TIDMSRL
Sara Lee Corp. (NYSE: SLE) today revealed its strategy for its
North American foods business, Hillshire Brands Company, which
emphasized new product development, marketing investment and
disciplined cost control. Management expects its strategy to
deliver annual revenue growth of 4-5 percent and an operating
margin of 10 percent by fiscal year 2015 and have a near-term
dividend payout ratio of 30-35 percent. The new name of the
company, announced earlier today, will become effective after the
June 28, 2012 spin-off to shareholders of its international coffee
and tea business.
"We envision making Hillshire Brands Company the most innovative
meat-centric food company in the U.S.," said Sean Connolly, chief
executive officer of Sara Lee Corp.'s North American Retail and
Foodservice business, who becomes Hillshire Brands Company's CEO
after the spin-off. "We begin life in a dynamic sector as a major
player with four iconic mainstream meat brands - Jimmy Dean, Ball
Park, Hillshire Farm and State Fair - and our two artisanal brands
- Aidells and Gallo. They position us well and provide tangible
opportunity for growth in value-added products.
"We intend to produce robust shareholder return by strengthening
our core brands and expanding into adjacent food categories,"
Connolly added. "With a relentless focus on consumer needs, we will
leverage our marketing discipline and our market insights to
develop inventive new products, while financing our innovation and
increased marketing investment through enhanced margins and
operational efficiencies."
During the day, Connolly and Maria Henry, chief financial
officer of Sara Lee Corp. North American Retail and Foodservice,
who becomes Hillshire Brands' chief financial officer after the
spin-off, outlined Hillshire Brands' four drivers of
profitability:
-- Higher revenues through innovation and increased brand support
-- Improved gross margins through new, higher-margin products, brand
strength differentiation, and productivity
-- Increase marketing, advertising, and promotion (MAP) to five percent
of revenue by fiscal year 2015 and make it more-effective
-- Further cost and productivity programs including a three-year plan to
save $100 million and investment in insights and innovation to
manage
selling, general and administrative (SG&A) expenses
"Hillshire Brands starts its existence with a strong,
investment-grade financial position and a track record of solid
performance," said Henry. "Achieving our fiscal year 2015 revenue
growth and operating margin targets will create real incremental
value in our company."
The investor day session also included presentations by top
executives, including:
-- Andy Callahan, president, retail, explained how Hillshire Brands will
apply its core principles to grow its brands and demonstrated
the
company's track record for creating dynamic new categories
through
innovation and brand-building.
-- Jeff George, senior vice president, R&D, showed the science behind
Hillshire Brands' product advances and the unique appeal of
high-protein, meat-based foods to consumers.
-- Tom Hayes, chief supply chain officer, described how Hillshire Brands'
supply chain will support growth and innovation, the
company's
commitment to food safety and opportunities for continued
operating
improvements.
"Our entire organization is excited about unleashing the
potential of our employees as a more-focused and agile company, and
releasing the potential of our brands with superb consumer and
shopper insights and strong retailer positions," Connolly
concluded.
To view and download the slides and an audio record and
transcript of Hillshire Brands' investor day presentation, visit
the Investor Relations section of the Sara Lee corporate website
(www.saralee.com).
About Sara Lee Corporation
Sara Lee Corp. (NYSE: SLE) and its leading portfolio of food and
beverage brands, including Ball Park, Douwe Egberts, Hillshire
Farm, Jimmy Dean, Pickwick Teas, Sara Lee and Senseo, generate
nearly $8 billion in annual net sales from continuing operations
and employ approximately 20,000 people worldwide. In January, 2011,
Sara Lee Corp. announced that it will divide the company into two
pure -play publicly traded companies, one focused on the
international coffee and tea market and the other on North American
meats. For more information on the company, please visit
www.saralee.com.
Photos/Multimedia Gallery Available:
http://www.businesswire.com/cgi-bin/mmg.cgi?eid=50300611&lang=en
Sara Lee CorporationMedia: Mike Cummins,
+1.630.598.8412Analysts: Melissa Napier, +1.630.598.8739
Sara Lee Corp (LSE:SRL)
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