PARSIPPANY, N.J. — New bread introduced at the beginning of this year has helped Udi’s generate positive consumption growth and has spurred sales within the Boulder business unit of Pinnacle Foods, Inc., said Mark A. Clouse, chief executive officer.
“We have focused our efforts on renovating and innovating our gluten-free businesses, starting with our bread offerings,” Mr. Clouse told securities analysts during an Aug. 2 conference call to discuss second-quarter financial results. “We’re pleased to report that the launch of the new Udi’s bread is performing very well. During the most recent period, our frozen gluten-free bread offerings grew nearly 5% at retail, which is a 12-point swing in consumption and is the main driver behind Udi’s returning to consumption growth.
“We are continuing to support this new bread with marketing in order to drive trial and awareness, and in the third quarter, we’ll be launching additional varieties. As previously mentioned, our focus is not just on bread. We will also be renovating our gluten-free pizzas and granolas in the third quarter as well as introducing new flavors in the back half of the year. We continue to believe there is strong growth potential in the gluten-free category, and we remain committed to our strategy of renovating and innovating within our core categories and delivering the no-compromise gluten-free experience consumers are looking for.”
Sales rose in the Boulder business unit to $98,898,000 from $94,654,000 a year ago. Business earnings rose to $16,018,000 from $12,249,000 the year prior.
Elsewhere in Pinnacle’s business, Mr. Clouse said the company’s Duncan Hines brand dealt with continued competitive pricing in the base baking mix business during the quarter. He said the company has vowed not to chase low-margin volume and held to that strategy during the quarter.
An area of the Duncan Hines business that performed well was Perfect Size for One. Mr. Clouse described the product offering as a “compelling and disruptive snacking platform.”
“As we lap the strong growth from last year’s initial introduction of the product, we feel good about the nearly 40% growth year-to-date,” he said. “However, given the new competition, we’re looking at our offerings to ensure we have the right mix, and we’re activating additional marketing strategies to support the continued leadership of our first-to-market innovation.”
Overall, Pinnacle Foods’ net income in the second quarter totaled $56,317,000, equal to 47c per share on the common stock, up sharply from $18,669,000, or 16c per share, in the same period a year ago.
Sales for the quarter fell slightly to $741,761,000, which compared with $744,608,000 a year ago.