Dec 17 (Reuters) - General Mills beat estimates for second-quarter sales and profit on Wednesday, as more consumers ate at home than dined out, boosting demand for the Pillsbury dough maker's pantry staples and breakfast cereals.
Shares of the Cheerios maker, which reaffirmed its annual forecasts for a second time, were up 1% in premarket trading.
While U.S. consumer sentiment improved in early December, budget-conscious shoppers still preferred home-made meals over restaurants amid high prices and
labor market uncertainties.
General Mills experienced a "volatile operating environment" for the quarter, CEO Jeff Harmening said, while noting "improved momentum" in the first half of the year.
SNAP benefits, which provide food assistance to those with lower income, also lapsed temporarily for the first time ever during the federal shutdown, further squeezing household budgets.
The company posted sales of $4.86 billion for the quarter ended November 23, compared with analysts' estimates of $4.78 billion, according to data compiled by LSEG.
It reported an adjusted profit of $1.10 per share, beating expectations of $1.03 per share.
The company had said in June it will remove synthetic dyes from its full U.S. retail portfolio by the end of fiscal 2027, a trend that is accelerating as more consumers opt for healthier options and in line with the Trump administration's "Make America Healthy Again" movement.
General Mills reiterated its forecast of a 10% to 15% fall in annual profit, and organic net sales between a 1% rise or a 1% fall.
Similarly, packaged foods peer Campbell's Co beat expectations for first-quarter profit last week and maintained its annual sales and profit forecasts.
(Reporting by Koyena Das and Neil J Kanatt in Bengaluru; Editing by Leroy Leo)
