PHILADELPHIA — Tasty Baking Co. in the second quarter ended June 26 sustained a loss of $3,334,000, versus net income of $2,345,000, equal to 27c per share on the common stock, in the same period a year ago. Sales were $73,589,000, down 6% from $78,532,000.

A number of special charges contributed to the net loss at Tasty Baking during the quarter. On a pre-tax basis, the company had accelerated depreciation of $1.4 million in the quarter, versus $1.3 million in the second quarter of 2009. Additionally, Tasty Baking said it had $5.1 million, pre-tax, of additional expenses related to the need to maintain two production facilities simultaneously in Philadelphia as well as costs for the transition to the new facility in the Navy Yard. The company also recorded $700,000 in pre-tax income related to the sale of spare parts and equipment as well as $600,000 in severance charges.

Sales during the quarter were affected by a decline in volume as well as lower net sales realization resulting from higher promotional and product return costs, the company said.

“The second quarter of 2010 proved to be a challenging period for us in terms of top line performance as well as the transition to the Navy Yard facility,” said Charles P. Pizzi, president and chief executive officer of Tasty Baking. “While we continued to outperform the category and increased our overall share, sales were down significantly versus the second quarter of 2009. We are intently focused on combating these top-line pressures through a combination of new products, new packaging and increased penetration in selected route expansion territories.

“We announced the completion of the transition of all of our production lines and the closure of the Hunting Park facility in June 2010. We incurred approximately $5.1 million in additional operating costs in the second quarter of 2010 to not only transition to and start up production at the Navy Yard facility, but also to simultaneously operate two Philadelphia facilities. During the quarter and since the closure of the Hunting Park facility, we have faced challenges while optimizing the performance of our operations at the Navy Yard bakery. We are, however, working diligently to overcome these challenges and expect to achieve the efficiencies necessary to generate our target of $13 million to $15 million in annual, pre-tax savings, net of leases, but before debt service during the fourth quarter of 2010.

“With regards to the potential sale of the Hunting Park and Fox Street properties, the due-diligence period ended July 30, 2010, and the buyer has deposited an additional $0.5 million into a non-refundable escrow account. The company anticipates that it will close on the sale of these properties in September 2010.”

For the first six months of fiscal 2010, Tasty Baking suffered a loss of $7,254,000, which compared with net income of $2,274,000 in the same period of fiscal 2009. Net sales were down 6% to $146,145,000 from $155,461,000.