Milling & Baking News - February 8, 2005 - (Page 1)

Theinewsweeklyiofigrain-basedifoods / FEBRUARY 8, 2005 Sara Lee fresh baked foods to be sold nationwide in '05 ST. LOUIS - Turbocharging a blueprint for geographic expansion announced only three months earlier, Sara Lee Bakery last week said it now plans to be selling its fresh baked foods in all 48 states of the U.S. mainland by the end of 2005. Richard A. Noll, chief executive of Sara Lee Bakery, said the dramatic acceleration of the expansion is made possible by arrangements the company has made with a number of retailers in the new markets and by success the company has had introduc- ing the Sara Lee brand of fresh baked foods into new markets. Once completed, Sara Lee Bakery will be the only fresh baking company delivering bread throughout the mainland United States, the company said. In the markets it currently serves with these products, Sara Lee reaches 68% of U.S. consumers. Sara Lee expanded geographically very little during 2003 and much of 2004 as it focused on rationalizing its production Continued on Page 10 Cash flow difficulties propel Awrey Bakeries into bankruptcy LIVONIA, MICH. - Awrey Bakeries, Inc. has filed for creditor protection under Chapter 11 of the bankruptcy code, the family-owned company announced Feb. 3. The reorganization will allow Awrey, which was established in 1910, to restructure its finances and maintain normal business operations while it faces the burden of inadequate cash flow, the company said. LATE The filing was made with the U.S. Bankruptcy Court for the Eastern District of Michigan, Southern Division, in Detroit. "Let me underscore that this was an exceptionally difficult decision for us to make," Tom Awrey, the company's president, said. "After exploring other alternatives, however, we concluded that a Continued on Page 14 NEWS THOMASVILLE, GA. - Net income of Flowers Foods Inc. in the year ended Jan. 1 was $50.8 million, equal to $1.13 per share on the common stock, up sharply from $14.7 million, or 32c per share, in 2003. Income from continuing operations was $54.3 million, up slightly from $52.8 million in 2003. Sales in 2004 were $1.55 billion, up 7% from $1.45 billion. Results were in line with guidance provided by Flowers Jan. 10, which noted that higher compensation expense in connection with the company's rising share price, and higher compliance and commodity costs, adversely affected fourth quarter results (see Milling & Baking News of Jan. 18, Page 1). Net income in the fourth quarter was $7.5 million, or 17c per share, down from $17.2 million, or 37c per share, in the fourth quarter of Continued on Page 8 Flowers earnings up in 2004 inside Grains campaign launched NEW YORK -The Reuters Jumbotron in New York's Times Square in New York was aglow Feb. 1 with messages from the Grain Foods Foundation, marking the launch of the organization's LIFE public relations campaign (see story on Page 9). MBN THIS WEEK Hormel Foods acquires tortilla maker 14 Ingredient Kellogg Co. earnings, sales climb in 2004 16 Naomi Judd in breakfast cereal promotion 40 Week 31

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Milling & Baking News - February 8, 2005