Milling & Baking News - February 23, 2010 - 10

Business 

Flowers executives see pricing as
principal challenge for 2010
NAPLES, FLA. - Price and promotion, sales growth and commodities are among the most pressing
financial challenges facing Flowers
Foods, Inc. during 2010, company executives said earlier this month at the
Deutsche Bank Securities Small and
Mid Cap Conference in Naples.
George E. Deese, chairman and chief
executive officer at Flowers, identified
price and promotion as the No. 1 concern throughout the food business in
2010, and said Flowers was not immune.
"Our position is that this year we
will become less dependent on promotions as we maintain our position
of strength in the marketplace," he
said. "Our ability to do so is enhanced
because we have strong brands, innovative products, consistent quality

and superior execution at store level."
In terms of sales growth, Mr. Deese
said Flowers' strategy in 2010 is "to
maintain the strength of our core sales
base, introduce new products and expand our geographic reach for D.S.D.
(direct-store delivery) to deliver
growth that outpaces the industry."
Looking specifically at new products, Mr. Deese said Flowers' new
product pipeline has generated an average of 3.5% in new sales in each of
the past five years, with the increase
even larger in 2009. The company recently introduced Nature's Own Sandwich Rounds and Nature's Own Thin
Sliced Bagels. Mr. Deese said another
new product should hit store shelves
in Florida shortly.
Discussing the company's position

Private equity firm partners with
flatbread company
GREENWICH, CONN. - North
Castle Partners, a private equity
firm with investments in Atkins
Nutritionals and Bora Bora Organic
Foods, has recapitalized Flatout,
Inc. Based in Saline, Mich., Flatout
bakes and markets premium flatbreads, wraps and snack wraps
sold under the Flatout brand to the
supermarket, mass, club store and
food service channels.
Terms of the transaction were not
disclosed.
"Providing consumers with healthy

nutrition options is paramount to
North Castle's mission to build
industry leading companies in
the healthy living and aging market," said Chip Baird, managing partner for North Castle. "We
are proud to welcome Stacey and
Mike Marsh and the entire Flatout team into the North Castle
family."
Flatout is the official flatbread of
the Best Life Diet, a program created by Bob Greene, Oprah Winfrey's
personal trainer. MBN

Ralcorp to expand Lofthouse
operations in Utah
SALT LAKE CITY- Ralcorp Frozen
Bakery Products, a division of St.
Louis-based Ralcorp Holdings, Inc.,
will invest $22.5 million to add food
production lines and jobs at its Lofthouse Foods Inc. baking facility in
Ogden, Utah.
Founded in 1994, Lofthouse Foods
primarily produces cookies that are
sold to the in-store bakeries of major
U.S. supermarkets and mass merchandisers. Ralcorp acquired Lofthouse in 2002.
In addition to its own investment
in the facility, Ralcorp plans to use
financial assistance from the state
10 / February 23, 2010 Milling & Baking News

of Utah's Governor's Office of Economic Development to add production capabilities for waffles and pancakes. The bakery currently produces
more than 70 million lbs of cookies
per year.
"Ralcorp Frozen Bakery Products is pleased to be bringing more
jobs to the Ogden area through this
expansion," said Charles G. Huber Jr., president of Ralcorp Frozen Bakery Products. "Having the
state's and the city's support on
this project reflects our shared interests in strengthening the local
community." MBN

on commodities, Mr. Deese said he's
"real happy" Flowers' strategy on
commodities has worked over time,
and said the company is "staying true
to form" in 2010.
"Our strategy is to be competitive
and to manage our risk," Mr. Deese
said. "We manage our risk by buying
commodities and other ingredients at
the best price and at the right time to
allow us to deliver results in line with
our goals and provide a good value
to our consumers and our customers.
In doing so, we will deliver consistent
earnings growth, which will enhance
share value over time."
Overall, Mr. Deese was upbeat
about the company's prospects for the
upcoming fiscal year.
"We exited 2009 in a better position than we entered it," he said. "Our
bakeries are more efficient, our brands
and product mix stronger and our
geographic reach broader." MBN

Aunt Millie's
introducing degradable
inner bread wrap
FORT WAYNE, IND. - Aunt Millie's, a
family-owned bakery company, has made
the inner wrap on its Aunt Millie's Hearth
Breads degradable. The change will affect
12 bread varieties.
In December, the company said it converted the inner wrap for all its Hearth
Breads to EnviroSafe 502E degradable OPP film, which decomposes completely
into CO2 and biomass
over time when exposed
to sunlight, moisture and
heat.
"Degradable inner
wrap costs 50% more
than non-degradable
film, but we thought
it was worth it for the
sake of the environment," said Melissa
Dunning, marketing
director for Aunt Millie's. "Aunt Millie's
wants to lead the way
in sustainable bread
packaging."
Ms. Dunning said
there will not be an increase in the suggested retail price of the bread.
The outer bags of all Aunt Millie's bread
varieties are made with No. 4 LDPE plastic, which is recyclable, but not accepted
for recycling in all areas. MBN

bakingbusiness.com / world-grain.com

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Milling & Baking News - February 23, 2010

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