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GENERAL MILLS ACCELERATES PRODUCTIVITY INITIATIVES, ANNOUNCES RESTRUCTURING CHARGE

 MINNEAPOLIS, May 24 /PRNewswire/ -- General Mills (NYSE: GIS) announced that it is accelerating productivity improvement efforts to help offset the adverse impact of expected new federal tax and health care policies. These productivity improvements include restructuring actions at consumer foods manufacturing facilities as well as restaurant unit closings. As a result, the company will take a fourth-quarter restructuring charge of $45 to $50 million (28 to 30 cents per share).
 When completed, these actions are expected to produce an overall positive cash flow and ongoing cost savings, with $15 million in after- tax savings (9 cents per share) expected in fiscal 1994. With the exception of severance costs for the employees who cannot be placed at other company locations, most of these charges are not cash items.
 Actions to improve efficiencies in consumer foods manufacturing include accelerating the move to high performance work systems. Currently, 64 percent of the company's production lines incorporate high- performance work systems, and the productivity of these lines is significantly higher than the company average. These systems are also providing increased capacity in our current facilities and offer the potential to meet future demand with lower capital investment.
 Restructuring actions in Restaurants will include closing 31 of the company's 1,075 units in North America. Approximately half of the closings are in economically depressed locations in Canada, which are in aggregate unprofitable. The U.S. closings are primarily located in multi-unit market areas where the company believes elimination of units will lead to material improvement in overall profitability and investment return in the remaining restaurants. Twenty-seven of the restaurants to be closed are Red Lobsters.
 Additional detail will be reported in General Mills' release of fiscal 1993 results on June 29, 1993. The year-end figures will also include previously announced charges of $10.3 million (6 cents per share) related to General Mills' share of streamlining costs and tax implications associated with the formation of Snack Ventures Europe (SVE), the company's continental European snack food venture with PepsiCo Foods International.
 General Mills Chairman Bruce Atwater said the company's fourth quarter operating performance is expected to be on target as are the expected fiscal 1993 results before unusual items. "General Mills' overall financial results, including unusual items, will represent another year of record sales, earnings, and earnings per share," he said.
 -0- 5/24/93 R
 /CONTACT: (Analysts) Dean Belbas, 612-540-2443 or Ted Blood, 612-540-2256; or (Media) Peter Spokes, 612-540-7521, all of General Mills/
 (GIS)


CO: General Mills ST: Minnesota IN: FOD SU:

437 05-24-93 09:04 EDT DS -- MN003R -- 1611 05/24/93 10:36 EDT
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Publication:PR Newswire
Date:May 24, 1993
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