Milling & Baking News Corporate Profiles - 2017 - 114

Company Overview

Pinnacle Foods, Inc.
Sales growth comes from Birds Eye, Duncan Hines

innacle Foods in recent years has acquired such brands as Udi's and gardein,
but innovations in two of its older brands
were leading company growth in 2017. The
company launched five products under its Birds
Eye brand, which powered ever-increasing frozen food sales. A Just For One product launch
had sales jumping double-digits for the Duncan
Hines brand.
Pinnacle Foods, Parsippany, N.J., was on
track to meet fiscal-year goals, even after a recall of certain Aunt Jemima items because of
potential Listeria monocytogenes contamination. Following the second quarter ended June
25, the company maintained its guidance for
adjusted diluted earnings per share in a range
of $2.55 to $2.60 for the 2017 fiscal year, although it may be at the low end of the range.
Pinnacle in the six-month period ended June
25 reported net earnings of $41.8 million, or
35c per share on the common stock, which
was down 41% from $70.6 million, or 61c per
share, in the same time period of the previous
year. Six-month sales of $1,510.7 million were
up slightly from $1,510.6 million.
Pinnacle in 2017 reorganized its financial
reporting structure into four segments: Frozen,
Grocery, Boulder and Specialty.
Birds Eye Steamfresh Veggie Made Pasta,

Chief executive officer -
Mark A. Clouse

114 \ October 2017

Birds Eye Veggie Made Mashed, Birds Eye Superfood Blends, Birds Eye Steamfresh Organic
Vegetables and Disney-themed Birds Eye Voila!
all launched in the second quarter. The company said the products were aimed toward the
65% of American families seeking to increase
vegetable intake. Double-digit growth for both
Birds Eye vegetables and Birds Eye meals fueled a 2.5% net sales increase for the Frozen
segment in the second quarter.
"We've grown our Frozen sales 37% over
the past three years, adding nearly four
points of market share and a 67% increase in
distribution while improving profitability for
Pinnacle and retailers," said Mark A. Clouse,
chief executive officer, on Sept. 6 at the Barclays Global Consumer Staples Conference in
Boston.
Sales increased by double-digits for Duncan
Hines, part of the Grocery segment, in the second quarter, led by Perfect Size For One, a single-serve baking system made with ingredients
baked in a mug in a microwave in 1 minute.
"Perfect Size for One has tapped into consumer needs in a number of key areas, including convenience, individuality and portion control while also eliminating the category challenges related to the decline in household size,"
Mr. Clouse said in a July 27 earnings call.
The Boulder segment of Pinnacle saw sales
gains from gardein, Earth Balance and Evol,
but competition in the gluten-free bread category affected Udi's negatively. Pinnacle Foods in
January 2018 plans to launch a new Udi's bread
item as part of a "no compromise" gluten-free
strategy, as in no compromise on taste, health,
convenience or value, said Mark L. Schiller,
chief commercial officer and executive vicepresident, at the Barclays event.
The recall of the Aunt Jemima products,
announced May 5, involved frozen pancakes,
frozen waffles and frozen french toast slices.
Pinnacle on May 8 said it planned to exit
certain low-margin and non-strategic Aunt
Jemima frozen breakfast products. The 16
stock-keeping units covered waffles, french
toast slices and pancakes. CP

Pinnacle Foods, Inc.
net income
in millions

2016

$211.1

2015

$212.5

$248.4

2014

Pinnacle Foods, Inc.
net sales
in millions
2016

$3,127.9

2015

2014

$2,655.8

$2,591.2

Pinnacle Foods, Inc.
share price

per share
$63

$57

$51

$45
Sept. Dec. Mar. June Sept.
2016
2017

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Corporate Profiles

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