March 17, 2004

Dreyer's reports huge revenue gains.... General Mills' earnings remain flat.... Upstate Farms seeks new plant site.... Parmalat reorganization plan expected soon.... Labor action drags down earnings at Kroger, Albertson's.... Kash n' Karry to launch new concept stores.... Dairy Health Beat.... Odds-and-Ends.... Stock Market Ticker.... More news at www.idfa.org.

DAIRY BUSINESS BRIEFS

Oakland, Calif.-based Dreyer's Grand Ice Cream Holdings Inc. reported total net revenues of nearly $1.2 billion in 2003, up $587 million from the prior year as a result of the company's acquisition last June by Nestle Ice Cream Co. In the fourth quarter, Dreyer's totaled $384.1 million in revenue, up from $104.8 million during the same period in 2002. Results are not directly comparable to the prior year due to the merger, which shifted the companies' fiscal calendars. (Company report)

General Mills Inc., Minneapolis, Minn., reported flat earnings for its third quarter compared to 2003. General Mills, maker of Yoplait Yogurt and other food products, earned $242 million for the quarter (ending Feb. 22), a slight increase over the $240 million it earned during the same time period in the previous year. Net sales for the quarter increased 2% to $2.7 billion, up from $2.65 billion in 2003. (Associated Press)

Buffalo, N.Y.-based Upstate Farms Cooperative is seeking a site for a new dip, yogurt and cottage cheese processing plant and warehouse facility. The co-op is considering sites in West Seneca, N.Y., and Warren, Pa. To promote the New York location, the Erie County Industrial Development Agency is offering a $27 million incentive plan if the co-op chooses the West Seneca site. (Buffalo News)

Parmalat Finanziaria SpA is expected to retain its dairy operations in Australia, Canada, South America and its main Italian dairy operation under a reorganization plan, which could be announced next week. The company will likely continue to shed non-core assets, including Parmalat USA Corp. Parmalat USA creditors have requested that a trustee be appointed to take control of the bankrupt U.S. group. In Chile, milk producers have halted milk supplies to the local unit of Parmalat after the company failed to remit more than $4.5 million in back payments. In Italy, Francesca Tanzi, daughter of Parmalat founder Calisto Tanzi, was released from jail on March 8 after an Italian court ruled that she had not played a leading role in the company's mismanagement. As the former head of Parmalat's tourism company, she had been jailed since Feb. 17. The tourism company is believed to have received large amounts of money from the parent company to cover losses. (Associated Press)

CUSTOMER CLIPS

The southern California strike of grocery workers dampened earnings for Cincinnati-based Kroger Co. and Boise, Idaho-based Albertson's Inc. Kroger reported a fourth quarter loss of $337.4 million. Albertson's reported its quarterly earnings at just $130 million, down from $205 million during the same period during the previous year. Kroger's California chain Ralphs and Albertson's both endured a 4½ -month labor action; Kroger additionally suffered a 2-month labor action that affected store units in Kentucky, Ohio and West Virginia. Kroger reported a total impact of $156.4 million on earnings due to labor issues. Albertson's said that the labor issues reduced its quarterly earnings by $90 million. (Associated Press)

Tampa, Fla.-based Kash n' Karry plans to replace the Kash n' Karry banner with a new supermarket brand, Sweetbay Supermarkets, over a three-year period. The new concept will be launched this fall in 50,000-square-foot stores in three Florida cities: Naples, Fort Myers and Seminole. Among the changes, the new stores will expand the selections for produce, ethnic and organic items. Kash n' Karry is a division of Delhaize America, part of the Belgium-based Delhaize Group. The parent company reported 2003 net earnings decreased by 4% to $210.1 million, largely because of a slumping U.S. dollar. (Orlando Sentinel; Company report)

Supermarket Labor Issues: Negotiations have begun on a four-year contract between the United Food and Commercial Workers (UFCW) union, which represents 18,000 Washington, D.C., supermarket workers, and Giant Food LLC, Landover, Md.; and California's Safeway Inc. The current contract expires March 27. The contract proposal under debate calls for cuts in both pay and vacation for new employees. Meanwhile in Chicago, the UFCW has started a flier campaign asking customers to boycott six Treasure Island stores and two Potash Bros. supermarkets. The stores' labor contract expired March 7; worker healthcare and benefit contributions are the main issue in the negotiations. (Washington Post; Chicago Tribune)

DAIRY HEALTH BEAT

Saturated fat levels drop significantly in milk produced by cows fed a diet supplemented with rapeseed oil, which is rich in unsaturated fats. About 150 Northern Ireland producers are currently using such supplements in their dairy cows' feed. "Naturally spreadable butter," derived from milk produced by rapeseed-supplemented cows, is already on the United Kingdom market. The unsaturated fat oleic acid makes the butter spreadable even when cold. (United Press International)

Long popular in Europe, probiotic-fortified dairy products are gaining new attention in the United States due to touted immune-system-strengthening qualities. In January, The Dannon Co. relaunched its probiotic dairy drink, DanActive. The drink contains 10 times the amount of active cultures found in yogurt. Available in four flavors, the suggested retail price (SRP) is $2.29 per four-pack. (Chicago Tribune)

A new study finds that milk may prevent gout, a painful joint ailment. A study published in the New England Journal of Medicine found that drinking one to five glasses of lowfat milk daily reduced the risk of gout by 43%. (Reuters)

IDFA NEWS

Enter Nominations Now for IDFA's Dairy Plant Safety Awards!
Entries are due by March 31 for IDFA's Dairy Plant Safety Recognition Awards, a new program to honor U.S. dairy processing facilities for excellent worker safety performance. Facilities will be judged in four product categories: natural and processed cheese; dry, condensed and evaporated products; ice cream and frozen desserts; and fluid milk. There is no fee to enter, so send in a nomination now! Award winners will be announced during IDFA's Plant Operations Conference, scheduled for May 4-5 in Chicago. For more information and a nomination form, click here: http://www.idfa.org/news/releases/2004/pr020404.cfm

Then, be sure to register for IDFA's Plant Operations Conference by clicking here: http://www.idfa.org/meetings/2004plantop.cfm

ODDS-AND-ENDS

Superior Dairy in Perry Township, Ohio, is recovering from a March 12 fire that destroyed one of its three facilities. The dairy is expected to be back at nearly full capacity by the end of the week. The fire destroyed the new technology facility at the plant where Superior puts milk in "caseless" bottles -- a high-tech design that allows milk bottles to be shipped without cases. (Times Reporter, Dover-New Philadelphia, Ohio) .... An eight-year employee at the Framingham, Mass., Breyer's plant died March 15 when he was crushed by a piece of heavy equipment. (Associated Press) .... Spilt Milk: Two recent incidents left milk tankers overturned. First, in downtown Crown Point, Ind., a 5,000-gallon tanker tipped over, spilled its cargo, crushed three parked cars into a storefront and trapped employees inside. Then, in Upper Macungie Township, Pa., highway traffic was re-routed for five hours when a milk tanker overturned; a haz-mat team contained the spill from entering a nearby creek. Luckily, no major injuries were reported in either accident. (Associated Press; Allentown Morning Call)

STOCK MARKET TICKER

As of 3/16/04, market close.

Company/Symbol		Last Trade		Change over Previous Close		Change over Last Week's D-brief
ConAgra Foods/CAG Dean Foods/DF Dreyer's/DRYR General Mills/GIS Groupe Danone/DA Hershey Foods/HSY Ingles Markets/IMKTA Kraft Foods/KFT Kroger/KR Ruddick Corp./RDK Safeway/SWY Saputo/SAP.TO SuperValu/SVU Unilever PLC/UL Weis Markets/WMK Wimm Bill Dann/WBD Winn-Dixie/WIN		26.44 34.42 79.00 46.15 32.70 82.51 10.92 32.40 16.49 18.72 20.35 30.55 27.51 40.09 32.48 17.76 06.71		-0.38 -0.85 +0.05 -0.02 -0.08 -1.71 -0.07 -0.12 +0.00 -0.27 +0.00 -0.35 -0.10 +0.29 -0.47 -0.79 +0.00		-1.32 -1.56 +0.17 -1.43 -1.35 -1.49 -0.08 -2.10 -2.07 -1.05 -1.35 -0.90 -0.97 -1.56 -0.81 -1.30 -0.59
Source: Yahoo! Finance

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