PARIS — In March 2022 Hostess Brands, Inc. announced it had acquired a new facility in Arkadelphia, Ark., with plans to transform the plant into a “bakery of the future.” Fifteen months later, excitement about the project and what it means for the snack company’s entire network continues to build.
“We’re really excited about our new bakery in Arkadelphia, Ark.,” Travis Leonard, executive vice president and chief financial officer of Hostess, told analysts during a June 8 presentation at the Deutsche Bank dbAccess Global Consumer Conference in Paris.
Specifically, Mr. Leonard pointed to three areas of excitement related to the 330,000-square-foot plant, in which Hostess plans to invest between $120 million and $140 million.
First, the plant is expected to unlock approximately 20% incremental capacity across the company’s cake and Donette platforms. Mr. Leonard said Hostess “absolutely needs the capacity” to deliver against its long-term growth algorithm.
Second, Hostess is excited about the facility’s ability to leverage automation.
“Now we won’t have automation everywhere, but we’re really building this plant with an automation-focused mindset,” Mr. Leonard said. “And I would say also with a digitization mindset. This is important. So what we’re doing here is really looking and looking at how we can utilize digital tools. To be more efficient in the quality baking that we do at scale today. But the benefit is, is that we take those learnings and then we apply that back to our other bakeries within our network, and we drive efficiencies across our network.”
A third reason for executives’ excitement revolves around the sustainability mindset and approach in building the Arkadelphia plant.Mr. Leonard said Hostess plans to bring the Arkadelphia plant online in the fourth quarter of this year.