General Mills says it expects its US yogurt business to return to growth in 2014.
Speaking at the Morgan Stanley Global Consumer & Retail Conference in New York, chief financial officer Donal L. Mulligan said: “Unit sales of Yoplait Original have turned positive this quarter driven in part by increased levels of advertising.
“In total, our US yogurt business is stabilizing. Sales in Nielsen measured outlets have been improving sequentially, so we [expect to] see yogurt return to growth in 2014.
Meanwhile, General Mills’ Greek yogurts “continue to significantly outpace this segment”, he claimed, noting that Yoplait Greek 100 generated retail sales of $150m in its first year and continued to grow strongly.
Grain snacks: Retail sales are up almost 10% in fiscal 2014
General Mills’ grain snacks such as Fiber One Lemon Bars, Nature Valley Soft-Baked Oatmeal Squares, and Nature Valley Greek Yogurt Protein bars, were also outperforming the competition, he claimed, while ALT protein bars are now expanding beyond the natural channel into traditional retail outlets.
While acquisitions in the better-for-you snacking space in the US remain attractive, valuations have “ticked up pretty markedly and we want to make sure we find the right property at the right place if we’re going to make a move in that regard”, he said.
Cereals: Product renovation can work just as hard as innovation to drive growth for the cereal category
As for the US cereals aisle, which has not set the world on fire in recent years, there were some bright spots, he said, with new Nature Valley Protein Granola “already among the top turning granola items in a segment that’s growing 17% year-to-date”.
Meanwhile, the successful return of Frute Brute and Yummy Mummy proved that “with the right messaging, product renovation can work just as hard as innovation to drive growth for the cereal category”, he said.
Finally, sales of Lucky Charms are up 9% in the year-to-date.