Food Business News - January 26, 2016 - (Page 18)

Hain Celestial under pressure in the U.S. ORLANDO, FLA. - The widespread shift of such specialty items as sustainable, organic, non-G.M.O. and gluten-free to mainstream grocers is putting pressure on the Hain Celestial Group, Lake Success, N.Y. The company has been a leader in bringing specialty products to the traditional retail marketplace, but as companies like General Mills, Campbell Soup Co. and Pinnacle Foods continue to elbow their way into the market, Hain is facing an increasing level of competition that is challenging its U.S. results. The company is no longer simply focused on growth in the United States. In addition to acquisitions, the company is looking at improving efficiencies and even divesting itself of some underperforming brands. During the first quarter of fiscal 2016, ended Sept. 30, 18 FOODBUSINESS NEWS ® 2015, Hain's U.S. business sales fell nearly 5% to $331.2 million. The U.S. results stand in contrast to the company's overall firstquarter results, which saw net income rise 66% to $31,302,000, equal to 30c per share on the common stock. Company sales rose 9% to $687,188,000 during the quarter. The rise in sales was attributable to three acquisitions that were made during 2015, according to the company. " ... We had some one-offs in the area of inventory in regard to the Wal-Mart clean floor policy, unprofitable programs that we chose not to repeat, and of course, coming back from our MaraNatha recall," said John Carroll, chief executive officer of Hain Celestial North America, about the U.S. business on Jan. 12 during a presentation at the ICR Conference in Orlando for investors. When the one-time issues are stripped away, Mr. Carroll said it becomes clear where Hain Celestial is challenged in the marketplace - tea and snacks. "Those are things that we are addressing and in each instance we've got a pretty robust program to address it," he said. "In Celestial (Seasonings), for example, we are, at this point it's key to us that we get our users back and, more importantly, that we get our unit share so that it's flat or up slightly by the end of the season. And so, as a result, we are going to promote our way through the season. "In terms of snacks, we had a great program with Wal-Mart last year. With their clean floor policy they chose not to repeat it." Mr. Carroll said Hain Celestial has worked with Wal-Mart to address the issue and, starting Feb. 1, the company's snack products will start showing up in some Wal-Mart stores. "On each of these challenges we've put together initiatives that we are seeing starting to take hold and to turn some of the consumption declines around. And then from there ... we're going to start to invest more against the consumer on some of our key brands because (the) category is competitive." An issue raised during the ICR presentation is that with wellknown companies like General Mills and Campbell striving to grow their share of the specialty foods market, Hain may not have the brand name recognition needed to remain competitive. But Mr. Carroll pushed back on that notion. " ... Here's what's changing for the major C.P.G.s coming into the industry," he said. "What they are doing is, instead of trying to use one of their core bands, they are actually buying a natural and organic brand. ... (Those) January 26, 2016

Table of Contents for the Digital Edition of Food Business News - January 26, 2016

Food Business News -- January 26, 2016
Global turmoil clouds Unilever’s outlook
D.O.J. toughens stance on foodborne illness accountability
Dairy Business News - Competition spurring yogurt innovation
Table of Contents
Web Contents
Editorial - Food uncertainty in zero-rate era end
Jelly Belly sees opportunities in organic
Dang Foods adds onion chips to portfolio
Enjoy Life Foods on the cusp of enjoying greater growth
Bone broth debuts in a K-cup format
Brynwood Partners to acquire Sunny Delight Beverages
Krave founder in new food endeavor
A long road ahead for Chipotle
Oberto Brands to streamline operations
Hain Celestial under pressure in the U.S.
Inventure expands in frozen food
Kroger remains Wall Street darling
Wal-Mart to close 269 stores
Market Insight - Sugar intake in the spotlight
Ingredient Trends - Savory Flavors sliding into sweet applications
Ingredient Innovations - Egg replacer revelations
U.S.D.A. detects avian influenza in turkeys
New Food Products
Ingredient Market Trends - Iran likely to remain market largely lost to U.S. wheat
Ingredient Markets
Supplier Innovations and News
Ad Index
Food Business in the News

Food Business News - January 26, 2016