NEW YORK — Flowers Foods, Inc. fresh baked products will be available in 75% of the United States within five years, according to a new management strategy detailed March 22 by company executives. Currently, the company’s market penetration is about 50%.

With what the company described as an ambitious plan for growth, Flowers Foods executives have raised the company’s long-term annual sales growth target to 5% to 10% from 5% to 8%.

“We are setting a new marker today,” said George E. Deese, chairman and chief executive officer.

The forecast was discussed at an analysts meeting hosted by Flowers at the New York Stock Exchange. Mr. Deese said Flowers will achieve the expansion by moving into new territories through acquisitions and construction of new baking plants.

“We have created a sound plan to continue building on our strong position in the baking industry,” Mr. Deese said. “We currently have the No. 1 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.”

Breaking down the projected annual sales growth, Steve Kinsey, executive vice-president and chief financial officer, said the company expects organic growth in core markets to add 3% to 5% with acquisitions and expansions contributing 2% to 5%.

In addition to raising its sales growth target, Mr. Deese said Flowers sees improved EBITDA margins ahead. While the forecast may have drawn skepticism because of pressure on margins in recent years, Mr. Deese said Flowers’ history of margin improvement should ease the doubts of naysayers.

“I can remember when we were 7,8,9 and we set our new goal of 10 to 12 (EBITDA margin), many of you wondered whether we can do that in the baking business,” he said. “We said we can. Over the past couple years we’ve been at the top end of that range. We feel comfortable raising EBITDA margin from 10 to 12 to 11 to 13, which will give us double-digit e.p.s. growth.”

While acquisitions have been central to the growth strategy of Flowers Foods for decades, Mr. Deese spoke with heightened seriousness about prospective merger and acquisition activity in the industry and its importance to Flowers.

“I believe consolidation is now,” he said. “More than ever, I believe it is now. Today, not way out into the future.

“Flowers Foods will be a key player in the future of the baking industry. We aren’t saying we are going to be the biggest. We are saying we are going to be the best. If we become bigger by being the best, that’s okay.”

Mr. Deese seemed to intimate the fresh baking industry could consolidate to a point that only two major players would remain in the industry.

“In cereal and beverages, the industry is down to one or two companies,” he said. “We see that happening in the food business. Flowers is a strong No. 2 player.”

From an operations and sales perspective, Flowers is well positioned to reach the more ambitious sales goals, said Allen Shiver, president of Flowers Foods.

Central to his confidence is the

company’s strong track record of growth through expanding into new geographies and by introducing new products, leveraging its brands and providing solid customer service, he said.

Mr. Shiver offered the example of the company’s surging growth in the mid-Atlantic states as well as its rapid success in Southern California as evidence of the company’s ability to do well in new geographies.

Mr. Shiver also offered insights into the new product environment for baking, pointing out the surge in sales of sandwich thins/rounds does not appear to be cannibalizing sales of traditional baked foods.

Discussing the company’s history of geographic growth, he noted overall the company’s reach expanded to 53% of the U.S. population in 2011 from 38% in 2004.

Describing the basic Flowers playbook for entering new markets, Mr. Shiver said the company usually goes into a new geography with a few direct store delivery routes, gaining a foothold with national retailers “that already know our company.”

“From there, it’s a steady build,” he said.

With a baking plant in Lynchburg, Va., Flowers was able to begin serving a population of 8 million in Maryland, northern Virginia and Washington.

“We broke the market with 43 key accounts and only 6 routes,” he said. “By 2010 we had 1,200 key accounts and 108 routes.”

He said Flowers market share in this region has reached 5.4%, 15% in the soft variety loaf category.

“We consider this market as part of our core territory,” he said, describing the expansion as one of the most successful ever for the company.

Offering a more recent example, Southern California, Mr. Shiver said Holsum Bakery of Arizona had only a “small presence (there) in select markets” when Flowers acquired the business in 2008.

“With a population of 23 million and with urban centers that include Los Angeles and San Diego, we believe this area has tremendous potential for our Nature’s Own brand,” Mr. Shiver said.

From the modest base in 2008, Flowers currently is serving 700 supermarkets, adding 120 independent routes.

“The momentum in the marketplace continues to build,” he said, noting the company’s market share has grown to 225 basis points in late 2010 from 30 in late 2008.

“In both northern Virginia and Southern California, our expansion was slow and steady,” he said. “We take the time necessary to serve our retail and food service customers.”

Turning to product innovation, Mr. Shiver cited for the investment analysts a variety of ways the company stays abreast of consumer trends.

“New products spur sales growth in core markets,” Mr. Shiver said. “Our goal is for new products to contribute 5% to annual sales.”

Flowers achieved the goal in 2010 and has had a number of new product successes in recent years, he said.

“2010 was the year of the sandwich round,” Mr. Shiver said. “Nature’s Own was the first on the market with a resealable bag and garnered the most sales growth of any new product in I.R.I. South in this particular segment.”

In 2011, Flowers already has had new product introductions and reformulations with an emphasis on healthy options and portion control in bread and rolls.

Building on the success of its Nature’s Own sandwich rounds, the company has expanded the line to four varieties, including a Whitewheat sandwich round.

“The center version of the traditional bun has been one of the most exciting new product developments in the category that I can remember,” Mr. Shiver said. “We also modified the recipe for Nature’s Own thin sliced bagels and introduced the line in resealable packaging.

“Sandwich rounds and thin bagels have had a positive effect on category. Consumers are using them for breakfast, lunch, dinner and snacks. Most households are purchasing sandwich rounds in addition to their regular bakery purchases.”

Emphasizing the importance of the Nature’s Own brand to the growth prospects of Flowers, Mr. Shiver noted the brand has enjoyed a compound annual sales growth rate of 13% since 2000.

“There is no doubt that our future growth is anchored in the Nature’s Own brand,” he said.

Turning briefly to the cake category, Mr. Shiver said recent new products introductions include chocolate bells and chocolate chip muffins containing Hershey brand chocolate. The continuing focus on healthy eating has not eliminated growth opportunities in snacks, Mr. Shiver said.

“People are still indulging in their favorite snacks,” he said.

Mr. Deese acknowledged the competitive landscape in baking is continuing to change but expressed confidence in Flowers’ capacity to navigate through the current situation.