December 3, 2003

Great Lakes Cheese buys Wisconsin company...Earnings jump at CoolBrands...Land O'Lakes cheese to enter China's dairy cases...Kemps debuts new look, line items...Roundy's to build new distribution center...Supermarket labor disputes update... Global Dairy Watch...Odds-and-Ends...Stock Market Ticker...More news at www.idfa.org.

DAIRY BUSINESS BRIEFS

Great Lakes Cheese Co., Hiram, Ohio, acquired Lemke Cheese and Packaging, Wasau, Wis., in a deal closed Nov. 19. Terms were not disclosed. Lemke's Wausau, Wis., packaging plant will retain its name, as well as 200 employees. Former Lemke co-owner Dan Zagzebski will oversee the Wausau division with John Epprecht, Great Lakes Cheese v.p. of packaging. (Crain's Cleveland Business)

A 47% increase in fiscal 2003 sales and a 51% jump in 2003 earnings for CoolBrands International Inc. is largely attributed to the Toronto-based company's 2003 acquisition of various frozen dessert brands and distribution rights in the Dreyer's/Nestlé merger. CoolBrands' sales for the fiscal year hit US$275.3 million, compared to US$186.6 million in fiscal 2002. Earnings reached US$24.4 million in fiscal 2003, compared to US$16.2 million in fiscal 2002.

Arden Hills, Minn.-based Land O'Lakes Inc. will introduce 30-plus products (including cheese, cream cheese and sour cream) to China, becoming the first U.S.-based cheesemaker to enter China's retail market. LOL also plans to open small Land O'Lakes delis with promotions including free samples. The country currently imports between 6,000 to 7,000 tons of cheese annually from Australia, New Zealand and European countries. The growth of quick-service restaurants featuring pizza and hamburgers is driving increased cheese consumption. World Trade Organization commitments will lower China's cheese tariffs from 50% to 12% on Jan. 1, 2004; ice cream tariffs will drop from 45% to 19%; and yogurt tariffs will fall from 45% to 10% percent. The United States is the fourth largest exporter of dairy products to China. (Business Daily Update/Global News Wire)

Minneapolis-based Kemps debuts a new look as well as line extensions for its ice cream sandwich line. The packaging redesign includes color-coded product segments as well as enhanced graphics and typography. To ease retailer display needs, the packages can be slotted with a full facing or any one of three side panels. New products include reduced-fat, sugar-free and chocolate ice cream sandwiches.

CUSTOMER CLIPS

Milwaukee-based Roundy's Inc. will open an $80 million, 950,000-sq.-ft. warehouse and distribution center in 2005 to serve its stores in southeastern Wisconsin, the Madison, Wis.-area and Minneapolis-St. Paul. The new center in Oconomowoc, Wis., will be located near the chain's 1.1 million-square-foot regional distribution center for Target Stores Inc.; a smaller distribution center in Wauwatosa, Wis., will close. Roundy's recently moved its headquarters to downtown Milwaukee from Pewaukee, Wis., has added 51 stores in the last 12 months, and plans to open seven new Milwaukee-area stores by March. (Associated Press)

Supermarket labor disputes update: Last week about 9,000 Teamster drivers, warehouse workers and office clerks refused to cross picket lines at distribution centers for Safeway Inc. (Vons and Pavilions), The Kroger Co. (Ralphs) and Albertsons Inc. in Southern California. Supermarket chains' contingency plans kept stores stocked and open as scheduled for the holiday period. The United Food & Commercial Workers union clerks additionally expanded pickets to Safeway stores in the District of Columbia and Maryland this weekend. Meanwhile, a financial pact by the three supermarket chains to share profits during the work action is under investigation for possible anti-trust violations by California's attorney general. Resumption of negotiations with a federal mediator is expected this week. (Associated Press; Los Angeles Daily News)...In West Virginia, Kroger clerks involved in the work action will receive unemployment benefits of up to $358 a week; employees in Ohio and Kentucky have been denied unemployment benefits. UFCW will reduce strike benefits by $50 a week in West Virginia to increase benefits in Ohio and Kentucky. (National Public Radio)

GLOBAL MARKETWATCH

Talks between Groupe Danone SA and Wimm-Bill-Dann OJSC that would have placed the majority share of the Russian dairy and food company under the French company's wing have ended amicably. Danone had hoped to buy major blocks of stock from WBD company management in a deal underway since June that valued WBD at more than $1 billion. Danone reports it will maintain its current holdings of 7.2% of WBD shares. (Dow Jones Business News)

Canada's Saputo Inc. reports its $50.8 million deal to buy the third largest dairy processor in Argentina was finalized Friday. Molfino Hermanos S.A. posts annual sales of about $90 million, with 40% of sales attributed to exports of milk powder and cheeses to more than 30 countries. Molfino has two processing facilities and 850 employees; products include soft, semi-soft, hard and grated cheeses as well as butter, cream, UHT milk, dulce de leche (caramelized milk) and milk powder.

IDFA NEWS

Registration Now Open for 2004 Dairy Forum!
Registration is now open for the 2004 Dairy Forum, January 18-21, at the Boca Raton Resort and Club in Boca Raton, Fla. This annual event provides a unique opportunity for key players from all sectors of the dairy industry - processors, producers and suppliers - to discuss the most pressing issues facing the industry. Session topics will focus on strategies for driving market profitability, joint processor-producer efforts to increase dairy consumption, and the government's role in the market. In her first industry speech as president and CEO of IDFA, Connie Tipton will deliver the keynote address about "Risk Success" on Monday morning, January 19. Immediately following, there will be an in-depth discussion about issues and politics during an important election year with key congressional leaders. Make sure to reserve your spot now at this important conference! For more information, or to register, click here.
http://www.idfa.org/meetings/2004dairyforum.cfm

ODDS-AND-ENDS

The Wisconsin Milk Marketing Board's free holiday recipe booklet "Eat, Drink and Have Dairy," offers a taste of the past with traditional recipes interspersed with nostalgic anecdotes about local food and traditions. The booklet is offered free at participating grocery stores with a purchase of a dairy product. It can also be ordered online or via a toll-free number...Baraboo, Wis.-based Foremost Farms USA will offer nine, $1,000 scholarships to member-owners and the children of member-owners in 2004. The scholarships will be awarded in the spring of 2004 to students pursuing agricultural-related careers. One of the nine scholarships was established by Don and Lois Storhoff; Don Storhoff retired as president of Foremost in 2001...Pittsburgh's Reinhold Ice Cream Co. offers ice cream lovers a chance to custom design flavors delivered in personalized-labeled containers in less than a week. The company's Web site at http://www.customicecreamcreations.com allows customers to specify any flavor, custom inclusion or color scheme they can dream up and Reinhold can procure. The minimum order of three and a half gallons (about 70 servings) runs about $80, including shipping. Reinhold has about $14 million in annual sales; its traditional products are distributed in Ohio, West Virginia and the western half of Pennsylvania. (Associated Press)

STOCK MARKET TICKER

As of 12/02/03, 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 Horizon Organic/HCOW 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		24.87 33.09 77.25 45.45 31.47 78.13 23.90 10.18 32.22 18.27 16.95 20.25 27.10 25.69 35.07 33.75 17.58 08.62		+0.23 +0.18 -0.07 +0.06 +0.12 +0.63 -0.07 +0.03 +0.41 -0.26 -0.19 +0.00 -0.30 -0.47 -0.26 +0.16 -0.39 -0.07		+0.62 +1.08 -0.31 +0.94 +1.00 +0.88 +0.00 +0.17 +1.22 +0.38 +0.20 +0.15 -0.85 +1.34 +0.57 +1.22 -2.02 +0.75
Source: Yahoo! Finance

** D-brief was not published last week in observance of the Thanksgiving holiday; changes are in comparison to the November 19 issue.

Click here to view last week's edition of D-brief.
http://www.idfa.org/dbrief/archive.cfm

ABOUT D-BRIEF

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