Uncle B's Bakery Announces Existing Contract with Heinz
Bakery Products Mutually Canceled; Replaced with New
Strategic Development Partner Agreement
PR Newswire - May 28, 1997 14:30
FINANCIAL UNCB FOD CON V%PRN P%PRN
ELLSWORTH, Iowa, May 28 /PRNewswire/ -- Uncle B's Bakery, Inc.'s
(Nasdaq: UNCB) Chairman and CEO William T. Rose, Jr. announced today that the
Company and Heinz Bakery Products have mutually canceled their existing
contract to produce frozen raw dough bagels. This action has been taken
because of problems encountered with ingredients supplied by outside suppliers
which impacted the company's ability to deliver product. In addition, Uncle
B's believed it should not absorb the additional costs of customer
specification changes not contained in its original agreement.
Rose stated, "At the same time, Uncle B's and Heinz have executed a
Strategic Development Partner Agreement whereby Heinz desires that Uncle B's
be its preferred supplier of par baked and fully baked bagels." The new
agreement utilizes the company's expertise and is for a term of three years
with no guaranteed volumes.
Previously the company had announced that sales for fiscal year ending
July 31, 1997, would be increased as much as 40-50%. The company now
anticipates sales for the fiscal year will only increase in the range of
18-20%. Both the sales and net income for the third and fourth quarters will
be adversely affected with the major sales impact occurring in the fourth
quarter.
The company wishes to caution the public, that the foregoing discussion
contains forward looking statements that involve risk and uncertainties that
could cause results to differ materially from those discussed.
Uncle B's Bakery produces and markets the "Uncle B's" and "Millspring"
brands of never frozen bagels. The Company's products are an alternative to
frozen bagels and are currently available in 11,000 supermarkets in 43 states.
Uncle B's is traded on the Nasdaq Small Cap Market under the symbol UNCB.
SOURCE Uncle B's Bakery, Inc.
CONTACT: Wm. Howard McClennan, Jr., CFO of Uncle B's Bakery, Inc.,
515-836-4000, fax 515-836-4446 |
