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First quarter for General Mills surprises with 38% profit jump

MINNEAPOLIS (AP) — General Mills Inc. surprised Wall Street with a 38 percent jump in its first-quarter earnings on Thursday, but the nation's second-largest cereal maker said it expects higher fuel prices to pressure earnings for the rest of the year.

The maker of Cheerios and Wheaties cereals also said it is on track to recover from a blunder last year when it raised prices faster than competitors.

General Mills shares rose $1.51, or 3.4 percent, to close at $46.19 on the New York Stock Exchange. The stock traded at nearly $54 a share in January.

The Golden Valley-based maker of Yoplait yogurt and Cheerios reported a profit of $252 million, or 64 cents per share, for the three months ended Aug. 28, up from $183 million, or 45 cents per share, during the same period last year.

Revenue rose to $2.66 billion from $2.59 billion a year ago.

Analysts surveyed by Thomson Financial were expecting earnings of 56 cents per share on revenue of $2.63 billion.