Business Monday

General Mills’ investment in Brazil pays off

A view of the reception area of the General Mills Latin America headquarters in Doral.
A view of the reception area of the General Mills Latin America headquarters in Doral. FOR THE MIAMI HERALD

General Mills, the Minneapolis-based international food processor, has been doing business in Latin America for a long time.

The global giant, famous in the United States for brands like Cheerios, Betty Crocker, Gold Medal and a host of others, was founded in 1928 and began exporting flour to Latin America more than 75 years ago.

Today, the global company sells a wide range of its own and locally produced brands in Latin America, has 12 production facilities in the region and about 8,000 employees, out of a worldwide headcount of about 43,000.

It competes against major food processors in the United States, like Kellogg’s, Post Foods and PepsiCo, as well as other food companies and store brands here and overseas.

General Mills opened its current regional headquarters for Latin America in Doral in 2005, but the company began operating here before that. Pillsbury, formerly a major competitor, moved into its Latin America regional office in Miami in the 1990s. In 2000, General Mills acquired Pillsbury, took over its regional businesses and its headquarters here.

Doral-based Sean Walker, who worked for the Hershey Co. before joining General Mills in 1989, is a senior vice president at General Mills and the president for Latin America.

General Mills declined the Miami Herald’s request for an interview with its executives at the Latin America headquarters. Information for this article came from General Mills’ public relations department, its website, public documents filed with the U.S. Securities and Exchange Commission, and news reports.

In 2012, General Mills dramatically increased its presence in Latin America — as well as its sales. That year, it acquired a privately held food company in Brazil, Yoki Alimentos S.A. The Brazilian firm has about 5,000 employees and produces and sells snacks, easy-to-prepare meals, grains, beans and seasonings.

Yoki today sells six major product brands in 21 categories throughout Brazil, Latin America’s largest nation. At the time of the takeover, General Mills said that Yoki would more than double the company’s sales in Latin America, to nearly $1 billion.

That prediction was accurate: Brazil is by far the company’s most important Latin American market today.

General Mills’ net sales in the region have shown impressive growth, reaching $1.02 billion dollars in fiscal 2014 (which ended May 25, 2014) for a 38 percent increase in constant currency terms over the previous year. And sales from its new business in Brazil — estimated at about $500 million — accounted for most of this robust regional growth.

The 2012 Yoki takeover in Brazil followed a restructuring that General Mills announced in 2009, when it closed the Brazilian pasta and bread businesses it had inherited from Pillsbury, causing the loss of about 500 jobs.

International sales are a key segment for General Mills, which has production facilities in 16 countries and sells its products in over 100 nations.

In fiscal 2014, net sales were more than $17.9 billion, with international sales of $5.4 billion.

For the first three quarters of fiscal 2015, net sales worldwide were more than $13.3 billion, and international sales $3.9 billion. Both were off from the same period in the previous year.

In addition to its direct operations overseas, General Mills has a joint venture with Nestlé called Cereal Partners Worldwide S.A., which produces breakfast cereals outside the U.S. and markets them in 130 countries. It also has a joint venture with Häagen-Dazs in Japan for ice cream sales in that country. CPW accounts for about 85 percent of the joint-venture revenues, which were $1.3 billion in fiscal 2014.

Throughout Latin America, General Mills brands are purchased by the retail sector (supermarkets, neighborhood stores) and large commercial and industrial customers like restaurants, food chains and other businesses.

In the Caribbean, General Mills brands from the U.S. are widely available through distributors.

In Latin America, not all the brands familiar to consumers in the U.S. are available. However, many of them —manufactured at plants in the region — are on the market.

In Mexico, for example, Nature Valley granola bars and Häagen-Dazs ice cream are popular.

In Argentina, the company sells Pillsbury products and Nature Valley, as well as a wide range of refrigerated and frozen dough products under its local brand: La Salteña.

In Brazil, consumers can buy Häagen-Dazs, Nature Valley and other brands.

The biggest General Mills revenues in Brazil come from the product lines it acquired from Yoki: Yoki and Kitano brands of flour and other basic foods, snack nuts, popcorn, convenient meals, soups, Yokitos snacks for children, Mais Vita soy beverages, Lin Tea, Kitano seasonings, Tori bird food, as well as a co-branded Yoki and Betty Crocker dessert mix.

And in other parts of the region, consumers can buy items like Green Giant frozen vegetables, Betty Crocker products, Yoplait yogurt, Underwood Deviled Ham (called “Diablitos” in Spanish) and a variety of cereals — like Cheerios — made and sold by General Mills’ joint venture with Nestlé and sold under the Nestlé brand.

The writer can be reached at

General Mills Latin America

Business: General Mills Inc. is a global manufacturer and marketer of branded consumer foods sold at retail stores. It also supplies branded and unbranded food products to the food-service sector (restaurants, schools, hospitals, etc.) and to commercial bakeries. The company makes its products in 16 countries and sells them in over 100 countries. Through two joint ventures (Nestlé S.A. and Häagen-Dazs Japan Inc.), it also manufactures and markets cereals and ice cream in international markets. Doral-based General Mills Latin America manages businesses and brand growth throughout Latin America and the Caribbean.

Founded: The company was incorporated in 1928 but traces its origins to 1866, when Cadwallader Washburn built his first flour mills on the banks of the Mississippi River.

Corporate headquarters: Minneapolis, Minn.

Latin America regional headquarters: 8400 NW 36th St., Doral.

Corporate CEO: Ken Powell, chairman and CEO.

Regional leadership: Sean N. Walker, senior vice president at General Mills Inc. and president for Latin America.

Employees: About 43,000 full- and part-time employees worldwide at the end of fiscal year 2014 (May 25, 2014). Since then, however, the company has announced plant closings and layoffs in North America. In Latin America, the company has about 8,000 employees.

Financial results: Net sales in fiscal 2014 were more than $17.9 billion, with international sales accounting for $5.4 billion. Total net sales in the first three quarters of fiscal 2015 were more than $13.3 billion with international sales at $3.9 billion, both down from the same period in the previous year.

Brands: General Mills has a long list of brands and product lines. Many are available in Latin America, including locally produced Cheerios (under the Nestlé brand), Nature Valley, Betty Crocker, Häagen-Dazs, Pillsbury, Green Giant, Yoplait and local brands, like Yoki and Kitano products in Brazil. Under a joint venture with Nestlé called Cereal Partners Worldwide, General Mills cereals are produced outside the U.S. and sold internationally under the Nestlé brand.

Ownership: Publicly traded on the NYSE (Symbol: GIS).


Sources: General Mills, the General Mills website and its annual reports.