Lee Egerstrom, Bright spot for General Mills, St. Paul Pioneer Press, September 28, 2004.

Food manufacturer receives award for its advertising support of family-friendly TV

A week after absorbing disappointing first-quarter financial results, General Mills shareholders probably were in the mood for some good news Monday at the company's annual meeting.

The bright spot was the announcement that the Los Angeles-based Parents Television Council presented the food company its Seal of Approval for advertising on family-friendly programs.

Lara Mahaney, director of external affairs for the Parents Television monitoring group, used the annual meeting's question-and-answer session to present General Mills its award and thank the company for advertising on programs that are "free from violent or negative content and that are safe for the entire family to view."

The Parents Television Council said it has a million members across the nation and selects a few family-friendly corporations to salute each year.

On business topics, Steve Sanger, chairman and chief executive, warned shareholders that General Mills expects commodity costs will be $165 million more in the current 2005 fiscal year than a year ago, even though commodity costs are moderating after hitting modern highs late in the past fiscal year. Food manufacturing companies in general have struggled with rising commodity costs that include raw materials such as chocolate as well as grains and vegetable oils.

Sanger also said there was nothing new regarding an ongoing Securities and Exchange Commission investigation of General Mills' accounting practices. He added that there was no significance to the SEC's approval of a shelf registration announced last week except that Diageo, the London-based drinks company that sold Pillsbury to General Mills, is now free to sell all or part of its shares it received as partial compensation in the Pillsbury sale.

A more pointed question came from a shareholder who attacked executive compensation practices at corporations and wanted to know where Sanger fits into the mix.

Sanger bumped the question to board member Livio "Desi" DeSimone, the former 3M Co., chairman and chief executive, who heads General Mills' compensation committee. Sanger is below the average of peer group food company executives in salary, DeSimone said, but his bonus and options compensation is above the group's average if General Mills reaches profit targets for shareholders.

A Pioneer Press executive compensation survey published in May found Sanger's salary didn't make the top 10 list of Minnesota public companies, although the value of new options eventually could nudge him into the top 10 in total compensation.

General Mills stock closed down 20 cents in Monday trading, at $44.89 per share, on a day in which most food company stocks fell on Wall Street.