Milling & Baking News - February 10, 2009 - (Page 1)

THE NEWS WEEKLY OF GRAIN-BASED FOODS FEBRUARY 10, 2009 / FEATURE I.B.C. emerges from bankruptcy, will operate as a private company Shelf life innovations focus on simple, sweet issues Natural preservatives allow for clean labels while other systems target sweet goods Story on Page 20 LATE NEWS Munyon: Inspections boost food safety MANHATTAN, KAS. - Food plant inspections conducted by AIB International are a "time-proven invaluable management tool for the enhancement of food safety in North America and around the world," said James R. Munyon, president and chief executive officer of AIB International, Manhattan. AIB last week was pulled into the controversy surrounding a Salmonella outbreak when the Peanut Corporation of America said its Blakely, Ga., plant had "regular visits and inspections." Because of confidentiality agreements, AIB said it was unable to comment specifically on its inspections of the Blakely Continued on Page 8 KANSAS CITY - Nearly 4½ years after filing for Chapter 11 protection, Interstate Bakeries Corp. on Feb. 3 finally emerged from bankruptcy after successfully concluding its financial reorganization with the unanimous support of union locals and secured creditors. The announcement came less than a week after a U.S. bankruptcy court judge approved changes to I.B.C.'s reorganization plan that included GE Capital cutting its lending total to $105 million from $125 million with other lenders agreeing to make up half of the $20 million reduction in financing. I.B.C. had faced a deadline of Feb. 9 to work with lenders and investors to exit bankruptcy or risk losing its financing. With the reorganization, I.B.C. will tap into a $600 million financing plan that gives control of the company to buyout firm Ripplewood Holdings L.L.C. and the baker's lenders and makes I.B.C. a private company. The company said its management team, led by Craig D. Jung as chief executive officer, will remain in place. "Today marks a new beginning for Interstate Bakeries," Mr. Jung said. "We are now a stronger and more competitive company. With this period behind us, we can now unleash and empower 22,000 I.B.C. employees to better serve our consumers and customers, revitalize our core brands, and launch product innovation that will profitably grow our business." Mr. Jung thanked I.B.C.'s employees for their sacrifices and union leaders for their commitment to saving jobs during the proceedings. "Their actions made possible the financing required to execute a business Continued on Page 9 Flowers earnings up 26% in 2008, including 50% jump in fourth quarter THOMASVILLE, GA. - Net income of Flowers Foods, Inc. in the year ended Jan. 3 was $119,233,000, equal to $1.28 per share on the common stock, up 26% from $94,615,000, or $1.02 per share, in fiscal 2007. Net sales were $2,414,892,000, up 19% from $2,036,674,000 in 2007. The wide earnings and sales gains in 2008 were capped by a particularly strong fourth quarter. Net income was $32,086,000, or 34c per share, up 50% from $21,431,000, or 23c per share. Net sales were $621,592,000, up 31%. "Our strong fourth-quarter results completed an exceptional year for Flowers Foods despite a difficult economic environment," said George E. Deese, chairman, president and chief executive officer. "Our 2008 results show the strength of our business model, strategies, and, most importantly, our team. We delivered robust sales growth driven primarily by increased sales of Nature's Own and Whitewheat breads, recent Continued on Page 15

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Milling & Baking News - February 10, 2009