0.10.1100000407042021Q3false--05-302.52022-05-312022-09-170.11754.629/08/202128/05/2023us-gaap:AccountingStandardsUpdate201613Member 0000040704 2020-06-01 2021-02-28 0000040704 2019-05-27 2020-02-23 0000040704 2020-11-30 2021-02-28 0000040704 2019-11-25 2020-02-23 0000040704 2020-05-31 0000040704 2021-02-28 0000040704 us-gaap:PensionPlansDefinedBenefitMember 2020-11-30 2021-02-28 0000040704 us-gaap:PensionPlansDefinedBenefitMember 2019-11-25 2020-02-23 0000040704 us-gaap:OtherPostretirementBenefitPlansDefinedBenefitMember 2019-11-25 2020-02-23 0000040704 us-gaap:OtherPostretirementBenefitPlansDefinedBenefitMember 2020-11-30 2021-02-28 0000040704 us-gaap:OperatingSegmentsMember 2020-11-30 2021-02-28 0000040704 us-gaap:OperatingSegmentsMember 2019-11-25 2020-02-23 0000040704 us-gaap:CorporateNonSegmentMember 2020-11-30 2021-02-28 0000040704 us-gaap:CorporateNonSegmentMember 2019-11-25 2020-02-23 0000040704 us-gaap:NotesPayableToBanksMember 2020-05-31 0000040704 us-gaap:EmployeeStockOptionMember 2019-11-25 2020-02-23 0000040704 us-gaap:RestrictedStockUnitsRSUMember 2019-11-25 2020-02-23 0000040704 us-gaap:EmployeeStockOptionMember 2020-11-30 2021-02-28 0000040704 us-gaap:RestrictedStockUnitsRSUMember 2020-11-30 2021-02-28 0000040704 us-gaap:CommercialPaperMember 2020-05-31 0000040704 us-gaap:CommercialPaperMember 2021-02-28 0000040704 us-gaap:ParentMember 2019-11-25 2020-02-23 0000040704 us-gaap:ParentMember 2020-11-30 2021-02-28 0000040704 us-gaap:NoncontrollingInterestMember 2019-11-25 2020-02-23 0000040704 us-gaap:NoncontrollingInterestMember 2020-11-30 2021-02-28 0000040704 gis:RedeemableInterestsMember 2019-05-27 2020-02-23 0000040704 gis:RedeemableInterestsMember 2020-06-01 2021-02-28 0000040704 us-gaap:RestructuringChargesMember 2019-11-25 2020-02-23 0000040704 us-gaap:CostOfSalesMember 2020-11-30 2021-02-28 0000040704 us-gaap:RestructuringChargesMember 2020-11-30 2021-02-28 0000040704 us-gaap:ParentMember gis:YoplaitSasMember 2021-02-28 0000040704 gis:RedeemableInterestsMember gis:YoplaitSasMember 2021-02-28 0000040704 us-gaap:NoncontrollingInterestMember gis:LiberteMarquesSarlMember 2021-02-28 0000040704 us-gaap:PreferredClassAMember gis:GeneralMillsCerealsLlcMember gis:ThirdPartyInterestHolderMember 2020-06-01 2021-02-28 0000040704 us-gaap:PreferredClassAMember gis:GeneralMillsCerealsLlcMember gis:ThirdPartyInterestHolderMember 2021-02-28 0000040704 gis:RedeemableInterestsMember gis:YoplaitSasMember 2011-07-01 0000040704 gis:RedeemableInterestsMember gis:YoplaitSasMember 2020-06-01 2021-02-28 0000040704 us-gaap:NoncontrollingInterestMember gis:YoplaitMarquesSncAndLiberteMarquesSarlMember 2011-07-01 0000040704 gis:RedeemableInterestsMember gis:YoplaitSasSubsidiaryMember 2020-06-01 2021-02-28 0000040704 2020-02-23 0000040704 us-gaap:RetainedEarningsMember 2019-05-27 2020-02-23 0000040704 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2019-05-27 2020-02-23 0000040704 us-gaap:TreasuryStockMember 2019-05-27 2020-02-23 0000040704 us-gaap:AdditionalPaidInCapitalMember 2019-05-27 2020-02-23 0000040704 us-gaap:NoncontrollingInterestMember 2019-05-27 2020-02-23 0000040704 us-gaap:NoncontrollingInterestMember 2020-06-01 2021-02-28 0000040704 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2020-06-01 2021-02-28 0000040704 us-gaap:RetainedEarningsMember 2020-06-01 2021-02-28 0000040704 us-gaap:AdditionalPaidInCapitalMember 2020-06-01 2021-02-28 0000040704 us-gaap:TreasuryStockMember 2020-06-01 2021-02-28 0000040704 us-gaap:NoncontrollingInterestMember 2020-02-23 0000040704 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2020-02-23 0000040704 us-gaap:RetainedEarningsMember 2020-02-23 0000040704 us-gaap:TreasuryStockMember 2020-02-23 0000040704 us-gaap:AdditionalPaidInCapitalMember 2020-02-23 0000040704 us-gaap:CommonStockMember 2020-02-23 0000040704 us-gaap:NotesPayableToBanksMember 2021-02-28 0000040704 2019-05-27 2019-08-25 0000040704 gis:RedeemableInterestsMember 2021-02-28 0000040704 us-gaap:CostOfSalesMember 2019-11-25 2020-02-23 0000040704 gis:TwoPointTwoPercentFixedRateNoteMember 2020-02-23 0000040704 gis:TwoPointTwoPercentFixedRateNoteMember 2019-11-25 2020-02-23 0000040704 us-gaap:NoncontrollingInterestMember gis:YoplaitMarquesSncMember 2021-02-28 0000040704 gis:LongTermDebtAgreementsContainingRestrictiveCovenantsMember 2020-06-01 2021-02-28 0000040704 gis:ZeroPointFourFiveFixedRateNotesMember 2019-11-25 2020-02-23 0000040704 gis:ZeroPointZeroZeroFixedRateNotesMember 2019-11-25 2020-02-23 0000040704 gis:ZeroPointFourFiveFixedRateNotesMember 2020-02-23 0000040704 gis:ZeroPointZeroZeroFixedRateNotesMember 2020-02-23 0000040704 gis:ZeroPointZeroZeroFixedRateNotes1Member 2020-02-23 0000040704 2021-03-15 0000040704 gis:FloatingRateNotesMember 2019-11-25 2020-02-23 0000040704 gis:ZeroPointZeroZeroFixedRateNotes1Member 2019-11-25 2020-02-23 0000040704 us-gaap:CommonStockMember 2020-06-01 2021-02-28 0000040704 gis:OnePointZeroZeroZeroPercentNotesDue2023Member 2020-06-01 2021-02-28 0000040704 gis:ZeroPointFourFiveZeroPercentNotesDue2026Member 2020-06-01 2021-02-28 0000040704 gis:OnePointFiveZeroZeroPercentNotesDue2027Member 2020-06-01 2021-02-28 0000040704 us-gaap:CommodityContractMember 2021-02-28 0000040704 us-gaap:EnergyRelatedDerivativeMember 2021-02-28 0000040704 gis:AgriculturalRelatedDerivativeMember 2021-02-28 0000040704 us-gaap:CommodityContractMember 2020-06-01 2021-02-28 0000040704 us-gaap:InterestRateSwapMember 2020-06-01 2021-02-28 0000040704 us-gaap:InterestRateSwapMember 2019-11-25 2020-02-23 0000040704 us-gaap:SwapMember 2020-06-01 2021-02-28 0000040704 us-gaap:SwapMember 2019-08-26 2019-11-24 0000040704 us-gaap:SwapMember 2019-11-24 0000040704 us-gaap:InterestRateSwapMember 2020-02-23 0000040704 gis:ZeroPointZeroZeroZeroFixedRateNotes2Member 2020-06-01 2020-08-30 0000040704 gis:TwoPointEightSevenFiveFixedRateNotesMember 2020-02-24 2020-05-31 0000040704 gis:ZeroPointZeroZeroZeroFixedRateNotes2Member 2020-08-30 0000040704 us-gaap:TreasuryLockMember 2020-05-31 0000040704 us-gaap:TreasuryLockMember 2020-02-24 2020-05-31 0000040704 gis:TwoPointEightSevenFiveFixedRateNotesMember 2020-05-31 0000040704 gis:NorthAmericaRetailSegmentMember 2020-05-31 0000040704 gis:PetSegmentMember 2020-05-31 0000040704 gis:ConvenienceStoresAndFoodserviceSegmentMember 2020-05-31 0000040704 gis:EuropeAndAustraliaSegmentMember 2020-05-31 0000040704 gis:AsiaAndLatinAmericaSegmentMember 2020-05-31 0000040704 gis:JointVenturesMember 2020-05-31 0000040704 gis:NorthAmericaRetailSegmentMember 2020-06-01 2021-02-28 0000040704 gis:PetSegmentMember 2020-06-01 2021-02-28 0000040704 gis:ConvenienceStoresAndFoodserviceSegmentMember 2020-06-01 2021-02-28 0000040704 gis:EuropeAndAustraliaSegmentMember 2020-06-01 2021-02-28 0000040704 gis:AsiaAndLatinAmericaSegmentMember 2020-06-01 2021-02-28 0000040704 gis:JointVenturesMember 2020-06-01 2021-02-28 0000040704 gis:NorthAmericaRetailSegmentMember 2021-02-28 0000040704 gis:PetSegmentMember 2021-02-28 0000040704 gis:ConvenienceStoresAndFoodserviceSegmentMember 2021-02-28 0000040704 gis:EuropeAndAustraliaSegmentMember 2021-02-28 0000040704 gis:AsiaAndLatinAmericaSegmentMember 2021-02-28 0000040704 gis:JointVenturesMember 2021-02-28 0000040704 gis:PostemploymentBenefitMember 2020-11-30 2021-02-28 0000040704 gis:PostemploymentBenefitMember 2019-11-25 2020-02-23 0000040704 gis:LineOfCreditExpiringMay2022Member 2021-02-28 0000040704 gis:LineOfCreditExpiringSeptember2022Member 2021-02-28 0000040704 us-gaap:LineOfCreditMember 2021-02-28 0000040704 gis:UncommittedCreditFacilityMember 2021-02-28 0000040704 gis:LineOfCreditExpiringMay2022Member 2020-06-01 2021-02-28 0000040704 gis:LineOfCreditExpiringSeptember2022Member 2020-06-01 2021-02-28 0000040704 gis:RedeemableInterestsMember 2020-11-30 2021-02-28 0000040704 gis:RedeemableInterestsMember 2019-11-25 2020-02-23 0000040704 2019-05-26 0000040704 gis:EuropeAndAustraliaSegmentMember us-gaap:OperatingSegmentsMember 2020-11-30 2021-02-28 0000040704 gis:EuropeAndAustraliaSegmentMember us-gaap:OperatingSegmentsMember 2019-11-25 2020-02-23 0000040704 gis:AsiaAndLatinAmericaSegmentMember us-gaap:OperatingSegmentsMember 2020-11-30 2021-02-28 0000040704 gis:AsiaAndLatinAmericaSegmentMember us-gaap:OperatingSegmentsMember 2019-11-25 2020-02-23 0000040704 gis:PetSegmentMember us-gaap:OperatingSegmentsMember 2020-11-30 2021-02-28 0000040704 gis:PetSegmentMember us-gaap:OperatingSegmentsMember 2019-11-25 2020-02-23 0000040704 gis:ConvenienceStoresAndFoodserviceSegmentMember us-gaap:OperatingSegmentsMember 2020-11-30 2021-02-28 0000040704 gis:ConvenienceStoresAndFoodserviceSegmentMember us-gaap:OperatingSegmentsMember 2019-11-25 2020-02-23 0000040704 gis:NorthAmericaRetailSegmentMember us-gaap:OperatingSegmentsMember 2020-11-30 2021-02-28 0000040704 gis:NorthAmericaRetailSegmentMember us-gaap:OperatingSegmentsMember 2019-11-25 2020-02-23 0000040704 us-gaap:OperatingSegmentsMember gis:UnitedStatesMealsAndBakingOperatingUnitMember 2020-11-30 2021-02-28 0000040704 us-gaap:OperatingSegmentsMember gis:UnitedStatesMealsAndBakingOperatingUnitMember 2019-11-25 2020-02-23 0000040704 us-gaap:OperatingSegmentsMember gis:UnitedStatesCerealOperatingUnitMember 2020-11-30 2021-02-28 0000040704 us-gaap:OperatingSegmentsMember gis:UnitedStatesCerealOperatingUnitMember 2019-11-25 2020-02-23 0000040704 us-gaap:OperatingSegmentsMember gis:UnitedStatesSnacksOperatingUnitMember 2020-11-30 2021-02-28 0000040704 us-gaap:OperatingSegmentsMember gis:UnitedStatesSnacksOperatingUnitMember 2019-11-25 2020-02-23 0000040704 us-gaap:OperatingSegmentsMember gis:UnitedStatesYogurtAndOtherOperatingUnitMember 2020-11-30 2021-02-28 0000040704 us-gaap:OperatingSegmentsMember gis:UnitedStatesYogurtAndOtherOperatingUnitMember 2019-11-25 2020-02-23 0000040704 us-gaap:OperatingSegmentsMember gis:CanadaOperatingUnitMember 2020-11-30 2021-02-28 0000040704 us-gaap:OperatingSegmentsMember gis:CanadaOperatingUnitMember 2019-11-25 2020-02-23 0000040704 gis:SnacksMember 2020-11-30 2021-02-28 0000040704 gis:SnacksMember 2019-11-25 2020-02-23 0000040704 gis:CerealMember 2020-11-30 2021-02-28 0000040704 gis:CerealMember 2019-11-25 2020-02-23 0000040704 gis:ConvenientMealsMember 2020-11-30 2021-02-28 0000040704 gis:ConvenientMealsMember 2019-11-25 2020-02-23 0000040704 gis:YogurtMember 2020-11-30 2021-02-28 0000040704 gis:YogurtMember 2019-11-25 2020-02-23 0000040704 gis:SuperPremiumIceCreamMember 2020-11-30 2021-02-28 0000040704 gis:SuperPremiumIceCreamMember 2019-11-25 2020-02-23 0000040704 gis:OtherProductsMember 2020-11-30 2021-02-28 0000040704 gis:OtherProductsMember 2019-11-25 2020-02-23 0000040704 us-gaap:AdditionalPaidInCapitalMember 2020-11-29 0000040704 us-gaap:AdditionalPaidInCapitalMember 2019-11-24 0000040704 us-gaap:AdditionalPaidInCapitalMember 2021-02-28 0000040704 us-gaap:RetainedEarningsMember 2020-11-29 0000040704 us-gaap:RetainedEarningsMember 2019-11-24 0000040704 us-gaap:RetainedEarningsMember 2021-02-28 0000040704 us-gaap:TreasuryStockMember 2020-11-29 0000040704 us-gaap:TreasuryStockMember 2019-11-24 0000040704 us-gaap:TreasuryStockMember 2021-02-28 0000040704 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2020-11-29 0000040704 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2019-11-24 0000040704 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2021-02-28 0000040704 us-gaap:NoncontrollingInterestMember 2020-11-29 0000040704 us-gaap:NoncontrollingInterestMember 2019-11-24 0000040704 us-gaap:NoncontrollingInterestMember 2021-02-28 0000040704 2019-11-24 0000040704 gis:SodiaalInternationalMember 2020-11-29 0000040704 gis:SodiaalInternationalMember 2019-11-24 0000040704 gis:SodiaalInternationalMember 2020-11-30 2021-02-28 0000040704 gis:SodiaalInternationalMember 2019-11-25 2020-02-23 0000040704 gis:SodiaalInternationalMember 2021-02-28 0000040704 gis:SodiaalInternationalMember 2020-02-23 0000040704 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2020-11-30 2021-02-28 0000040704 us-gaap:RetainedEarningsMember 2020-11-30 2021-02-28 0000040704 us-gaap:AdditionalPaidInCapitalMember 2020-11-30 2021-02-28 0000040704 us-gaap:TreasuryStockMember 2020-11-30 2021-02-28 0000040704 2020-11-29 0000040704 us-gaap:AdditionalPaidInCapitalMember 2020-05-31 0000040704 us-gaap:AdditionalPaidInCapitalMember 2019-05-26 0000040704 us-gaap:AdditionalPaidInCapitalMember 2019-11-25 2020-02-23 0000040704 us-gaap:RetainedEarningsMember 2020-05-31 0000040704 us-gaap:RetainedEarningsMember 2019-05-26 0000040704 us-gaap:RetainedEarningsMember 2019-11-25 2020-02-23 0000040704 us-gaap:TreasuryStockMember 2020-05-31 0000040704 us-gaap:TreasuryStockMember 2019-05-26 0000040704 us-gaap:TreasuryStockMember 2019-11-25 2020-02-23 0000040704 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2020-05-31 0000040704 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2019-05-26 0000040704 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2019-11-25 2020-02-23 0000040704 us-gaap:NoncontrollingInterestMember 2020-05-31 0000040704 us-gaap:NoncontrollingInterestMember 2019-05-26 0000040704 gis:SodiaalInternationalMember 2020-05-31 0000040704 gis:SodiaalInternationalMember 2019-05-26 0000040704 gis:SodiaalInternationalMember 2020-06-01 2021-02-28 0000040704 gis:SodiaalInternationalMember 2019-05-27 2020-02-23 0000040704 us-gaap:CommonStockMember 2021-02-28 0000040704 us-gaap:RetainedEarningsMember srt:CumulativeEffectPeriodOfAdoptionAdjustmentMember 2020-05-31 0000040704 us-gaap:RetainedEarningsMember srt:CumulativeEffectPeriodOfAdoptionAdjustmentMember 2019-05-26 0000040704 us-gaap:ParentMember 2020-06-01 2021-02-28 0000040704 us-gaap:ParentMember 2019-05-27 2020-02-23 0000040704 us-gaap:EmployeeStockOptionMember 2020-06-01 2021-02-28 0000040704 us-gaap:EmployeeStockOptionMember 2019-05-27 2020-02-23 0000040704 us-gaap:RestrictedStockUnitsRSUMember 2020-06-01 2021-02-28 0000040704 us-gaap:RestrictedStockUnitsRSUMember 2019-05-27 2020-02-23 0000040704 us-gaap:PensionPlansDefinedBenefitMember 2020-06-01 2021-02-28 0000040704 us-gaap:PensionPlansDefinedBenefitMember 2019-05-27 2020-02-23 0000040704 us-gaap:OtherPostretirementBenefitPlansDefinedBenefitMember 2020-06-01 2021-02-28 0000040704 us-gaap:OtherPostretirementBenefitPlansDefinedBenefitMember 2019-05-27 2020-02-23 0000040704 gis:PostemploymentBenefitMember 2020-06-01 2021-02-28 0000040704 gis:PostemploymentBenefitMember 2019-05-27 2020-02-23 0000040704 gis:AsiaLatinAmericaRouteToMarketAndSupplyChainOptimizationMember 2020-11-30 2021-02-28 0000040704 gis:ActionsPreviouslyAnnouncedMember 2020-11-30 2021-02-28 0000040704 gis:AsiaLatinAmericaRouteToMarketAndSupplyChainOptimizationMember 2019-11-25 2020-02-23 0000040704 gis:ActionsPreviouslyAnnouncedMember 2019-11-25 2020-02-23 0000040704 gis:AsiaLatinAmericaRouteToMarketAndSupplyChainOptimizationMember 2020-06-01 2021-02-28 0000040704 gis:ActionsPreviouslyAnnouncedMember 2020-06-01 2021-02-28 0000040704 gis:AsiaLatinAmericaRouteToMarketAndSupplyChainOptimizationMember 2019-05-27 2020-02-23 0000040704 gis:ActionsPreviouslyAnnouncedMember 2019-05-27 2020-02-23 0000040704 gis:ThreePercentFixedRateNotesDueFebruary12051Member 2020-11-30 2021-02-28 0000040704 gis:ThreePercentFixedRateNotesDueFebruary12051Member 2021-02-28 0000040704 gis:NotesPreviouslyIssuedMember 2020-11-30 2021-02-28 0000040704 gis:NotesPreviouslyIssuedMember srt:MinimumMember 2021-02-28 0000040704 gis:NotesPreviouslyIssuedMember srt:MaximumMember 2021-02-28 0000040704 gis:ZeroPointZeroZeroZeroFixedRateNotes3Member 2020-11-29 0000040704 gis:ZeroPointZeroZeroZeroFixedRateNotes3Member 2020-08-31 2020-11-29 0000040704 gis:ZeroPointZeroZeroFixedRateNotes1Member 2020-08-31 2020-11-29 0000040704 gis:ZeroPointZeroZeroFixedRateNotes1Member 2020-11-29 0000040704 gis:TwopointonezerozerofixedratenotesmemberMember 2020-06-01 2020-08-30 0000040704 gis:TwopointonezerozerofixedratenotesmemberMember 2020-08-30 0000040704 us-gaap:OperatingSegmentsMember gis:NorthAmericaRetailSegmentMember 2020-06-01 2021-02-28 0000040704 us-gaap:OperatingSegmentsMember gis:EuropeAndAustraliaSegmentMember 2020-06-01 2021-02-28 0000040704 us-gaap:OperatingSegmentsMember gis:PetSegmentMember 2020-06-01 2021-02-28 0000040704 us-gaap:OperatingSegmentsMember gis:AsiaAndLatinAmericaSegmentMember 2020-06-01 2021-02-28 0000040704 us-gaap:OperatingSegmentsMember gis:ConvenienceStoresAndFoodserviceSegmentMember 2020-06-01 2021-02-28 0000040704 us-gaap:OperatingSegmentsMember 2020-06-01 2021-02-28 0000040704 us-gaap:OperatingSegmentsMember gis:NorthAmericaRetailSegmentMember 2019-05-27 2020-02-23 0000040704 us-gaap:OperatingSegmentsMember gis:EuropeAndAustraliaSegmentMember 2019-05-27 2020-02-23 0000040704 us-gaap:OperatingSegmentsMember gis:PetSegmentMember 2019-05-27 2020-02-23 0000040704 us-gaap:OperatingSegmentsMember gis:AsiaAndLatinAmericaSegmentMember 2019-05-27 2020-02-23 0000040704 us-gaap:OperatingSegmentsMember gis:ConvenienceStoresAndFoodserviceSegmentMember 2019-05-27 2020-02-23 0000040704 us-gaap:OperatingSegmentsMember 2019-05-27 2020-02-23 0000040704 us-gaap:CorporateNonSegmentMember 2020-06-01 2021-02-28 0000040704 us-gaap:CorporateNonSegmentMember 2019-05-27 2020-02-23 0000040704 gis:SnacksMember 2020-06-01 2021-02-28 0000040704 gis:SnacksMember 2019-05-27 2020-02-23 0000040704 gis:ConvenientMealsMember 2020-06-01 2021-02-28 0000040704 gis:ConvenientMealsMember 2019-05-27 2020-02-23 0000040704 gis:CerealMember 2020-06-01 2021-02-28 0000040704 gis:CerealMember 2019-05-27 2020-02-23 0000040704 gis:YogurtMember 2020-06-01 2021-02-28 0000040704 gis:YogurtMember 2019-05-27 2020-02-23 0000040704 gis:DoughMember 2020-06-01 2021-02-28 0000040704 gis:DoughMember 2019-05-27 2020-02-23 0000040704 gis:BakingMixesAndIngredientsMember 2020-06-01 2021-02-28 0000040704 gis:BakingMixesAndIngredientsMember 2019-05-27 2020-02-23 0000040704 gis:PetProductsMember 2020-06-01 2021-02-28 0000040704 gis:PetProductsMember 2019-05-27 2020-02-23 0000040704 gis:SuperPremiumIceCreamMember 2020-06-01 2021-02-28 0000040704 gis:SuperPremiumIceCreamMember 2019-05-27 2020-02-23 0000040704 gis:OtherProductsMember 2020-06-01 2021-02-28 0000040704 gis:OtherProductsMember 2019-05-27 2020-02-23 0000040704 us-gaap:OperatingSegmentsMember gis:UnitedStatesMealsAndBakingOperatingUnitMember 2020-06-01 2021-02-28 0000040704 us-gaap:OperatingSegmentsMember gis:UnitedStatesMealsAndBakingOperatingUnitMember 2019-05-27 2020-02-23 0000040704 us-gaap:OperatingSegmentsMember gis:UnitedStatesCerealOperatingUnitMember 2020-06-01 2021-02-28 0000040704 us-gaap:OperatingSegmentsMember gis:UnitedStatesCerealOperatingUnitMember 2019-05-27 2020-02-23 0000040704 us-gaap:OperatingSegmentsMember gis:UnitedStatesSnacksOperatingUnitMember 2020-06-01 2021-02-28 0000040704 us-gaap:OperatingSegmentsMember gis:UnitedStatesSnacksOperatingUnitMember 2019-05-27 2020-02-23 0000040704 us-gaap:OperatingSegmentsMember gis:CanadaOperatingUnitMember 2020-06-01 2021-02-28 0000040704 us-gaap:OperatingSegmentsMember gis:CanadaOperatingUnitMember 2019-05-27 2020-02-23 0000040704 us-gaap:OperatingSegmentsMember gis:UnitedStatesYogurtAndOtherOperatingUnitMember 2020-06-01 2021-02-28 0000040704 us-gaap:OperatingSegmentsMember gis:UnitedStatesYogurtAndOtherOperatingUnitMember 2019-05-27 2020-02-23 0000040704 us-gaap:RestructuringChargesMember 2020-06-01 2021-02-28 0000040704 us-gaap:RestructuringChargesMember 2019-05-27 2020-02-23 0000040704 us-gaap:CostOfSalesMember 2020-06-01 2021-02-28 0000040704 us-gaap:CostOfSalesMember 2019-05-27 2020-02-23 0000040704 gis:DoughMember 2020-11-30 2021-02-28 0000040704 gis:DoughMember 2019-11-25 2020-02-23 0000040704 gis:BakingMixesAndIngredientsMember 2020-11-30 2021-02-28 0000040704 gis:BakingMixesAndIngredientsMember 2019-11-25 2020-02-23 0000040704 gis:PetProductsMember 2020-11-30 2021-02-28 0000040704 gis:PetProductsMember 2019-11-25 2020-02-23 0000040704 gis:RedeemableInterestsMember gis:YoplaitSasSubsidiaryMember 2019-05-27 2020-02-23 0000040704 us-gaap:FairValueInputsLevel2Member 2021-02-28 0000040704 gis:AsiaLatinAmericaRouteToMarketAndSupplyChainOptimizationMember 2021-02-28 0000040704 us-gaap:EmployeeSeveranceMember gis:AsiaLatinAmericaRouteToMarketAndSupplyChainOptimizationMember 2021-02-28 0000040704 us-gaap:OtherRestructuringMember gis:AsiaLatinAmericaRouteToMarketAndSupplyChainOptimizationMember 2021-02-28 0000040704 us-gaap:EmployeeSeveranceMember gis:AsiaLatinAmericaRouteToMarketAndSupplyChainOptimizationMember 2020-11-30 2021-02-28 0000040704 us-gaap:OtherRestructuringMember gis:AsiaLatinAmericaRouteToMarketAndSupplyChainOptimizationMember 2020-11-30 2021-02-28 0000040704 us-gaap:ParentMember gis:YoplaitMarquesSncAndLiberteMarquesSarlMember 2021-02-28 0000040704 us-gaap:RetainedEarningsMember srt:CumulativeEffectPeriodOfAdoptionAdjustmentMember 2020-06-01 2021-02-28 0000040704 gis:CertainLongTermDebtAgreementsContainingRestrictiveCovenantsMember 2020-06-01 2021-02-28 iso4217:EUR iso4217:USD xbrli:pure xbrli:shares iso4217:USD xbrli:shares

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

 

(Mark One)

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED FEBRUARY 28, 2021

 

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD FROM              TO

 

Commission file number: 001-01185

________________

GENERAL MILLS, INC.

(Exact name of registrant as specified in its charter)

 

Delaware

41-0274440

(State or other jurisdiction of

(I.R.S. Employer

incorporation or organization)

Identification No.)

 

 

Number One General Mills Boulevard

 

Minneapolis, Minnesota

55426

(Address of principal executive offices)

(Zip Code)

 

 

 

(763)764-7600

(Registrant’s telephone number, including area code)

 

Securities registered pursuant to Section 12(b) of the Act:

 

 

 

 

 

 

Title of each class

 

Trading Symbol(s)

 

Name of each exchange

on which registered

Common Stock, $.10 par value

 

GIS

 

New York Stock Exchange

1.000% Notes due 2023

 

GIS23A

 

New York Stock Exchange

0.450% Notes due 2026

 

GIS26

 

New York Stock Exchange

1.500% Notes due 2027

 

GIS27

 

New York Stock Exchange

 

 

 

________________

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Yes No

 

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes   No

 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer

 

Accelerated filer

Non-accelerated filer

Smaller reporting company

 

 

 

 

Emerging growth company

 

 


 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

 

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes No

 

Number of shares of Common Stock outstanding as of March 15, 2021: 609,971,269 (excluding 144,642,059 shares held in the treasury).

 


 

General Mills, Inc.

 

Table of Contents

 

 

Page

PART I – Financial Information

 

Item 1. Financial Statements

 

Consolidated Statements of Earnings for the quarters and nine-month periods ended February 28, 2021 and February 23, 2020

4

Consolidated Statements of Comprehensive Income for the quarters and nine-month periods ended February 28, 2021 and February 23, 2020

5

Consolidated Balance Sheets as of February 28, 2021, and May 31, 2020

6

Consolidated Statements of Total Equity and Redeemable Interest for the quarters and nine-month periods ended February 28, 2021 and February 23, 2020

7

Consolidated Statements of Cash Flows for the nine-month periods ended February 28, 2021 and February 23, 2020

9

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

20

Item 3. Quantitative and Qualitative Disclosures About Market Risk

40

Item 4. Controls and Procedures

41

PART II – Other Information

 

Item 6. Exhibits

42

Signatures

43

 

3


 

 

PART I. FINANCIAL INFORMATION

 

 

 

 

 

 

 

 

 

 

 

 

Item 1. Financial Statements

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Consolidated Statements of Earnings

GENERAL MILLS, INC. AND SUBSIDIARIES

(Unaudited) (In Millions, Except per Share Data)

 

 

 

 

 

 

 

 

 

 

 

 

 

Quarter Ended

 

Nine-Month Period Ended

 

Feb. 28, 2021

 

Feb. 23, 2020

 

 

Feb. 28, 2021

 

Feb. 23, 2020

Net sales

$

4,520.0

 

$

4,180.3

 

$

13,603.4

 

$

12,603.6

Cost of sales

 

2,966.1

 

 

2,777.1

 

 

8,738.0

 

 

8,241.8

Selling, general, and administrative expenses

 

716.3

 

 

746.6

 

 

2,256.6

 

 

2,224.5

Restructuring, impairment, and other exit costs

 

11.0

 

 

5.8

 

 

11.9

 

 

12.9

Operating profit

 

826.6

 

 

650.8

 

 

2,596.9

 

 

2,124.4

Benefit plan non-service income

 

(33.4)

 

 

(30.3)

 

 

(99.6)

 

 

(90.7)

Interest, net

 

106.0

 

 

109.8

 

 

317.7

 

 

347.9

Earnings before income taxes and after-tax earnings from

joint ventures

 

754.0

 

 

571.3

 

 

2,378.8

 

 

1,867.2

Income taxes

 

162.0

 

 

118.2

 

 

522.2

 

 

340.9

After-tax earnings from joint ventures

 

11.8

 

 

10.8

 

 

89.5

 

 

57.5

Net earnings, including earnings attributable to redeemable

and noncontrolling interests

 

603.8

 

 

463.9

 

 

1,946.1

 

 

1,583.8

Net earnings attributable to redeemable and

noncontrolling interests

 

8.1

 

 

9.8

 

 

23.1

 

 

28.3

Net earnings attributable to General Mills

$

595.7

 

$

454.1

 

$

1,923.0

 

$

1,555.5

Earnings per share – basic

$

0.97

 

$

0.75

 

$

3.13

 

$

2.56

Earnings per share – diluted

$

0.96

 

$

0.74

 

$

3.10

 

$

2.54

 

 

 

 

 

 

 

 

 

 

 

 

See accompanying notes to consolidated financial statements.

4


 

 

Consolidated Statements of Comprehensive Income

GENERAL MILLS, INC. AND SUBSIDIARIES

(Unaudited) (In Millions)

 

 

 

 

 

 

 

 

 

 

 

 

 

Quarter Ended

 

Nine-Month Period Ended

 

Feb. 28, 2021

 

Feb. 23, 2020

 

Feb. 28, 2021

 

Feb. 23, 2020

Net earnings, including earnings attributable to

redeemable and noncontrolling interests

$

603.8

 

$

463.9

 

$

1,946.1

 

$

1,583.8

Other comprehensive income (loss), net of tax:

 

 

 

 

 

 

 

 

 

 

 

Foreign currency translation

 

12.5

 

 

(22.0)

 

 

102.4

 

 

(28.5)

Other fair value changes:

 

 

 

 

 

 

 

 

 

 

 

Hedge derivatives

 

0.1

 

 

(6.4)

 

 

(10.1)

 

 

(15.4)

Reclassification to earnings:

 

 

 

 

 

 

 

 

 

 

 

Hedge derivatives

 

5.4

 

 

4.0

 

 

4.7

 

 

3.6

Amortization of losses and prior service costs

 

19.8

 

 

19.6

 

 

59.1

 

 

58.8

Other comprehensive income (loss), net of tax

 

37.8

 

 

(4.8)

 

 

156.1

 

 

18.5

Total comprehensive income

 

641.6

 

 

459.1

 

 

2,102.2

 

 

1,602.3

Comprehensive income (loss) attributable to

redeemable and noncontrolling interests

 

21.0

 

 

(0.3)

 

 

107.5

 

 

5.9

Comprehensive income attributable to General Mills

$

620.6

 

$

459.4

 

$

1,994.7

 

$

1,596.4

 

 

 

 

 

 

 

 

 

 

 

 

See accompanying notes to consolidated financial statements.

5


 

 

Consolidated Balance Sheets

GENERAL MILLS, INC. AND SUBSIDIARIES

(In Millions, Except Par Value)

 

Feb. 28, 2021

 

May 31, 2020

 

 

(Unaudited)

 

 

 

ASSETS

 

 

 

 

 

Current assets:

 

 

 

 

 

Cash and cash equivalents

$

2,754.2

 

$

1,677.8

Receivables

 

1,776.2

 

 

1,615.1

Inventories

 

1,758.8

 

 

1,426.3

Prepaid expenses and other current assets

 

323.2

 

 

402.1

Total current assets

 

6,612.4

 

 

5,121.3

Land, buildings, and equipment

 

3,505.5

 

 

3,580.6

Goodwill

 

14,034.6

 

 

13,923.2

Other intangible assets

 

7,148.3

 

 

7,095.8

Other assets

 

1,348.0

 

 

1,085.8

Total assets

$

32,648.8

 

$

30,806.7

LIABILITIES AND EQUITY

 

 

 

 

 

Current liabilities:

 

 

 

 

 

Accounts payable

$

3,391.6

 

$

3,247.7

Current portion of long-term debt

 

3,899.8

 

 

2,331.5

Notes payable

 

184.6

 

 

279.0

Other current liabilities

 

2,113.7

 

 

1,633.3

Total current liabilities

 

9,589.7

 

 

7,491.5

Long-term debt

 

9,766.6

 

 

10,929.0

Deferred income taxes

 

2,006.2

 

 

1,947.1

Other liabilities

 

1,502.4

 

 

1,545.0

Total liabilities

 

22,864.9

 

 

21,912.6

Redeemable interest

 

596.0

 

 

544.6

Stockholders' equity:

 

 

 

 

 

Common stock, 754.6 shares issued, $0.10 par value

 

75.5

 

 

75.5

Additional paid-in capital

 

1,353.8

 

 

1,348.6

Retained earnings

 

16,655.0

 

 

15,982.1

Common stock in treasury, at cost, shares of 142.8 and 144.8

 

(6,351.3)

 

 

(6,433.3)

Accumulated other comprehensive loss

 

(2,842.7)

 

 

(2,914.4)

Total stockholders' equity

 

8,890.3

 

 

8,058.5

Noncontrolling interests

 

297.6

 

 

291.0

Total equity

 

9,187.9

 

 

8,349.5

Total liabilities and equity

$

32,648.8

 

$

30,806.7

 

 

 

 

 

 

See accompanying notes to consolidated financial statements.

 

 

 

 

 

6


 

 

Consolidated Statements of Total Equity and Redeemable Interest

GENERAL MILLS, INC. AND SUBSIDIARIES

(Unaudited) (In Millions, Except per Share Data)

 

 

 

 

 

 

 

 

 

 

 

Quarter Ended

 

Feb. 28, 2021

 

Feb. 23, 2020

 

Shares

 

Amount

 

Shares

 

Amount

Total equity, beginning balance

 

 

$

8,852.6

 

 

 

$

8,020.6

Common stock, 1 billion shares authorized, $0.10 par value

754.6

 

 

75.5

 

754.6

 

 

75.5

Additional paid-in capital:

 

 

 

 

 

 

 

 

 

Beginning balance

 

 

 

1,333.3

 

 

 

 

1,387.0

Stock compensation plans

 

 

 

(8.3)

 

 

 

 

(36.2)

Unearned compensation related to stock unit awards

 

 

 

(0.5)

 

 

 

 

(1.4)

Earned compensation

 

 

 

20.7

 

 

 

 

17.8

Decrease (increase) in redemption value of

redeemable interest

 

 

 

8.6

 

 

 

 

(32.3)

Ending balance

 

 

 

1,353.8

 

 

 

 

1,334.9

Retained earnings:

 

 

 

 

 

 

 

 

 

Beginning balance

 

 

 

16,374.2

 

 

 

 

15,501.8

Comprehensive income

 

 

 

595.7

 

 

 

 

454.1

Cash dividends declared ($0.51 and $0.98 per share)

 

 

 

(314.9)

 

 

 

 

(595.9)

Ending balance

 

 

 

16,655.0

 

 

 

 

15,360.0

Common stock in treasury:

 

 

 

 

 

 

 

 

 

Beginning balance

(143.2)

 

 

(6,365.4)

 

(150.0)

 

 

(6,662.2)

Shares purchased

-

 

 

(0.5)

 

-

 

 

(2.7)

Stock compensation plans

0.4

 

 

14.6

 

1.2

 

 

54.1

Ending balance

(142.8)

 

 

(6,351.3)

 

(148.8)

 

 

(6,610.8)

Accumulated other comprehensive loss:

 

 

 

 

 

 

 

 

 

Beginning balance

 

 

 

(2,867.6)

 

 

 

 

(2,589.8)

Comprehensive income

 

 

 

24.9

 

 

 

 

5.3

Ending balance

 

 

 

(2,842.7)

 

 

 

 

(2,584.5)

Noncontrolling interests:

 

 

 

 

 

 

 

 

 

Beginning balance

 

 

 

302.6

 

 

 

 

308.3

Comprehensive income (loss)

 

 

 

3.7

 

 

 

 

(1.5)

Distributions to noncontrolling interest holders

 

 

 

(8.7)

 

 

 

 

(21.8)

Ending balance

 

 

 

297.6

 

 

 

 

285.0

Total equity, ending balance

 

 

$

9,187.9

 

 

 

$

7,860.1

Redeemable interest:

 

 

 

 

 

 

 

 

 

Beginning balance

 

 

$

587.7

 

 

 

$

545.1

Comprehensive income

 

 

 

17.3

 

 

 

 

1.2

(Decrease) increase in redemption value of

redeemable interest

 

 

 

(8.6)

 

 

 

 

32.3

Distributions to redeemable interest holder

 

 

 

(0.4)

 

 

 

 

(40.0)

Ending balance

 

 

$

596.0

 

 

 

$

538.6

See accompanying notes to consolidated financial statements.

7


 

Consolidated Statements of Total Equity and Redeemable Interest

GENERAL MILLS, INC. AND SUBSIDIARIES

(Unaudited) (In Millions, Except per Share Data)

 

 

 

 

 

 

 

 

 

 

 

Nine-Month Period Ended

 

Feb. 28, 2021

 

Feb. 23, 2020

 

Shares

 

Amount

 

Shares

 

Amount

Total equity, beginning balance

 

 

$

8,349.5

 

 

 

$

7,367.7

Common stock, 1 billion shares authorized, $0.10 par value

754.6

 

 

75.5

 

754.6

 

 

75.5

Additional paid-in capital:

 

 

 

 

 

 

 

 

 

Beginning balance

 

 

 

1,348.6

 

 

 

 

1,386.7

Stock compensation plans

 

 

 

12.9

 

 

 

 

(22.4)

Unearned compensation related to stock unit awards

 

 

 

(78.2)

 

 

 

 

(71.3)

Earned compensation

 

 

 

68.9

 

 

 

 

65.1

Decrease (increase) in redemption value of

redeemable interest

 

 

 

1.6

 

 

 

 

(23.2)

Ending balance

 

 

 

1,353.8

 

 

 

 

1,334.9

Retained earnings:

 

 

 

 

 

 

 

 

 

Beginning balance

 

 

 

15,982.1

 

 

 

 

14,996.7

Comprehensive income

 

 

 

1,923.0

 

 

 

 

1,555.5

Cash dividends declared ($2.02 and $1.96 per share)

 

 

 

(1,244.4)

 

 

 

 

(1,192.2)

Adoption of current expected credit loss accounting requirements

 

 

 

(5.7)

 

 

 

 

-

Ending balance

 

 

 

16,655.0

 

 

 

 

15,360.0

Common stock in treasury:

 

 

 

 

 

 

 

 

 

Beginning balance

(144.8)

 

 

(6,433.3)

 

(152.7)

 

 

(6,779.0)

Shares purchased

-

 

 

(0.6)

 

-

 

 

(2.8)

Stock compensation plans

2.0

 

 

82.6

 

3.9

 

 

171.0

Ending balance

(142.8)

 

 

(6,351.3)

 

(148.8)

 

 

(6,610.8)

Accumulated other comprehensive loss:

 

 

 

 

 

 

 

 

 

Beginning balance

 

 

 

(2,914.4)

 

 

 

 

(2,625.4)

Comprehensive income

 

 

 

71.7

 

 

 

 

40.9

Ending balance

 

 

 

(2,842.7)

 

 

 

 

(2,584.5)

Noncontrolling interests:

 

 

 

 

 

 

 

 

 

Beginning balance

 

 

 

291.0

 

 

 

 

313.2

Comprehensive income

 

 

 

31.8

 

 

 

 

2.2

Distributions to noncontrolling interest holders

 

 

 

(25.2)

 

 

 

 

(30.4)

Ending balance

 

 

 

297.6

 

 

 

 

285.0

Total equity, ending balance

 

 

$

9,187.9

 

 

 

$

7,860.1

Redeemable interest:

 

 

 

 

 

 

 

 

 

Beginning balance

 

 

$

544.6

 

 

 

$

551.7

Comprehensive income

 

 

 

75.7

 

 

 

 

3.7

(Decrease) increase in redemption value of

redeemable interest

 

 

 

(1.6)

 

 

 

 

23.2

Distributions to redeemable interest holder

 

 

 

(22.7)

 

 

 

 

(40.0)

Ending balance

 

 

$

596.0

 

 

 

$

538.6

See accompanying notes to consolidated financial statements.

 

 

 

 

 

 

 

 

 

8


 

 

Consolidated Statements of Cash Flows

GENERAL MILLS, INC. AND SUBSIDIARIES

(Unaudited) (In Millions)

 

Nine-Month Period Ended

 

Feb. 28, 2021

 

Feb. 23, 2020

Cash Flows - Operating Activities

 

 

 

 

 

Net earnings, including earnings attributable to redeemable and noncontrolling interests

$

1,946.1

 

$

1,583.8

Adjustments to reconcile net earnings to net cash provided by operating activities:

 

 

 

 

 

Depreciation and amortization

 

454.5

 

 

456.4

After-tax earnings from joint ventures

 

(89.5)

 

 

(57.5)

Distributions of earnings from joint ventures

 

41.9

 

 

37.7

Stock-based compensation

 

69.5

 

 

66.0

Deferred income taxes

 

110.9

 

 

1.7

Pension and other postretirement benefit plan contributions

 

(25.7)

 

 

(21.7)

Pension and other postretirement benefit plan costs

 

(25.5)

 

 

(23.2)

Restructuring, impairment, and other exit costs

 

5.7

 

 

20.6

Changes in current assets and liabilities

 

(145.4)

 

 

91.3

Other, net

 

(134.6)

 

 

4.7

Net cash provided by operating activities

 

2,207.9

 

 

2,159.8

Cash Flows - Investing Activities

 

 

 

 

 

Purchases of land, buildings, and equipment

 

(346.4)

 

 

(269.4)

Investments in affiliates, net

 

18.1

 

 

(40.9)

Proceeds from disposal of land, buildings, and equipment

 

1.8

 

 

0.9

Other, net

 

(5.5)

 

 

4.8

Net cash used by investing activities

 

(332.0)

 

 

(304.6)

Cash Flows - Financing Activities

 

 

 

 

 

Change in notes payable

 

(96.9)

 

 

(282.9)

Issuance of long-term debt

 

1,576.5

 

 

867.8

Payment of long-term debt

 

(1,159.0)

 

 

(1,396.5)

Debt exchange participation incentive cash payment

 

(201.4)

 

 

-

Proceeds from common stock issued on exercised options

 

39.4

 

 

109.4

Purchases of common stock for treasury

 

(0.6)

 

 

(2.8)

Dividends paid

 

(932.4)

 

 

(895.4)

Distributions to noncontrolling and redeemable interest holders

 

(47.9)

 

 

(70.4)

Other, net

 

(30.4)

 

 

(20.6)

Net cash used by financing activities

 

(852.7)

 

 

(1,691.4)

Effect of exchange rate changes on cash and cash equivalents

 

53.2

 

 

(6.9)

Increase in cash and cash equivalents

 

1,076.4

 

 

156.9

Cash and cash equivalents - beginning of year

 

1,677.8

 

 

450.0

Cash and cash equivalents - end of period

$

2,754.2

 

$

606.9

Cash Flow from changes in current assets and liabilities:

 

 

 

 

 

Receivables

$

(119.2)

 

$

(60.3)

Inventories

 

(302.2)

 

 

2.5

Prepaid expenses and other current assets

 

58.8

 

 

54.8

Accounts payable

 

154.7

 

 

119.9

Other current liabilities

 

62.5

 

 

(25.6)

Changes in current assets and liabilities

$

(145.4)

 

$

91.3

 

 

 

 

 

 

See accompanying notes to consolidated financial statements.

 

 

 

 

 

9


 

GENERAL MILLS, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

 

(1) Background

 

The accompanying Consolidated Financial Statements of General Mills, Inc. (we, us, our, General Mills, or the Company) have been prepared in accordance with accounting principles generally accepted in the United States (GAAP) for interim financial information and with the rules and regulations for reporting on Form 10-Q. Accordingly, they do not include certain information and disclosures required for comprehensive financial statements. In the opinion of management, all adjustments considered necessary for a fair presentation have been included and are of a normal recurring nature, including the elimination of all intercompany transactions and any noncontrolling and redeemable interests’ share of those transactions. Operating results for the quarter ended February 28, 2021, are not necessarily indicative of the results that may be expected for the fiscal year ending May 30, 2021.

 

These statements should be read in conjunction with the Consolidated Financial Statements and footnotes included in our Annual Report on Form 10-K for the fiscal year ended May 31, 2020. The accounting policies used in preparing these Consolidated Financial Statements are the same as those described in Note 2 to the Consolidated Financial Statements in that Form 10-K with the exception of new requirements adopted in the first quarter of fiscal 2021.

 

In the first quarter of fiscal 2021, we adopted new accounting requirements related to the measurement of credit losses on financial instruments, including trade receivables. The new standard and subsequent amendments replace the incurred loss impairment model with a forward-looking expected credit loss model, which will generally result in earlier recognition of credit losses. Our allowance for doubtful accounts represents our estimate of expected credit losses related to our trade receivables. We pool our trade receivables based on similar risk characteristics, such as geographic location, business channel, and other account data. To estimate our allowance for doubtful accounts, we leverage information on historical losses, asset-specific risk characteristics, current conditions, and reasonable and supportable forecasts of future conditions. Account balances are written off against the allowance when we deem the amount is uncollectible. We adopted the requirements of the new standard and subsequent amendments using the modified retrospective transition approach, and recorded a decrease to retained earnings of $5.7 million after-tax.

 

Certain terms used throughout this report are defined in the “Glossary” section below.

 

 

(2) Restructuring, Impairment, and Other Exit Costs

 

Restructuring charges were as follows:

 

 

Quarter Ended

 

Nine-Month Period Ended

In Millions

Feb. 28, 2021

 

Feb. 23, 2020

 

Feb. 28, 2021

 

Feb. 23, 2020

Asia & Latin America route-to-market

and supply chain optimization

$

11.5

 

$

-

 

$

11.5

 

$

-

Charges associated with restructuring actions

previously announced

 

0.2

 

 

12.4

 

 

2.1

 

 

37.2

Total restructuring charges

$

11.7

 

$

12.4

 

$

13.6

 

$

37.2

 

In the third quarter of fiscal 2021, we approved restructuring actions to leverage more efficient and effective route-to-market models and to optimize our supply chain in our Asia & Latin America segment. We expect to incur approximately $21 million of restructuring charges related to these actions, of which approximately $15 million will be cash. These charges are expected to consist of approximately $10 million of severance and $11 million of other costs, primarily asset write-offs. We recognized $8.9 million of severance and $2.6 million of other costs in the third quarter of fiscal 2021 related to these actions. We expect these actions to be completed by the end of the first quarter of fiscal 2022.

 

The charges associated with restructuring actions previously announced primarily relate to actions to drive efficiencies in targeted areas of our global supply chain. We expect these actions to be completed by the end of fiscal 2023.

 

Certain actions are subject to union negotiations and works counsel consultations, where required.

 

We paid net $7.9 million of cash in the nine-month period ended February 28, 2021, related to restructuring actions. We paid net $16.6 million of cash in the same period of fiscal 2020.

 

10


 

Restructuring and impairment charges and project-related costs are recorded in our Consolidated Statements of Earnings as follows:

 

 

Quarter Ended

 

Nine-Month Period Ended

In Millions

Feb. 28, 2021

 

Feb. 23, 2020

 

Feb. 28, 2021

 

Feb. 23, 2020

Restructuring, impairment, and other exit costs

$

11.0

 

$

5.8

 

$

11.9

 

$

12.9

Cost of sales

 

0.7

 

 

6.6

 

 

1.7

 

 

24.3

Total restructuring charges

$

11.7

 

$

12.4

 

$

13.6

 

$

37.2

Project-related costs classified in cost of sales

$

-

 

$

0.4

 

$

-

 

$

1.1

 

(3) Goodwill and Other Intangible Assets

 

The components of goodwill and other intangible assets are as follows:

 

In Millions

Feb. 28, 2021

 

May 31, 2020

Goodwill

$

14,034.6

 

$

13,923.2

Other intangible assets:

 

 

 

 

 

Intangible assets not subject to amortization:

 

 

 

 

 

Brands and other indefinite-lived intangibles

 

6,619.1

 

 

6,561.4

Intangible assets subject to amortization:

 

 

 

 

 

Franchise agreements, customer relationships, and other finite-lived intangibles

 

817.5

 

 

777.8

Less accumulated amortization

 

(288.3)

 

 

(243.4)

Intangible assets subject to amortization, net

 

529.2

 

 

534.4

Other intangible assets

 

7,148.3

 

 

7,095.8

Total

$

21,182.9

 

$

21,019.0

 

 

Based on the carrying value of finite-lived intangible assets as of February 28, 2021, annual amortization expense for each of the next five fiscal years is estimated to be approximately $40 million.

 

The changes in the carrying amount of goodwill during the nine-month period ended February 28, 2021 were as follows:

 

In Millions

 

North America Retail

 

Pet

 

Convenience Stores & Foodservice

 

Europe & Australia

 

Asia & Latin America

 

Joint Ventures

 

Total

Balance as of May 31, 2020

 

$

6,403.7

 

$

5,300.5

 

$

918.8

 

$

690.7

 

$

203.8

 

$

405.7

 

$

13,923.2

Other activity, primarily

foreign currency translation

 

 

9.0

 

 

-

 

 

-

 

 

66.3

 

 

0.5

 

 

35.6

 

 

111.4

Balance as of Feb. 28, 2021

 

$

6,412.7

 

$

5,300.5

 

$

918.8

 

$

757.0

 

$

204.3

 

$

441.3

 

$

14,034.6

 

The changes in the carrying amount of other intangible assets during the nine-month period ended February 28, 2021 were as follows:

In Millions

 

 

Total

Balance as of May 31, 2020

 

$

7,095.8

Other activity, primarily foreign currency translation

 

 

52.5

Balance as of Feb. 28, 2021

 

$

7,148.3

 

Our annual goodwill and indefinite-lived intangible assets impairment test was performed on the first day of the second quarter of fiscal 2021, and we determined there was no impairment of our intangible assets as their related fair values were substantially in excess of the carrying values.

 

While having significant coverage as of our fiscal 2021 assessment date, the Europe & Australia reporting unit and the Progresso, Green Giant, and EPIC brand intangible assets had risk of decreasing coverage. We will continue to monitor these businesses for potential impairment.

 

11


 

(4) Inventories

 

The components of inventories were as follows:

 

In Millions

Feb. 28, 2021

 

May 31, 2020

Raw materials and packaging

$

420.4

 

$

392.2

Finished goods

 

1,418.5

 

 

1,142.6

Grain

 

119.0

 

 

93.6

Excess of FIFO over LIFO cost

 

(199.1)

 

 

(202.1)

Total

$

1,758.8

 

$

1,426.3

 

(5) Risk Management Activities

 

Many commodities we use in the production and distribution of our products are exposed to market price risks. We utilize derivatives to manage price risk for our principal ingredients and energy costs, including grains (oats, wheat, and corn), oils (principally soybean), dairy products, natural gas, and diesel fuel. Our primary objective when entering into these derivative contracts is to achieve certainty with regard to the future price of commodities purchased for use in our supply chain. We manage our exposures through a combination of purchase orders, long-term contracts with suppliers, exchange-traded futures and options, and over-the-counter options and swaps. We offset our exposures based on current and projected market conditions and generally seek to acquire the inputs at as close to our planned cost as possible.

 

We use derivatives to manage our exposure to changes in commodity prices. We do not perform the assessments required to achieve hedge accounting for commodity derivative positions. Accordingly, the changes in the values of these derivatives are recorded currently in cost of sales in our Consolidated Statements of Earnings.

 

Although we do not meet the criteria for cash flow hedge accounting, we believe that these instruments are effective in achieving our objective of providing certainty in the future price of commodities purchased for use in our supply chain. Accordingly, for purposes of measuring segment operating performance, these gains and losses are reported in unallocated corporate items outside of segment operating results until such time that the exposure we are managing affects earnings. At that time we reclassify the gain or loss from unallocated corporate items to segment operating profit, allowing our operating segments to realize the economic effects of the derivative without experiencing any resulting mark-to-market volatility, which remains in unallocated corporate items.

 

Unallocated corporate items for the quarters and nine-month periods ended February 28, 2021, and February 23, 2020, included:

 

 

Quarter Ended

 

Nine-Month Period Ended

In Millions

Feb. 28, 2021

 

Feb. 23, 2020

 

Feb. 28, 2021

 

Feb. 23, 2020

Net gain (loss) on mark-to-market valuation of certain

commodity positions

$

51.0

 

$

(8.7)

 

$

95.0

 

$

(19.7)

Net (gain) loss on commodity positions reclassified from

unallocated corporate items to segment

operating profit

 

(3.9)

 

 

4.5

 

 

12.8

 

 

19.8

Net mark-to-market revaluation of certain grain inventories

 

8.6

 

 

(4.4)

 

 

10.2

 

 

(1.1)

Net mark-to-market valuation of certain

commodity positions recognized in unallocated

corporate items

$

55.7

 

$

(8.6)

 

$

118.0

 

$

(1.0)

 

As of February 28, 2021, the net notional value of commodity derivatives was $280.0 million, of which $52.0 million related to energy inputs and $228.0 million related to agricultural inputs. These contracts relate to inputs that generally will be utilized within the next 12 months.

 

In advance of planned debt financing, in the fourth quarter of fiscal 2020, we entered into $300.0 million of treasury locks due January 13, 2022 with an average fixed rate of 0.85 percent.

 

During the third quarter of fiscal 2020, we entered into a €600.0 million interest rate swap to convert our €600.0 million fixed rate notes due January 15, 2026, to a floating rate.

 

During the second quarter of fiscal 2020, we entered into a $500.0 million interest rate swap to convert a portion of our $850.0 million floating-rate notes due April 16, 2021, to a fixed rate.

12


 

 

The fair values of the derivative positions used in our risk management activities and other assets recorded at fair value were not material as of February 28, 2021, and were Level 1 or Level 2 assets and liabilities in the fair value hierarchy. We did not significantly change our valuation techniques from prior periods.

 

We offer certain suppliers access to third party services that allow them to view our scheduled payments online. The third party services also allow suppliers to finance advances on our scheduled payments at the sole discretion of the supplier and the third party. We have no economic interest in these financing arrangements and no direct relationship with the suppliers, the third parties, or any financial institutions concerning these services. All of our accounts payable remain as obligations to our suppliers as stated in our supplier agreements. As of February 28, 2021, $1,420.3 million of our total accounts payable were payable to suppliers who utilize these third party services.

 

(6) Debt

 

The components of notes payable were as follows:

 

In Millions

Feb. 28, 2021

 

May 31, 2020

U.S. commercial paper

$

-

 

$

99.9

Financial institutions

 

184.6

 

 

179.1

Total

$

184.6

 

$

279.0

 

 To ensure availability of funds, we maintain bank credit lines and have commercial paper programs available to us in the United States and Europe. We also have committed and asset-backed credit lines that support our foreign operations.

 

The following table details the fee-pai