Yes, there is sugar in the milk that is in the mix, so it can't be classed as "sugar free" but if they don't add any additional sugar, then it is "no sugar added". The mainline instant breakfast does have sugar in there (second ingredient after nonfat milk and before maltodextrin) but the no sugar added version will have some other sweetener in there instead - sucralose, aspartame, sugar alcohols, etc.
"No sugar added" is a newish label that is working its way into the nutrition label, and overall is a good thing, as it is the added sugar that is typically the biggest problem. A package of frozen strawberries can't be said to be sugar free, as the strawberries have sugar naturally occurring in them, but they can be "no sugar added" if all they are are strawberries that have been frozen.
I have seen some studies that indicated that on the order of 70-80% of the packaged goods on the shelves have some form of added sugar in them, This is distinct from intrinsic sugar, or sugar that is naturally occurring in foods - milk, fruit, vegetables - almost anything grown in the ground - which is typically much less of a problem as it is usually bound into the fiber of the plant and more slowly absorbed than the added free sugar.
Is the instant breakfast a recommended product for your program? Typically it is not as it is more of a "meal replacement" product that is moderate in protein as opposed to the protein shakes that are primarily protein, (20-30g protein per serving vs. about 5g for instant breakfast. Usually we are looking for high density protein early on as we can consume so little for a while. That said, I did (and do still) mix instant breakfast with protein powder as I was not having any big problem with protein intake, even early on, and chose to blend in the instant breakfast to give a better overall nutritional profile than just the protein powder alone. There is no right or wrong answer, but just a consideration, particularly if one is struggling to get in their requisite protein at the start.
Good luck in your coming adventure!