Milling & Baking News - January 20, 2015 - 23

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guidance and appeared surprised by
the resurgence of the Hostess snack
cake business, which resumed operations in the middle of 2013. During
the year, Flowers continued to work
to integrate Hostess bread baking assets it acquired in 2013. Additionally
the company sold certain plants acquired in the Hostess transaction, including baking plants in Sacramento,
Calif., and Biddeford, Maine.
Shares of the nation's two leading
donut shop companies also underperformed in 2014. Shares of Krispy
Kreme Doughnuts, Inc., Winston-Salem, N.C., eked out a 2% gain in 2014,
negligible when measured against
the 106% jump in 2013. Krispy Kreme
shares had been among the strongest
within the index over a number of
years, chalking up gains of 47% in
2012, a decline of 6% in 2011 and a
jump of 137% in 2010. In 2014, shares
fell 15% on a single day - June 3
- after the company lowered its

full-year outlook because of weather-related difficulties during its first
quarter and higher-than-expected
costs in connection with a new enterprise resource planning system and
executive management succession.
During the year, Tony Thompson was
named as president and c.e.o. to succeed Jim Morgan.
Shares of Dunkin' Brands Group,
Inc., Canton, Mass., peaked at just
above $52 per share in March and
declined fairly steadily afterward
with a sharp fall at year end. The late
decline followed updated guidance
for 2015 that included a forecast of
U.S. same-store sales growth of 1% to
3%, versus the company's long-term
target of 2% to 4%. The cautionary
guidance was attributed in December by Nigel Travis, the company's
chairman and c.e.o., to "continued
pressure on the consumer and decelerating sales of packaged coffee in
our restaurants." Dunkin' shares in

Stock Market Review

2014 were down 12%, versus a 45%
jump in 2013.
The widest decline among grainbased foods shares in 2014 was 19%
by Bridgford Foods Corp., Anaheim, Calif. The share price tumble
continued an up-and-down pattern
for the frozen dough product company. In the nine months ended July
12, 2014, Bridgford sustained a loss
of $3,429,000, versus net income of
$1,814,000 during the first three quarters of fiscal 2013.
Also down fairly steeply during
the year was Post Holdings, Inc., St.
Louis, down 15%. Like Bridgford,
the Post share price drop followed a
strong performance in 2013, up 44%
for Post. In October, Post completed
the purchase of the PowerBar snack
bar business from Nestle S.A. for $150
million. Also during the year, Post acquired Michael Foods, a producer and
distributor of eggs, potatoes and dairy
products for $2.45 billion. MBN

While still strong, foreign grain-based foods
performance slips some during 2014

or the past two years, grain-based
foods companies outside of North
America have enjoyed strong
returns. While strength was still evident
in 2014, many more companies posted
year-over-year share price declines than
in 2013. Of the 40 companies tracked by
Milling & Baking News, 25 recorded yearover-year increases in share price while
15 posted decreases. By comparison,
32 companies posted year-over-year
gains in 2013, and 8 finished lower. The
companies that did finish higher also
did so at rates quite smaller than in 2013.
Only 4 of the 25 companies posted gains
exceeding 30% during 2014, down from
13 such companies in 2013.

On the London Stock Exchange,
Associated British Foods finished the
year at 3153p, up 29% from 2445p
in 2013 and up 102% from 1564p in
2012. A.B.F. said it sustained a decline
of 3% in revenue and 1% in adjusted
operating profit in fiscal 2014. Charles
Sinclair, chairman of A.B.F., said in the
company's 2014 annual report that
the financial year was characterized
by price deflation in many food
commodities and a strengthening of the
Pound sterling against the company's
major trading currencies. He also said
A.B.F.'s yeast and bakery ingredients
bakingbusiness.com / world-grain.com

business, AB Mauri, is achieving a
strong turnaround from the challenges
of recent years with the promise of
further improvement to come.
Carr's Milling Industries P.L.C.
closed at 1705p, up narrowly from

1687p in 2013 and compared with
1055p in 2012 and 790p in 2011. Tim
Davies, chief executive officer of Carr's,
noted in the company's 2014 annual
report that the company's Kirkcaldy
mill - commissioned in 2013 - is
meeting all expectations with regard to
performance and reliability.
"The benefits of the new mill
have been delivered from improved
operational efficiency, and the
commercial benefits derived from
increased customer confidence in our

ability to produce high quality flour,
milled to the highest standards of
product integrity," he said.
Tate & Lyle P.L.C., the global sweetener
company, had a 52-week low of 551.5p
and a high of 813p, but ultimately ended
the year down 25%, closing at 603p. In
November, executives at the company
said Tate & Lyle will seek to develop a
more integrated demand, supply and
financial forecasting capability. The
company will reassess manufacturing
and supply chain network flexibility
and wants to ensure the company has
appropriate manufacturing capacity
headroom and inventory capabilities
across the world. An upgraded
information technology platform in
Europe, North America and Singapore
already is assisting the global supply
chain. The company also has committed
to £100 million in incremental capital
spending, which will support specialty
food ingredients growth.
Premier Foods, the U.K.'s largest
food producer, finished 2014 at 32p,
down 74% from 125p in 2013. In
September, Premier Foods announced
a reorganization of its commercial
structure creating three new strategic
business units to strengthen focus on
its major growth opportunities. The
Milling & Baking News January 20, 2015 / 23

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Milling & Baking News - January 20, 2015

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