NEW YORK — At an event hosted for financial analysts today, executives of Flowers Foods (NYSE: FLO) unveiled the company's new vision for growth for the next five years. Flowers executives provided details of the company's plan for geographic expansion, as well as how the company plans to support growth through prudent financial management, operational excellence, and new product development. The meeting was held at the New York Stock Exchange.
"Our job is to create value for shareholders, and our team is always focused on ways to achieve meaningful growth. We have created a sound plan to continue building on our strong position in the baking industry," George E. Deese, chairman of the board and chief executive officer, told those attending the event and listening to the live Internet webcast. "We currently have the number one soft variety brand in the country in Nature's Own, and that's from serving slightly more than half of the U.S. population. Going forward, we will grow more aggressively by expanding into new territories from our existing bakeries, by merging with independent bakers, by making strategic acquisitions, and by building greenfield bakeries. By 2016, our goal is that at least 75% of the population will have access to our Nature's Own brand."
In light of the new growth plan, the company has reset its long-term (five-year) goals. New sales growth goals are 5% to 10% annual growth (including acquisitions), up from the current long-term goals of 5% to 8% (excluding acquisitions). Steve Kinsey, executive vice president and chief financial officer of Flowers Foods, said the new sales growth goals are comprised of two key components: organic growth in core markets and expansion markets that are expected to add 3% to 5% annually, and acquisitions that are expected to add 2% to 5% annually. As a result, the company now projects double-digit earnings per share growth annually during the five-year period, he said.
Kinsey noted that guidance provided for 2011 includes the cost of a recent plant closing. A charge of approximately $.04 – $.05 related to the closing will be recorded in the first quarter of 2011. The effect on the full year will be neutral to slightly dilutive.
Allen Shiver, president of Flowers Foods, discussed from an operations and sales standpoint how the company is well-positioned for accelerated growth. He cited the company's confidence in – and proven success with – its core growth strategies: expanding into new populations off the strength of established markets; and increasing sales in core markets through new products introductions, leveraging strong brands, and by providing exceptional customer service. Shiver also pointed out another of the company's key advantages: its ongoing commitment to quality and a relentless passion to improve the business, which drives out costs and improves overall margins.
Deese closed the meeting by reiterating his confidence in the long-term goals. "While the marketplace dynamics and competitive landscape have changed of late, I am confident in Flowers Foods' ability to execute our strategies and continue to deliver value to our shareholders, our customers, and our consumers," he said.
Flowers Foods broadcast the event live over the Internet as it occurred. The archived presentation can be accessed on the company's Web site www.flowersfoods.com.
Company Information
Headquartered in Thomasville, Ga., Flowers Foods is one of the nation's leading producers and marketers of packaged bakery foods for retail and foodservice customers. Flowers operates 39 bakeries that produce a wide range of bakery products sold through an extensive direct-store-delivery network that encompasses the Southeast, Mid-Atlantic, and Southwest as well as select markets in California and Nevada, and nationwide through other delivery systems. Among the company's top brands are Nature's Own, Whitewheat, Cobblestone Mill, Blue Bird, and Mrs. Freshley's. For more information, visit www.flowersfoods.com.
Statements contained in this press release that are not historical facts are forward-looking statements. All forward-looking statements are subject to risks and uncertainties that could cause actual results to differ from those projected. Other factors that may cause actual results to differ from the forward-looking statements contained in this release and that may affect the company's prospects in general include, but are not limited to, (a) competitive conditions in the baked foods industry, including promotional and price competition, (b) changes in consumer demand for our products, (c) the success of productivity improvements and new product introductions, (d) a significant reduction in business with any of our major customers including a reduction from adverse developments in any of our customers' businesses, (e) fluctuations in commodity pricing, (f) our ability to fully integrate recent acquisitions into our business, and (g) our ability to achieve cash flow from capital expenditures and acquisitions and the availability of new acquisitions that build shareholder value. In addition, our results may also be affected by general factors such as economic and business conditions (including the baked foods markets), interest and inflation rates and such other factors as are described in the company's filings with the Securities and Exchange Commission.
Source: Flowers Foods