Flowers Foods Q1 sales slip as bread market softens
- Flowers Foods sales decreased 1.4% to $1.188 billion in the first quarter of 2017, according to its latest earnings report.
- The producer of Nature's Own, Wonder, Tastykake and other bakery foods also saw net income rise 1.8% to $60.4 million. Company President and CEO Allen Shiver said in the report that improved manufacturing efficiencies and capacity investments lowered production costs and boosted sales.
"Earlier this month, we announced plans to change our organizational structure to support greater brand growth, accountability, operational efficiency, and our long-term strategy," Shiver said. "I'm confident these efforts, and the others outlined under Project Centennial, will deliver value to shareholders in line with our long-term goals."
Flowers Foods said that given category trends to date, it expects sales to shift to the lower end of the previously provided range of $3.927 billion to $4.006 billion for fiscal 2017.
The company has been busy streamlining its operations under a comprehensive business and operational review to grow sales and improve profits under a program called "Project Centennial." The company announced earlier this month that it was reorganizing, emphasizing brand growth and innovation. At the time, company leaders said they would focus on margin expansion and strengthen long-term strategy.
Additionally, the company reorganized key leadership positions. This revamped structure now includes two separate business units — fresh bakery and snacking/specialty. Changes in both units are expected to continue for the foreseeable future.
Last year, the company finished strong, boosted by solid performances of new acquisition Dave’s Killer Bread, Nature’s Own and the Wonder brand.
Allen Shiver, Flowers Foods president and CEO, was pleased with the growth in the bread category and the company’s launch of four organic breakfast items to expand offerings under the Dave's Killer Bread brand. These are areas that analysts expect will continue to see strong growth in the year ahead.
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