $170 million.
- Research and Development: $59.8 million in fiscal 1995 (compared to $59.1 million in 1994 and $55.7 million in 1993).
- Market Capitalization: Aggregate market value of common stock held by non-affiliates was $8,297.9 million as of July 20, 1995 (based on a closing price of $52.375).
- Share Count: 158,433,123 shares of Common Stock outstanding as of July 20, 1995 (excluding 45,720,209 treasury shares).
- Earnings to Fixed Charges: The ratio for the fiscal year ended May 28, 1995, was 4.10.
- Allowance for Doubtful Accounts: Balance at the end of the period was $4.1 million.
Material Changes Versus Prior Period
The most material change is the divestiture of the Gorton's and Restaurant businesses, which fundamentally alters the Company's operating segments. Reporting of industry segment information was discontinued as of May 28, 1995. Additionally, the Company implemented changes in the method of accounting for investments in debt and equity securities in fiscal 1995. The Company also introduced several new products, including REESE'S PEANUT BUTTER PUFFS, SUN CRUNCHERS, and the DINNER SENSATIONS line.
Outlook, Risks, and Contingencies
Outlook: Management expects to spend approximately $170 million on capital expenditures in fiscal 1996. The Company continues to focus on new product development and process improvements.
Risks and Contingencies:
- Commodity Prices: The Company relies on raw materials such as cereal grains, sugar, and vegetable oils. While the Company hedges against price movements for grains and oils using futures and options, sugar is not hedged due to a lack of viable derivative markets.
- Environmental Matters: The Company is involved in proceedings regarding 11 sites with potential hazardous substance releases. Management concludes that the probable aggregate exposure is not material to capital expenditures, earnings, or competitive position.
- Legal Proceedings: Management believes there are no pending claims or litigation that could have a significant effect on the consolidated financial position.
Investor Verification Checklist
- Verify the specific revenue and net income figures for fiscal 1995 in the 1995 Annual Report to Stockholders (incorporated by reference), as they are not explicitly stated in this 10-K text.
- Review the "Discontinued Operations" section in the Annual Report to understand the financial impact of the Gorton's sale and Darden distribution.
- Confirm the details of the joint ventures (Cereal Partners Worldwide, Snack Ventures Europe, and International Dessert Partners) and their respective equity interests (50%, 40.5%, and 50%).
- Monitor the status of the 11 environmental sites to ensure the "not material" assessment remains valid.
- Check the 1995 Annual Report for the full breakdown of the $687 million capital expenditures over the three-year period.