Lancaster Colony seeks boost to frozen roll segment

by Eric Schroeder
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Sister Schubert's frozen dinner rolls, Lancaster Colony Corp.
Lancaster hopes to spark Sister Schubert brand with new, and different, advertising plan.

COLUMBUS, OHIO — Frozen dinner rolls continues to be the most challenging category for Columbus-based specialty food maker Lancaster Colony Corp., the company’s top executive said during an Oct. 29 conference call with analysts to discuss fiscal 2016 first-quarter results.

“Looking at I.R.I. sell-through data for the 12 weeks ended Oct. 4, we held or grew share in four of our six key categories,” said Jay Gerlach, chairman, chief executive officer and president. “Our most challenging category continues to be frozen dinner rolls, where both the category and our Sister Schubert brands showed declines. As we enter the very important holiday season for this brand, we feel we have a very comprehensive and attractive promotional plan. Hopefully, the consumer will respond favorably.”

The plan, Mr. Gerlach said, will include an effort to be “as all-encompassing as ever.” Lancaster plans to achieve this by using expanded digital merchandising to help support traditional couponing. Additionally, for the first time Lancaster intends to run TV advertisements in Sister Schubert’s core markets.

“So, overall, we think we’ve got a very strong consumer and trade program in place that we hope will make a difference from a consumer sell-through standpoint,” he said.

Net income at Lancaster Colony in the first quarter ended Sept. 30 was $27,628,000, equal to $1.01 per share on the common stock, up 21% from $22,761,000, or 83c per share, in the same period a year ago. Net sales increased 13% to $294,085,000 from $259,987,000.

“Last year’s first quarter was challenged by inefficient plant operations due to capacity constraints, higher new product introductory costs and higher freight costs,” Mr. Gerlach said. “This year’s quarter benefited from the capacity addition brought on stream in January, limited product introductory costs, lower consumer spend and slightly reduced freight costs.”
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