Food giant General Mills has been investing in capabilities to keep its operations as buttoned-up as possible in the midst of pandemic volatility, CFO Kofi Bruce said at the Consumer Analyst Group of New York (CAGNY) 2021 Conference last week. 

"Higher volume puts pressure on our supply chain," he told Yahoo Finance in a follow-up interview late last week. "The need for external supply chain capacity to augment our internal capacity has put additional cost pressure on the business."

Bruce said the trade-off for higher operating costs is offset by the greater operating leverage the company gets out of its assets. 

"We run about 4% productivity, on average, annually, sometimes a little more," he said. "And that offsets most of it. We were looking only for one to two points of price realization in 2019, and we got about two. So, we were able to more than offset that, and deliver some modest margin expansion in an inflationary environment."

Spot markets have also been key for some of the company's commodity inputs that impact things like packaging and freight and certainly grains. "If you think about the sizing and size versus price relationship in the category, those are all levers you can use to protect prices and offset inflation in an inflationary environment," he said. 

Eye on debt

Bruce, who has been CFO of the company behind Yoplait, Pillsbury and Cheerios for less than a year, has been tasked with lowering the company's debt, steering new environmental, social and corporate governance (ESG) efforts, and offering guidance to shareholders at a time with little to no predictability. 

"Our job is to be competitive regardless of demand," he said, adding that the company's philosophy has driven him and his team to focus on maintaining margins regardless of the landscape.

That mission is complicated by the continued economic uncertainty resulting from the coronavirus pandemic. 

"I will certainly be the first to concede we're in an environment of high uncertainty," he told Yahoo Finance. "As we've thought about this year and frankly, just even the quarter ahead, we have been governed by a philosophy that the demand environment will be what it will be."

Looking ahead, Bruce said, the company has turned a corner in 2021, and he and his team feel confident forecasting that demand will remain elevated "for at least the next quarter."

"We're comfortable giving an affirmation of guidance that has us expecting to deliver a flat margin profile on strong continued growth," he said.