Milling & Baking News - January 27, 2004 - (Page 1)

Theinewsweeklyiofigrain-basedifoods / New Sara Lee Bakery bread line sees strong launch; profits surge CHICAGO - In the first weeks since its launch, a new line of Sara Lee Bakery fresh bread, including the company's lowcarbohydrate Delightful varieties, have exceeded company expectations, eclipsing the highly successful October 2002 debut of its Sara Lee brand fresh bread. Very preliminary performance for the line was reviewed by Aaron Hoffman, Sara Lee Corp. executive director of investor relations, in a Jan. 22 conference call in connection with the company's quarterly financial results. Operating income of Sara Lee Bakery in N E W S F E AT U R E the second quarter ended Dec. 27 was $55 million, up 158% from $21 million in the second quarter last year. Sales were $871 million, up 1%. While most of the earnings gain was attributed to restructuring expense in the prior year and foreign currency gains, 20 percentage points of the profit jump were credited to higher gross margins and a lower cost structure resulting from the restructuring. "Strong sales for frozen Sara Lee heritage products, a very strong retail pie season, positive product mix in Continued on Page 14 MGP Ingredients stock soars on earnings guidance, expansions ATCHISON, KAS. - Common stock of MGP Ingredients, Inc. last week soared to its highest level in more than nine years after the company raised its fiscal year earnings guidance and announced still another manufacturing expansion. MGP announced Jan. 20 that it was raising its earnings guidance for fiscal 2004 to $1 to $1.10 per share from the previous range of 35c to 40c. The company's fiscal LATE CONSUMER SPENDING for cereal, bakery products declines again Story on Page 25 year will end June 30. In trading on the NASDAQ National Market that day, MGP shares surged 11% to close at $24.59 per share. The stock had not traded that high since December 1994, when the company operated under the name of Midwest Grain Products. Ladd Seaberg, president and chief executive officer of MGP, said the revised Continued on Page 10 NEWS PENNSAUKEN, N.J. - J&J Snack Foods Corp. has "hit the deck running" integrating the recently acquired Country Home Bakers business, said Gerald B. Shreiber, J&J president and chief executive officer. Mr. Shreiber commented about Country Home in a Jan. 22 conference call. J&J will be focused on restoring the profitability of and growing the Country Home business, Mr. Shreiber said. J&J said it expects to record at least a mid-single digit operating margin from Country Home in fiscal 2004. In the first quarter ended Dec. 27, J&J posted net Continued on Page 8 J&J Snack posts record sales inside JANUARY 27, 2004 C.P.I. for baked foods, cereals rises 2.3% in '03 WASHINGTON - The Consumer Price Index for baked foods and cereal products posted its eighth consecutive year of higher prices in 2003, advancing 2.3%. The 2003 increase followed a 2.1% advance in 2002, according to the Bureau of Labor Statistics of the U.S. Department of Labor. The 2003 year-end increase paralleled the broader index for all food at home, which rose 2.1% for the year. The C.P.I. for every category of grainbased foods increased in the 12-month period that ended in December. In most instances, advances ranged between 2% to 3% for the year. The 2.3% increase in the price index for Cereals and Bakery Products in 2003 was a shade better than the gain scored in 2002. The price index for this category rose 2.1% in 2002, 2.9% in 2001, 2% in 2000 and 1.8% Continued on Page 19 THIS WEEK CarbAction bread line launched by I.B.C. 11 Ingredient Pete Frederick to Pendleton and Milner 20 Carb avoidance may outlive Atkins diet 31 Week 32

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Milling & Baking News - January 27, 2004