May 19, 2004

Dreyer's to build largest U.S. ice cream plant .... Parmalat restructuring plans .... Associated Milk Producers closes plant .... Elsie the Cow returns .... New Brigham's flavor .... Colombo Yogurt celebrates .... Wal-Mart profits jump .... Kmart posts profitable quarter .... BJ's quarterly income up .... Washington Conference .... Odds-and-Ends .... Stock Market Ticker .... More news at www.idfa.org.

DAIRY BUSINESS BRIEFS

Oakland, Calif.-based Dreyer's Grand Ice Cream broke ground last week on an expansion of its current plant in Bakersfield, Calif., that will transform the facility into the nation's largest ice cream plant. The $100 million, 400,000-sq.-ft. expansion will double the facility's size, triple its capacity to about 100 million gallons a year and add 250 jobs. The larger facility will add five production lines to produce Dreyer's Grand and the new Slow Churned Dreyer's Grand Light ice cream. Dreyer's merger with Nestle had brought Dreyer's four new plants in California, including the one in Bakersfield. This expansion follows the shutdown of a plant in Union City, Calif., in February. (Los Angeles Times)

The restructuring plan of insolvent Parmalat Finanziaria SpA calls for the creation of a new company, which would be partly owned by creditors, to retain the Italian dairy's debt and assets. The proposal is part of the company's turnaround plan that will be released later this month by Enrico Bondi, the government-appointed administrator of Parmalat. Stateside, Parmalat USA, Wallington, N.J., is also planning to reorganize, since it is unable to find a suitable buyer. Speculation is that antitrust concerns scared off strategic buyers or drove down the price. The U.S. reorganization will center on assets in New Jersey, New York and possibly the subsidiary of Milk Products of Alabama LLC. Overall, Parmalat's sales figures have stayed relatively strong despite the financial scandal. Sales for the first four months of the year totaled $1.89 billion as of April 30, down from $2.14 billion during the same time the previous year. Earnings during the period increased to $67.6 million, up from $63.5 million a year ago. Meanwhile, Italian prosecutors are preparing their second attempt to indict Parmalat founder Calisto Tanzi and others associated with the scandal. In other news, the European Union (EU) announced that no aid would be available for Italian milk producers hurt by the company's situation, since EU regulations make no provision for responding to crisis situations in the farming sector. (The Daily Deal; Associated Press)

New Ulm, Minn.-based Associated Milk Producers Inc. (AMPI) closed a plant in Glencoe, Minn., as the state continues to lose dairy production. In mid-June, milk processed at the Glencoe plant will be diverted to the four remaining AMPI plants in Minnesota. The plant's 30 employees will be transferred to the other plants. The state's milk production totaled 688 million pounds in April, down 3.5% from the same time a year ago. (St. Paul Pioneer Press)

MARKETING MIX

Borden's first national print campaign in years will bring back a familiar face. Elsie the Cow will be the main attraction in the campaign that is designed to introduce the cheese brand to a new generation of consumers, particularly mothers worried about their kids' calcium intake. Ads make their debuts in June in titles such as Woman's Day and Good Housekeeping. As part of the campaign, consumers will be invited to adopt a real cow at Elsie.com. Elsie first appeared in the 1930s for Borden, which is now owned and operated by the Plymouth, Wis.-based branch of Dairy Farmers of America. (Brandweek)

The Boston Red Sox, believed to be bedeviled by the 85-year-old "Curse of the Bambino" that prevents a World Series victory, may get some help from Brigham's Ice Cream's new "Reverse The Curse" flavor. Arlington, Mass.-based Brigham's launched the flavor at a rally held at a local processing plant that included two psychic advisors and the Bambino himself, Babe Ruth (as played by Willis Gardner). The flavor consists of vanilla ice cream, chocolate-covered peanuts, caramel and fudge swirls; it will be renamed when the Red Sox take home the national title. (Company report)

Colombo Yogurt celebrates two milestones -- its 75th anniversary this month and the 75th anniversary of the introduction of yogurt to America -- with a new TV campaign. Originating in the Middle East, yogurt reportedly made its debut in America in 1929 via Rose and Sarkis Colombosian, an immigrant family who settled in Massachusetts and formed the Colombo & Sons Creamery. The brand is now part of General Mills' Yoplait USA unit. Featuring founding family member Bob Colombosian and his wife Alice, the ads will appear starting in June in select Northeast markets. (Company report)

CUSTOMER CLIPS

First-quarter profits at Wal-Mart Stores Inc., Bentonville, Ark., jumped 18.4% over the same period for last year. Earnings total $2.2 billion in the first quarter, up from $1.8 billion last year. Total net sales hit a record $64.8 billion, a 14.2% increase from $56.7 billion a year earlier. Specifically, sales in U.S. Wal-Mart stores, including supercenters, reached $43.6 billion in the year's first quarter, up from $38.6 billion in 2003. Wal-Mart will continue to expand with up to 240 new supercenters planned this year. (Arkansas Democrat-Gazette)

Troy, Mich.-based Kmart Holding Corp. posted its second straight profitable quarter since coming out of bankruptcy. Kmart generated $93 million in profits in the first quarter. During the same period last year, Kmart lost $862 million while it was in bankruptcy prior to its reorganization. According to the company, most of the gains came from improved productivity and cost cuts, rather than increased sales at stores open at least a year ("same-store" sales). In fact, same-store sales continued to wane, sliding 12.9% from last year. Total sales for the period totaled $4.62 billion, down 25.3% from $6.81 billion for the same time last year. Kmart blames the weak figures partly on the closure of 316 stores last year. (Associated Press)

BJ's Wholesale Club Inc., Natick, Mass., posts net income of $16.1 million in its first quarter, a 43% jump in profit over the same period last year. Quarterly revenues rose 12% to $1.65 billion, up from $1.47 billion in 2003. First-quarter same-store sales increased 6.6%. Food sales at these stores rose 9%, while general merchandise sales rose 4%. (Associated Press)

IDFA NEWS

Key Senate Leader to Address Washington Conference PAC Breakfast
IDFA is pleased to announce that Senator George Allen (R-VA) will be the featured speaker at the PAC Breakfast during this year's Washington Conference, June 23-34. Elected to the Senate in 2000 after serving as Virginia's governor, Sen. Allen has become a dominant force in Congress, where he holds a seat on three influential committees. In addition, as chairman of the National Republican Senatorial Committee, he is in charge of the Republican Party's efforts to build on the majority in the Senate in the November elections. Sen. Allen's address is among the many highlights of the Washington Conference program for PAC contributors; for more information or to register, click here. http://www.idfa.org/meetings/washconf2004_agenda.cfm

ODDS-AND-ENDS

London-based Unilever named John W. Rice as president and chief executive officer of Unilever United States, New York, N.Y. Rice will continue to serve as president and CEO of Unilever Bestfoods North America, Englewood Cliffs, N.J. In other news, outgoing Unilever chairman Niall FitzGerald unveiled a new corporate logo and mission statement at the company's annual meeting May 12. A major focus of its mission is to meet increasing consumer demands for a healthy lifestyle, convenience and indulgence through nutrition, hygiene and personal care products. (Company report) .... Land O'Lakes, Arden Hills, Minn., introduced a new nutrition program in Honduras that aims to feed 4,500 students in 58 schools. The Dairy Enterprise Initiative will distribute 520,000 rations of milk, corn tortillas and cheese over a six-month period. Two local processors will donate the milk. (Company report) .... Investigators determined that an overheated 150-watt light bulb started the May 10 fire at the Velvet Ice Cream factory in Utica, Ohio. (Columbus Dispatch) .... The Osbournes have infiltrated the ice cream market. Two new flavors from Country Cow Creamery, Westbridge, N.J., honor the rocker Ozzy Osbourne and his wife Sharon, both of whom signed off on the new flavors. "Death by Sharon" is a dark chocolate ice cream with fudge and brownie bits soaked in Godiva liqueur, and "Ozzy's Carnivorous Carrot Cake" is cinnamon spice ice cream with inclusions of carrot cake soaked in hazelnut liqueur. (Associated Press)

STOCK MARKET TICKER

As of 5/18/04, 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		28.16 33.85 78.94 45.81 33.20 89.38 10.59 30.61 16.60 20.39 21.33 32.01 30.47 37.63 33.12 15.57 06.00		+0.12 +0.24 +0.05 -0.07 -0.15 +0.51 -0.06 -0.30 +0.23 +0.15 +0.08 +0.73 +0.36 +0.58 +0.20 -0.07 -0.14		-0.62 -0.50 -0.05 -0.91 +0.50 +0.55 -0.44 -0.98 -0.55 -0.46 -0.87 +0.36 +0.47 +0.13 -0.37 -0.55 -0.85
Source: Yahoo! Finance

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