Milling & Baking News - August 26, 2008 - 36

Financial Results

Cargill net climbs 55% in fiscal 2008
MINNEAPOLIS - Net earnings for
Cargill for the fiscal year ended May
31 were $3.64 billion, up 55% from
$2.34 billion during the previous year.
After factoring in a $310 million gain
on the sale of discontinued operations
during the fourth quarter, full-year
earnings totaled $3.95 billion.
Revenue for the year increased 36%
to $120.4 billion, while cash flow from
operations rose 77% to $7 billion.
"Cargill posted a record financial
performance in a year of exceptionally strong commodity demand,

market turbulence and price risk,"
said Greg Page, chairman and chief
executive officer. "By bringing to
bear our business diversity, the full capacity of our
global assets, strong risk
management and a significant increase in capital deployed, we operated successfully in the most volatile agricultural
energy markets in decades. Despite
tight stocks of many agricultural
commodities, we maintained reliable
supply chains for our customers and

J.M. Smucker income up 4% in quarter
ORRVILLE, OHIO - For the first quarter ended July 31, the J.M. Smucker
Co. posted net income of $42,291,000,
equal to 78c per share on the common
stock, up 4% from $40,761,000, or 72c
per share, during the same quarter of
the previous year.
Sales for the quarter were $663,657,000,
up 18% from $561,513,000 from the same
quarter of the previous year.
"We delivered good sales and earnings growth this quarter, establishing
momentum as we enter the back-toschool and fall bake periods," said
Richard Smucker, president and co-

chief executive officer. "We are practically pleased that we are experiencing sales growth across most of our
brands despite taking significant price
increases to offset record raw material costs. Our strategy of owning No.
1 brands and supporting them with
consistent investments in marketing
and product innovation provides opportunities for continued long-term
profitable growth."
Sales in the quarter were boosted
by pricing actions and volume gains
in categories such as Smucker's fruit
spreads, Uncrustables sandwiches,

Einstein Noah rebounds, posts
income of $6.9 million
LAKEWOOD, COLO. - Einstein
Noah Restaurant Group recorded net
income of $6,914,000, equal to 43c per
share on the common stock, in the second quarter ended July 1, up sharply
from a loss of $250,000 in the previous
year's second quarter. The company
said operational efficiencies, reduction
in interest expense and a second-quarter 2007 write off of debt issuance costs
led to the net income.
Net sales in the second quarter
totaled $105,414,000, up 4% from
$101,055,000 in the same period a
year ago. Comparable store sales
growth was 1% despite being affected negatively 0.6% by a reduction in hours of operation at certain
restaurants.
"While our decision to reduce
hours affected comparable store
sales, the store-level margin improvement outweighed the impact of
lower sales," said Rick Dutkiewicz,
chief financial officer of Einstein
36 / August 26, 2008

Milling & Baking News

Noah, when second-quarter results
were given Aug. 6. "Essentially, we
carefully analyzed our restaurants to
optimize their store hours based on
profitability after 3 p.m. On a prospective basis, we have optimized
store hours further and believe this
will additionally reduce comparable
store sales by approximately 0.6%."
Einstein Noah opened eight license
locations and three company-owned
restaurants in the second quarter. Two
Einstein Bros. Bagels development
agreements call for restaurants to open
in Texas, and the company entered
into a development agreement to franchise a new Manhattan Bagel location
in Charlotte, N.C.
"Despite the current economic
challenges, we are committed to
strengthening the brand on all three
fronts - franchising, licensing and
company-owned locations," said
Paul Murphy, chief executive officer
and president of Einstein Noah. "The

created value-adding solutions."
For the fourth quarter ended May
31, net earnings were up 18% to $744
million from $628 million during the
same period of last year. The company said the improvement
was led by the origination and processing segment and the industrial
segment, both of which
were up substantially from the same
period a year ago. Earnings in agriculture services, food ingredients
and applications, and risk management, meanwhile, were down from
the same period a year ago. MBN
Pillsbury baking mixes and frostings, and Hungry Jack potatoes and
pancakes.
"We look forward to adding another No. 1 brand with the merger of the
Folgers coffee business into Smucker," said Tim Smucker, chairman and
co-chief executive officer. "Folgers
will be our largest brand with sales
in excess of $1.5 billion and builds on
our center-of-store focus. We expect
the addition of Folgers to significantly increase cash flow and, combined
with the substantial increase in our
sizes and scale, provide a platform for
future growth and enhance our longterm growth opportunities." MBN
margin improvement we experienced
in the second quarter demonstrates
the effectiveness of our strategy.
"As we begin to set the stage for
2009, we have taken a modest position on locking in some of our commodities costs for next year. We have
an agreement in process to secure our
turkey supply into the fourth quarter
of 2009 at about the same 2008 cost,
and we have locked in 50% of our
cheese costs for 2009 below the cost
of cheese in 2008."
For the first six months ended
July 1, Einstein Noah posted net income of $10,756,000, or 68c per share,
up from $881,000, or 8c per share,
in the same period a year ago. Net
sales were $208,678,000, up 6% from
$197,310,000.
Einstein Noah Restaurant Group
operates locations primarily under
the Einstein Bros. Bagels and Noah's
New York Bagels brands and primarily franchises locations under the
Manhattan Bagel brand. The company's retail system consists of more
than 600 restaurants in 35 states and
the District of Columbia. MBN
bakingbusiness.com / world-grain.com

http://www.bakingbusiness.com http://www.world-grain.com

Milling & Baking News - August 26, 2008

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