To view D-brief online, visit www.dbrief.org

April 20, 2005

D-Brief evolution...Kraft Foods financials...Farmland Dairies emerges from bankruptcy...CoolBrand financials...Roberts Dairy to close Des Moines facility...Saputo completes purchase of cheese operation...Dairy People News...New Product Scanner...Supervalu financials...Meijer changes executive staff... Roundy's to buy Madison Pick 'N Save units...Odds-and-Ends...Stock Market Ticker...More news at www.idfa.org.

EVOLUTION of D-Brief

In response to the growing need for timely dairy business news, IDFA is replacing D-brief with an e-newsletter called "IDFA SmartBrief" that will be delivered to your inbox three times a week. This will be the final issue of D-brief, with IDFA SmartBrief launching in its place next Wednesday, April 27. IDFA SmartBrief—which will continue to be free to IDFA members and beyond—is a significant evolution of D-Brief and will enhance the way that dairy foods professionals receive critical business news about the industry. Please take a moment to update your subscription to ensure that you continue to receive the newsletter and in a format compatible with your e-mail service by clicking here.

DAIRY BUSINESS BRIEFS

Kraft Foods Inc. increased its first quarter profits 27 percent to $713 million (42 cents per share) compared to last year's first quarter profits of $560 million (33 cents per share). Sales for the quarter gained 6.4 percent to $8.06 billion up from $7.58 billion one year ago. Northfield, Ill.-based Kraft reports that new products, market share gains and price increases contributed to the higher sales. The company notes that the earnings gains came primarily through business sales (including U.S. yogurt operations), fewer restructuring charges and tax benefits; earnings from continuing operations were $699 million (41 cents per share). (Company report, Associated Press)

Parmalat Finanziaria SpA's U.S. subsidiary Farmland Dairies LLC ended its bankruptcy case last week with a plan to continue selling milk in New York, New Jersey and Michigan. Farmland has reorganized around its fresh milk and dairy products business in the Northeast and its national aseptic milk products business in Grand Rapids, Mich. The business will pay creditors and expenses with a $56 million loan from LaSalle Business Credit and a $45 million loan from General Electric Co.'s GE Commercial Finance unit. GE previously provided Farmland and Parmalat USA Corp. with $39 million in financing, and will receive a 70 percent stake in Farmland, all of its preferred stock, $11.6 million in litigation proceeds and up to $2 million in additional payments. (Company report, Bloomberg News)

Toronto-based CoolBrands International Inc. announced that its sales declined 17 percent to $87.5 million in the second quarter ending Feb. 28 of FY 2005. The net loss for the quarter was $3.97 million ($0.07 per share), compared with net earnings of $9.48 million ($0.17 per share) in the same quarter last year. Sales declines were attributed to the discontinued Weight Watchers Smart Ones brand, a drop in Atkins brand sales and increased competition for CoolBrands' superpremium pint brands. Net income was impacted by $6.2 million in write-downs, mostly related to the discontinued Weight Watchers Smart Ones business. The company reports its financials in U.S. dollars. (Company report)

Roberts Dairy Co. plans to close and sell its Des Moines, Iowa, milk processing plant and open a distribution center in the area. By early June, milk processing will shift to Omaha, Neb., and Iowa City, Iowa; products will be delivered daily to Des Moines. The Des Moines plant was built in 1954 by Flynn Dairy. The closure will eliminate about half of its 115 jobs, with workers to be offered available jobs at Roberts' plants in Kansas City, Iowa City and Omaha. (The Des Moines Register)

Montreal-based Saputo Inc. has completed its acquisition of the manufacturing, marketing and distribution activities of Fromage Cote S.A. and Distributions Kingsey Inc. for their pressed cheddar and cheddar cheese curd, Swiss-type cheese and other specialty cheeses. The purchase price is US$42.8 million. The cheese operation has annual sales of about US$89.9 million, with 400 employees, two processing plants, a cheese aging facility and a cutting/distribution facility. (Company report)

Dairy People News: Jim Oberweis, owner of Oberweis Dairy, plans to seek the Republican nomination for Illinois governor next year; it will be his third statewide campaign in as many elections, with two previous bids for the GOP nomination for U.S. Senate. (Chicago Tribune)

NEW PRODUCT TICKER

A new beverage called Liquid Cereal is a combination of fat-free milk and cereal blended into four flavors: fruit, apple and cinnamon, peanut butter, and chocolate. Sold in four-packs of 11-ounce cans, the drinks are fortified with calcium and vitamins A, C and D and carry the "Real" dairy seal. Each includes a cereal blend of yellow cornmeal, whole oat flour, rice flour and Splenda. The product is marketed by BrainTwist, a New York firm founded in February by former Coca-Cola consultant Larry Trachtenbroit. (Chicago Tribune, company report)

Brigham's Ice Cream, Arlington, Mass., is teaming up on its first co-branded ice cream product with Denham, Mass.-based party supply company iParty. The new ice cream, iParty No Bake Cake, has a golden cake mix-flavored base with swirls of chocolate frosting. It is one of about five new flavors Brigham's plans to launch this year. The iParty flavor is rolling out this month in supermarkets and some iParty outlets. (The Boston Herald)

Newport, Ken.-based Louis Trauth Dairy Inc., a division of Dean Foods, is rolling out Moose Tracks® Sundae Cones in supermarkets and convenience stores. The novelty is a vanilla ice cream sundae cone containing Moose Tracks fudge swirls and peanut butter cups. Packaging carries the logo of flavor developer Denali, as well as the "Original Moose Tracks" logo.

Dairy on the Menu: The Hardee's fast food chain is rolling out Hand-Scooped Ice Cream Shakes and Malts. Served in 16 oz. clear cups with a domed lid that accommodates a whipped topping, the drinks are made with hand-scooped ice cream, which is mixed with milk and flavored syrup. Flavors will initially include chocolate, vanilla, strawberry and peach, a seasonal variety. The offering is designed to fit in with the chain's plans to offer menu items that have the quality of sit-down restaurants' food. (restaurantbiz.com)

CUSTOMER CLIPS

Minneapolis-based Supervalu Inc. reports that its fiscal fourth-quarter sales dropped 8 percent to $4.59 billion from $5.04 billion, while earnings dropped 2 percent to $92.9 million (65 cents per share) from the year-ago quarter sales of $95.6 million (67 cents per share). Last year's quarter results included an extra week, which added about $360 million in sales and $9.9 million (7 cents per share) of earnings. For fiscal year ending Feb. 26, Supervalu posted earnings of $385.8 million ($2.71 per share) compared with $280.1 million ($2.01 per share) last year. Sales totaled $19.5 billion, down from last year's $20.2 billion. Supervalu is a distributor and a retailer, with chains including Shop 'n Save and Save-A-Lot. (Associated Press)

Family-run Meijer Inc., Grand Rapids, Mich., has shuffled its executive team. Former CVS Corp. exec Larry Zigerelli, hired in 2002, became president on April 1. Meijer's former president/COO Paul Boyer will become vice chairman and co-CEO. The founder's grandson, CEO Hank Meijer, becomes co-chairman and co-CEO. Meijer is in the middle of its first major expansion in three years, including new store designs with expanded grocery and non-food merchandise offerings. (Detroit Free Press)

Roundy's Inc. has agreed to buy Madison, Wis.-area independent Pick 'n Save stores from owner Gary Gundlach. Terms were not disclosed; the deal is subject to regulatory approval. It is the latest in the Milwaukee-based grocery chain's purchases of independent Wisconsin Pick 'n Save stores, as it refocuses on retail rather than wholesale operations. Roundy's also owns the Copp's food store chain in Madison. (Milwaukee Journal Sentinel)

IDFA NEWS

IDFA's Plant Operations Conference to Hit Chicago Next Week
There is still time to register for IDFA's Plant Operations Conference, set for April 26-27 in Chicago! This two-day program is designed to keep dairy plant operators and managers informed about innovations in technology and management practices that can help improve plant effectiveness. In addition, attendees will receive a thorough review about recent regulatory changes, including new labeling rules and the revamping of the food Good Manufacturing Practices (GMPs). A highlight of the program will be the presentation of this year's Dairy Industry Safety Awards, which will recognize plant facilities and trucking operations with outstanding worker safety performances. For complete agenda information, including the latest speaker additions, click here.

ODDS-AND-ENDS

Hershey Foods Corp. changed its name to The Hershey Co. on Tuesday, and the company unveiled a new logo that mimics the wrapping on its well-known Hershey's chocolate bar. The name change is part of the repositioning of the Hershey, Pa.-based company; plans include expansion into cookies, health bars and big-city retail stores. The company is aiming to have the ability to double the number of its shares to more than 1 billion to help finance future growth. (Associated Press)...Ben & Jerry's has rolled out a new on-package "Fair Trade Certified" icon on its Coffee, Coffee Heath Bar Crunch and Coffee Coffee Buzz Buzz Buzz flavors. About 400 companies now sell "fair trade" products, including Starbucks, Pete's Coffee, Dunkin' Donuts and Proctor & Gamble. Such goods include tea, chocolate, bananas, mangos, pineapples, rice and sugar, which are often high-end products that are also certified organic. There are 20 groups in the U.S., Canada, Japan and 17 European countries that can certify that products meet the standards of the Fair Trade Labeling Organizations International. (Associated Press)...After more than a half-century of business, Ware, Mass.-based Quality Milk ended its home delivery service at the end of March. The Rondeau family began processing and delivering milk in 1950. At its peak, Quality Milk processed 30,000 pounds of milk weekly and delivered milk and other dairy and juice products to 1,500 home, retail and school customers on a twice-weekly basis. Owner George Rondeau reports that at the time Quality Milk closed, the dairy had 400 customers in roughly a 25-mile radius of its former processing plant and cold storage facility. The company stopped processing milk about a year ago, and was sourcing glass-bottled milk from Mapleline Farm in Hadley, Mass. (Worcester Telegram & Gazette-Massachusetts)

STOCK MARKET TICKER

As of 4/19/05, market close.

Company/Symbol		Last Trade		Change over Previous Close		Change over Last Week's D-brief
Dean Foods/DF Dreyer's/DRYR General Mills/GIS Groupe Danone/DA Hershey Foods/HSY Ingles Markets/IMKTE 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*		34.84 80.92 48.50 19.28 61.89 13.62 31.52 15.37 23.40 20.87 36.22 33.68 39.80 38.50 19.18 N/A		+0.06 +0.19 -0.05 +0.13 +0.89 +0.20 +0.07 +0.10 +0.45 +0.10 +0.22 -0.08 +0.29 +1.35 +0.08 N/A		-0.49 +0.11 -1.06 -0.23 +0.71 +0.46 -1.36 -0.38 -0.47 +0.16 +0.24 -0.52 -0.33 +0.81 +0.05 N/A
*The New York Stock Exchange suspended trade of WIN as a result of the company's filing of its Chapter 11 petition on February 21, 2005. Source: Yahoo! Finance

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ABOUT D-BRIEF

D-brief is written by Dairy Field magazine, a Stagnito Communications Inc. publication, www.dairyfield.com. It is provided for the benefit of the industry by the International Dairy Foods Association (IDFA), www.idfa.org.

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