A Baby Boomer’s  Pantry We’re innovating to meet  consumer needs. U.S. Household Penetration for  Our Categories (percent of households purchasing) We’re focusing our product innovation  efforts on the needs of consumers, par- ticularly groups that will drive our sales  growth in the years ahead. The baby  boomers, born between 1946 and 1964,  are the largest age demographic in the  U.S., representing one-quarter of the pop- ulation. It’s projected that adults ages 55  and over will represent more than 1 billion  consumers worldwide by 2015. Millennials  are between the ages of 16 and 33, and  represent the next boomlet. Nearly two- thirds of births in the U.S. today are to  millennial moms. Multicultural consumers  are the fastest-growing U.S. demographic,  with Hispanic consumers leading that  growth. Over the next five years, more  than 85 percent of the projected increase  in the U.S. population will come from  multicultural groups.  Many baby boomers look for foods  that enhance their health and vitality. Our  whole grain cereals are a great fi  t with  that interest. Retail sales for the  Cheerios franchise have grown at a 7 percent  compound rate over the past three years  due in part to the cholesterol-lowering  benefi ts of  Honey Nut Cheerios  and weight  management credentials of  MultiGrain  Cheerios . In January 2010, we introduced  Chocolate Cheerios , which is made with  whole grain and is on track to become our  biggest new product launch in the past  decade.  Betty Crocker  gluten free dessert  mixes received tremendous consumer  We compete in attractive food categories.  Each of these categories generates more  than $1 billion a year in retail sales. They’ve  gotten that big because many U.S. house- holds purchase and enjoy these foods. Source: ACNielsen Panel Data, 52 weeks ended 2/27/10 Our product portfolio  includes a wide vari- ety of foods that fi t a  healthy lifestyle, from  whole grain cereal  to reduced calorie  snack bars. We also  have many options  for a convenient meal  with  Progresso  soup,  Green Giant  vegeta- bles, and  Betty Crocker side dish and des- sert mixes. Ready-to-eat Cereal Frozen Vegetables Mexican Aisle Products Dessert Mixes 93 82 79 77 Frozen Hot Snacks 76 Dry Packaged Dinners 75 Refrigerated Dough 70 Refrigerated Yogurt 79 Grain Snacks 68 Ready-to-serve Soup 64 7 Annual Report 2010