Flowers revises long-term growth and earnings targets

by World Grain Staff
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Allen Shiver Flowers Foods Inc.
Allen L. Shiver, president and CEO of Flowers Foods.

THOMASVILLE, GEORGIA, U.S. — Flowers Foods, Inc. has revised several long-term goals that the company believes will deliver total shareholder returns of more than 10%, including revising its sales growth goal to a range of 2% to 4% (down from 3% to 5%); EBITDA margin to 12 % to 14% (from 11% to 13%); and earnings per common share of 8% to 10% (from double-digit growth). The goals were unveiled April 13 as part of the company’s investor briefing at the New York Stock Exchange.

“Going forward, we are focused on developing our existing geographic footprint, driving growth from our organic brands and other underdeveloped segments, and improving promotional and operational efficiencies,” said Allen L. Shiver, president and chief executive officer of Flowers Foods. “While our revised long-term targets now exclude acquisitions, M&A will continue to be an important part of our growth strategy as we seek to identify opportunities that expand our margins and enhance our brand portfolio.”

Flowers also reaffirmed its sales and earnings guidance for fiscal year 2016, continuing to expect sales in the range of $3.986 billion to $4.080 billion, representing growth of approximately 5.5% to 8% over fiscal 2015. The company also maintained its guidance for EPS of 98¢ to $1.04, excluding accretion related to the Accelerated Share Repurchase (ASR) announced in March 2016. On a full-year basis, the company expects the ASR to be accretive to EPS by approximately 2¢ to 3¢ per share.

In addition to its earnings update, Flowers Foods said it will be launching the national roll-out of organic Dave’s Killer Bread (DKB) on its direct-store delivery network beginning April 25. The initiative is expected to allow approximately 85% of the U.S. population better access to fresh DKB products, while the addition of approximately 9,000 new store locations for DKB products positions the brand for growth in the specialty premium bread segment.

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