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Feb 10, 2000 - 09:43 PM

Vlasic Foods, Hit by High Costs and Low Sales, Restructures Headquarters

The Associated Press

CHERRY HILL, N.J. (AP) - Vlasic Foods International warned Thursday it would post a loss for the fiscal second-quarter and is hiring an investment bank to explore strategic alternatives.

The maker of condiments, frozen dinners and other food products said Thursday it also will reduce staff at its suburban Philadelphia headquarters by 20 percent, or about 45 positions.

For the quarter ended Jan. 31, the company expects to record a loss of 32 to 36 cents per share. Analysts surveyed by First Call/Thomson Financial had expected the company to earn 6 cents per share.

The results are to be released Feb. 29.

The loss mainly was due to special charges from changes in promotional campaigns related to the company's spinoff from Campbell Soup Co. nearly two years ago, Vlasic said.

Also, sales of its Swanson frozen foods and Vlasic lines, while up 3 percent, were lower than expected. The slump was likely to continue - and to hurt earnings - for the rest of the year, Vlasic said.

"While we continue to see increases in our frozen food and condiments businesses, particularly in our pickles, pot pies and dinners businesses, we had expected more robust overall growth," said Robert F. Bernstock, president and chief executive officer. "These lower than expected levels of sales are likely to continue and impact our earnings for the remainder of the year."

Meantime, Vlasic is taking several steps to improve its position, such as combining all its North American businesses into a single unit and naming an interim chief financial officer, Peter Menikoff.

The company also will explore strategies such as joint ventures, acquisitions, or selling all or part of its business.

-- snooze button (alarmclock_2000@yahoo.com), February 10, 2000

Answers

Sounds like they're in a pickle...

-- dinosaur (dinosaur@williams-net.com), February 11, 2000.

I bought lots of their pickles for Y2K--guess it wasn't enough ;-)

-- cgbg jr (cgbgjr@btv.net), February 11, 2000.