BEMA - June 2018 - 99

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IN THIS ISSUE: EGG INGREDIENTS * CRACKER TECH * MINIMIZING WASTE

FEBRUARY 27, 2018
AUGUST 2017

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SERIOUSLY DELICIOUS DONUTS
Rachel Crampsey innovates with ﬂavor
INVESTING IN YOUR IMAGE
Inventive display cases set the tone

Story on Page 26

LATE NEWS

Bimbo N. American
income up in 2017
MEXICO CITY - Strong sales of
its snack products and core brands
helped Bimbo Bakeries USA achieve
higher operating income in 2017.
Operating income of the North
America business of Grupo Bimbo
S.A.B. de C.V. was 7,701 million pesos ($415 million) in the year ended
Dec. 31, up 8% from 2016. Net sales
were 137,662 million pesos ($7,411
million), up 1.8%. The improvement
in profitability was attributed principally to non-operating factors: a
modest non-cash gain related to the
value of multi-employer pension
plan liability and lower North American restructuring expenses. "(Higher

The 40-year evolution

Continued on Page 8

APRIL 2018

SNAXPO

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STOCK MARKET ANALYSIS

WASHINGTON - The price of
all wheat received by farmers in
November averaged $4.73 a bu, up
9c from October and up 85c from
November 2016, the U.S. Department
off A
Agriculture
said
28
i l
id in
i its
i Dec.
D
Agricultural Prices report. Durum
averaged $6.53 a bu, up 12c from
October and up 53c from November
2016. Spring wheat other than durum
averaged $5.78 a bu, up 23c from
October and up $1.30 from a year
earlier, with hard red spring at $5.89 a
bu, up 16c and up $1.35, respectively.
Winter wheat averaged $4.07 a bu,
down 10c from October but up 66c
from November 2016, with hard

The knowledge authority for development, production,
packaging and distribution of grain-based foods.

BAKING
Science & Technology

Information Resources, Inc., a Chicagobased market research firm.
Enter flavor innovation opportunity.
"The range of flavors that are available have expanded beyond the traditional apple, berries, cinnamon,
honey, cocoa, and maple to new flavor
combinations that take inspiration
from other foods and beverage categories," said Catherine Hogan, senior
category manager, sweet goods, North
Continued on Page 20

CSM Bakery rebranding North
American operations under Brill
ATLANTA - CSM Bakery Solutions has
unveiled plans to rebrand its North American operations under the Brill brand, a
move the company's top executive believes will help revitalize one of baking's
"iconic and respected brands." CSM will
begin operating under the Brill brand immediately in North America, while no
changes are planned for the company's
business operations in Europe.
"The Brill brand was founded in 1928,

and we thought there would be no better
way to honor its 90-year heritage than to
make it CSM's flagship brand in North
America," said Marianne Kirkegaard,
president and chief executive officer.
"We see great potential in fully leveraging the power of this brand, and we're
confident our customers and colleagues
will feel the same way."
Harry C. Brill founded the company
90 years ago with a vision toward creating products that would improve
the bakery experience. The brand has
grown to become one of the key players in cakes, icings, glazes and toppings,
and Ms. Kirkegaard said CSM intends to
continue the brand's legacy.
"Our goal is to build on Brill's legacy
and ambition of creating one-of-a-kind

E.J. PYLER
AND L.A. GORTON
SOSLAND PUBLISHING COMPANY

IN THIS ISSUE: EMULSIFIERS * FLATBREAD TECH * MILLENNIALS

March 2018

DECEMBER 2017

A SOSLAND PUBLICATION

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packaging and distribution of grain-based foods.

THE GLOBAL ISSUE:

bakery cafes
reimagined

Stephens, Inc., New York; Kevin V. Dreyer, co-chief investment officer, value,
Gabelli Funds, New York; and Nicholas
Fereday, senior analyst, consumer foods,
Rabobank, New York.
Each of the analysts cited changes in
food retailing as a key market influence
in 2017, notably the acquisition last year
of Whole Foods Market, Austin, Texas,
by Amazon.com, Inc., Seattle.
"A lot of (the food sector weakness)
has to do with the upheaval in retail -
Aldi /Lidl and Whole Foods/Amazon,"
Mr. Hundley said.
Food companies and retailers will adjust
j

PRETZELS, INC.

EUROPAIN EXCLUSIVE
Pascal Rigo breaks the mold in France

BEACON
CO OOF

HEALTHY BREADS
Leaders share their visions of key trend
BEVERAGE PROGRAMS
Improve your margins with coffee

FROM DISASTER TO
STARTUP IN RECORD TIME

LEADERSHIP

Continued on Page 20

2017 OPERATIONS

General Mills reinforces commitment
to competing in cereal
MINNEAPOLIS - Although scanner
data suggest the overall ready-to-eat
cereal category is down 2% to 3% yearover-year, General Mills, Inc. likes the
way it's competing in the sector right
now, said Jonathon J. Nudi, senior
vice-president and group president of
North America Retail.

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SNAC WORLD SPECIAL EDITION

Reversal of fortune seen in food-sector
share prices going into 2018
©RAWPIXEL.COM - STOCK.ADOBE.COM

KRISPY KREME DOUGHNUTS, INC.

November all wheat
average price increases

FOURTH EDITION

Continued on Page 10

official show issue

IN THIS ISSUE: SWEETENERS * INGREDIENT HANDLING * OVENS

Story on Page 26

flurry of flavor activity has taken place in the ready-to-eat cereal category. Recent launches
include Kellogg's Chocolate Frosted
Flakes and Kellogg's Cinnamon Frosted Flakes, Blueberry Chex, and Great
Grains Coconut Almond Crunch.
Yet cereal formulators could become even more imaginative. Tropical
flavors like mango could join berry
and apple flavors in the cereal aisle. A
spicy flavor such as chili pepper could
pair with honey in a sweet-heat combination. Candy-like flavors might
interest children, and varietal flavor
profiles like Tahitian vanilla might
appeal to adults.
Cereal could use a boost in sales as
it faces morning competition from yogurt and bars as well as breakfast sandwiches sold at restaurants. Dollar sales
in the R.-T.-E. cereal category totaled
$8,599,708,672 in the 52 weeks ended Nov. 5, 2017, down 2.3% from the
same period a year ago, according to

PHO
UPDATE

JANUARY 2, 2018

LATE NEWS

A future for flavor in cereal

Argentine grain,
oilseeds enduring driest
year since 2009

OTIS
SPUNKMEYER

BE FINANCIALLY FIT
Lessons from two progressive owners

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Dunkin' goes simple
while Krispy Kreme
finds brand partners

VOLUME I: Fundamentals & Ingredients

Food Ingredient Solutions

WEATHER OUTLOOK

elevate your
product line

THE NEWS WEEKLY OF GRAIN-BASED FOODS

KANSAS CITY - After years of food
industry share outperformance relative
to the broader stock market, the sector's
reversal in 2017 was extraordinarily severe, said Brett M. Hundley, Vertical
Group, Richmond, Va.
As a result, Mr. Hundley said food
sector shares are valued far differently
at the start of 2018 than was the case
a year ago or several years earlier. Mr.
Hundley was one of several food sector
analysts interviewed by Milling & Baking
News about the stock market outlook for
the new year in the food sector generally
and grain-based foods in particular.
"Since 2006, the packaged foods subindex has always traded at a premium
to the market," Mr. Hundley said. "Over
the past two to three years the multiple
has been 1.4 to 1.5 times. Now it is sub1. I'd never seen that. It just shows the
rotation toward industrials and tech and
away from these staple names."
Other analysts offering a market outlook were Farha Aslam, managing director,

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THE DESIGN ISSUE:

2017

DONUT UPDATE

THE NEWS WEEKLY OF GRAIN-BASED FOODS

April 2018

EXECUTIVE OF THE YEAR

"When you look at our performance
through the first half, our change in
trend is pretty significant, and nearly
70% of that change is from baseline
sales," Mr. Nudi explained during a Dec.
20 conference call with analysts to discuss second-quarter results. "So again,
it's really better innovation and better
marketing that's driving our results in
the category. And that's really been the
recipe for success in the category over
the long term."
Mr. Nudi said General Mills is committed to continuing to build strong brands
and is focused on innovating more aggressively. He said the company is

CONGRATULATIONS BEMA ON 100 YEARS.
HERE'S TO THE NEXT 100.
Continued on Page 8

iba
Preview

TreeHouse
Foods

Continued on Page 11

IN THIS ISSUE: EXTRUSION * INGREDIENT TRACEABILITY * MAINTENANCE
FEBRUARY 2018

IN THIS ISSUE: MIXING * DAIRY * PRETZEL TECH

THE NEWS WEEKLY OF GRAIN-BASED FOODS

MARCH 13, 2018

THE NEWS WEEKLY OF GRAIN-BASED FOODS

MARCH 27, 2018

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OCTOBER 2017

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INDUSTRY ACTIVITIES

Despite larger crop, smaller wheat
supplies anticipated in 2018-19

The knowledge authority for development, production,
packaging and distribution of grain-based foods.

Purchasing Seminar
focusing on freight,
other key issues
Story on Page 12

LATE NEWS

Smucker considering
sale of baking brands
ORRVILLE, OHIO - J.M. Smucker
Co. is considering a potential sale
of its baking brands, which include
Pillsbury, Robin Hood flour and cereal, and Martha White baking mixes,
according to a March 7 report from
Bloomberg. Citing people familiar
with the situation, Bloomberg said
the Orrville-based company is working with an adviser to weigh its options for the unit. Reports suggest the
unit could attract a purchase price
of around $700 million. Responding to the reports, Maribeth Burns,
a spokesperson with Smucker, said
the company does not comment
on rumor or speculation. "We are

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Springissue HEARTHSIDE
and VSI

The knowledge authority for development, production,
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12 WINNING PROMOTIONS
14 INNOVATIVE PRODUCTS

GOING

Long-term thinking
bears fruit for
Rogers Foods

GLOBAL

The U.S.D.A. will provide its first official
projections for 2018-19 U.S. and world
wheat supply and demand in its May
World Agricultural Supply and Demand
Estimates report. The May projections
will be informed by survey-based wheat
area forecasts that will be issued on

Story on Page 31

LATE NEWS

Nisshin acquires
flour mill in Thailand

Continued on Page 22

TOKYO - Nisshin STC Flour Milling Co. Ltd., the Thai subsidiary
of Nisshin Seifun Group's Nisshin
Flour Milling Co., has acquired a
flour milling plant from Pacific Flour
Mill Co., Ltd. in Thailand for $16.8
million. With the acquisition, Nisshin STC Milling more than doubled
its current production capacity to
630 tonnes per day, Nisshin said.
Nisshin noted that the recently
purchased plant, which has production capacity of 350 tonnes per
day (wheat equivalent), is located
near Thailand's largest port, Laem
Chabang. Nisshin Flour Milling established Nisshin STC Milling and

Strong financial results trigger
rally in Hostess Brands shares
KANSAS CITY - Riding the back of
strong fourth-quarter results exceeding Wall Street expectations, Hostess
Brands, Inc. achieved earnings and
sales growth in the year ended Dec. 31,
2017. Cheered by the gains after disappointing results earlier in the year,
Hostess Brands shares surged more
than 10% in trading March 1.
Hostess net income in the year ended
Dec. 31 totaled $223,897,000, equal to

Continued on Page 8

Wenner
Bakery

$2.26 per share on the common stock,
compared with earnings of $57,211,000
in 2016, which included 10 months before the company's initial public offering. Sales in 2017 were $776,188,000, up
26% from $615,588,000.
Results in 2017 included a one-time
gain of $163.1 million related to tax rate
reductions enacted late in the year. Adjusted earnings per share for the year
were 63c, up 5% from the year before.
Adjusted EBITDA in 2017 was $230.2
million, equating to 29.7% of revenue.
Adjusted EBITDA was up 7% from 2016.
"We are pleased with our strong finish to the year," said William D. Toler,
president and chief executive officer
of Hostess. "We were able to capitalize on the momentum provided by our

Continued on Page 8

feature

MINNEAPOLIS - Efforts to mitigate
rising freight costs, tightening of expenditures and "targeted strategic revenue
management actions" are among steps
General Mills, Inc. is taking in the wake
of a difficult third quarter of the company's 2018 fiscal year.
Net income in the third quarter ended
Feb. 25 was sharply higher than in the
third quarter last year, boosted mostly
by benefits attributed to the Tax Cuts
and Jobs Act (estimated at $504 million).
Adjusted operating profits in the quarter
declined.
"Our primary goal this year has been
to strengthen our top-line performance
while maintaining our efficiency,"
said Jeffrey L. Harmening, chairman
and chief executive officer. "While I'm
pleased that we're delivering on the first
part of that goal, with strong consumer
marketing, innovation, and in-store execution leading to a second consecutive

January 2018

JANUARY 16, 2018

Ingredion, Cargill and ADM expand through acquisitions and added capacity

ngredient suppliers are diversifying
their starch sources while starch innovations are centered on elements
within baked foods, including sauces
in frozen food meals and fruit filling in
desserts. Ingredion, Inc., Cargill and Archer Daniels Midland Co. all invested in
their starch capabilities recently.
Ingredion, Westchester, Ill., in 2017 acquired the rice starch and rice flour business from Sun Flour Industry Co. Ltd.,

40th Annual
Purchasing Seminar
JUNE 4-6, 2017 / KANSAS CITY, MO

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BUSINESS. ACCURACY. KNOWLEDGE. EXECUTION.

STOCK MARKET REVIEW

WASHINGTON UPDATE

Modest gain extends grain-based
share streak to nine years

What will 2018 bring?
Story on Page 26

LATE NEWS

Hearthside Food may
be on the block
THE CONSUMER ISSUE:

the future of
whole grains
THE VERMONT CONNECTION

Bakers, farmers, breeders work together
STONE MILLED

Elmore Mountain Bread branches out
SPRING CAKES

Cake decorators share design trends

Continued on Page 20

Investing in starch sources

which is based in Banglen, Thailand. Ingredion now operates four manufacturing facilities in Thailand.
"Rice is an on-trend ingredient," said
Pat O'Brien, senior manager, marketing of Wholesome Springboard for Ingredion and based in Bridgewater, N.J.
"It is non-G.M.O., hypoallergenic and
gluten-free. Plus, its superior functionality makes it ideal for a variety of uses,
including baby foods, dairy products,
snacks and gluten-free bakery."
Rice starch or flour may work in tandem with starches and flours of many
bases, including potato, corn and tapioca, he said.
"The base material can contribute to
functionality, texture, process tolerance,
stability, opacity generation and flavor
Continued on Page 22

THE NEWS WEEKLY OF GRAIN-BASED FOODS

BUSINESS. ACCURACY. KNOWLEDGE. EXECUTION.

quarter of organic net sales growth, I'm
disappointed in our results on the bottom line. Our third-quarter operating
profit fell well short of our expectations, and cost pressures are impacting
our full-year outlook. Like the broader

Food Ingredient Solutions

Managing
Recalls

KEYS FOR
SPRING
SUCCESS

Continued on Page 19

February 2018

General Mills profits fall short;
grain-based shares tumble

MILLING TECHNOLOGY

08 TIME SAVING TIPS
10 SUPPLY SIDE ECONOMICS

NEW YORK - Hearthside Food
Solutions L.L.C., the nation's largest and fastest-growing independent
bakery and full-service contract manufacturer of grain-based food and
snack products, has been an active
acquirer of several bar makers over
the past year. Now, Hearthside itself
may be on the block, according to a
report from Bloomberg. Bloomberg on
Jan. 11 reported that Goldman Sachs
Group Inc.'s private equity arm and
Vestar Capital Partners are exploring
a sale of Downers Grove, Ill.-based
Hearthside Food Solutions. If the
groups go through with the sale, the
transaction could fetch about $2.5
Continued on Page 8

KANSAS CITY - In a year in which the
overall stock market roared to new record highs, the Grain-Based Foods Share
Index in 2017 barely squeaked out a fractional gain. Still, the index calculated by
Milling & Baking News managed to end
in the black for a ninth consecutive year.
At 0.7%, the advance was the smallest of the nine-year streak and followed
advances of 14.2% in 2016, 4.3% in 2015,
17.4% in 2014 and 22.7% in 2013.
While ending at the highest yearly close ever, the 24413.16 close was
below an all-time intra-year peak
of 25137.46 reached in December
2016 and the 2017 intra-year high of
25568.38 reached in June.
The 0.7% gain fell far short of advances
scored by major stock market indexes -
25.1% for the Dow Jones average of industrial shares, 21.7% for the S.&P.500 and
26.9% for the Nasdaq composite index.
Versus the 10 S.&P.500 sectors, the
grain-based shares significantly underperformed each with the sole exception

2018 Survey Results

CAPITAL
SPENDING

The

he U.S. Department of Agriculture
at the department's Agricultural
Outlook Forum in Washington
on Feb. 23 provided its first take on U.S.
wheat supply-and-demand prospects
for the 2018
19 crop year beginning June
2018-19
1. The wheat forecasts, presented by Joanna Hitchner, an economist with the
U.S.D.A.'s World Agricultural Outlook
Board, suggested a slight expansion in
area planted to wheat for harvest this
year and a 98-million-bu increase in
production from 2017. At the same time,
the overall wheat supply in 2018-19 was
forecast to be smaller than in the current
year, and ending stocks were projected
down 8% from the forecast for 2017-18.
There were few surprises in the outlook,
and analysts interviewed by Milling &
Baking News agreed with the department's basic outlook as a starting point.
The projections presented by Ms.
Hitchner at the forum were preliminary.

A SOSLAND PUBLICATION

bakingbusiness.com / foodbusinessnews.net

Ingredient Market Roundtable

GENERAL MILLS, INC.

of energy, which declined 1%. Disappointingly, the grain-based index fell
more than 12 percentage points shy
of the 13% gain scored by the S.&P.500
consumer staples sector. The consumer
discretionary index was up 23% in 2017.
Gains from other sectors of the S.&P.500
ranged from a low of 12% for utilities to
a high of 34% for technology.
Two companies included in the
Grain-Based Foods Share Index in 2016
were acquired in 2017. In June, Tyson
Foods, Inc., Springdale, Ark., completed an acquisition of AdvancePierre
Foods Holdings, Inc., Cincinnati, for
Continued on Page 20

Urgency, optimism after checkoff
steering committee convenes
WASHINGTON - Broad outlines of a
potential checkoff program for the flourbased foods industry took shape last week
with the inaugural meeting of a Grain
Foods Foundation steering committee responsible for assessing, developing and
potentially launching such a program.
Christine Cochran, executive director

of the G.F.F., called the Oct. 10 meeting a
success and described a sense of urgency
among the group of milling and baking executives to take steps to reverse declining
trends in grain-based foods consumption.
"There was real momentum to build
a commitment toward a checkoff," she
said. "Many details are still up for consideration, but there was consensus that
we should pursue a program. These folks
are ready to move. If we could launch tomorrow, they would be happy."
Notwithstanding this enthusiasm,
numerous steps remain to be completed and decisions to be made before
a launch will be possible, Ms. Cochran
Continued on Page 17

THE FLAVOR ISSUE:

fresh milled,
fresh brewed
SCIENCE OF SOURDOUGH
Protecting the past for future bakers
FUTURE OF FLAVORS
Consumers seek adventurous foods
FLATBREADS ON THE RISE
New products drive category growth

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Table of Contents for the Digital Edition of BEMA - June 2018