To Our  Shareholders Ken Powell Chairman and Chief  Executive Offi cer Fiscal 2010 was an exceptional year for General Mills.  We achieved broad-based sales growth for our  leading food brands in markets around the globe.  Our earnings increased at a strong double-digit  rate. And we made significant investments in product  innovation, media support and selling capabilities  that we believe will help drive continued growth for  our company in 2011 and beyond.  lines we divested and index pricing tied to wheat markets that were  below prior-year levels. However, our sales grew in targeted  foodservice channels, outpacing industry trends. And we posted  good performance on a constant-currency basis across our  international operations. Net sales grew 1 percent as reported. However, 2010 was a 52-week  fiscal year compared to 53 weeks in fiscal 2009. We also divested  some product lines in 2009. These differences reduced our 2010 sales  growth by 3 percentage points. Segment operating profi  t grew  8 percent. And our earnings per share (EPS) rose 18 percent to  $2.24. This EPS fi gure reflects the two-for-one split of General Mills  stock with a record date of May 28, 2010. It also includes two  items that affect the comparability of our results year-over-year.  Those items were mark-to-market valuation of certain commod- ity positions and a tax charge taken in the fourth quarter to  reflect the impact of recent federal health care legislation. Excluding  these items, EPS was $2.30, up 16 percent from 2009 earnings  of $1.99 per share excluding certain items aff  ecting comparability.  We believe this represents very strong financial performance in a  challenging operating environment.  We recorded sales gains across our businesses. In our $10 billion  U.S. Retail segment, every division increased sales, despite one  less week in this year’s results. In our Bakeries and Foodservice  segment, reported sales declined due to the absence of product  We managed our input costs well, realizing a 3 percent decline  in supply chain costs from the previous year’s levels. In addition,  we generated significant cost savings with our Holistic Margin  Management (HMM) efforts. HMM is our companywide disci- pline to identify and eliminate costs in our businesses that don’t  add value for the consumer. These cost savings initiatives,  together with strong plant performance and input cost defl  ation,  resulted in significant gross margin expansion in 2010.  Consequently, we were able to invest at above-planned levels in  * Does not include the impact of foreign currency translation. See page 87 of our 2010 Annual  Report for discussion of non-GAAP measures. 2010 Net Sales % Change Operating Division/Segment  (52 weeks compared to 53 weeks) Snacks +6 Big G Cereals  +5 International Segment*  +3 Small Planet Foods  +3 Yoplait +2 Pillsbury USA  +1 Meals +1 Baking Products  +0 Bakeries and Foodservice Segment  -14 Broad-based Sales Growth General Mills 2