News | January 27, 2000

Ben & Jerry's Still Not Talking on Takeover; Novelties to Be Outsourced by July

Ben & Jerry’s Still Not Talking on Takeover; Novelties to Be Outsourced by July
By Bob Sperber

Mum's still the word on a takeover of Ben & Jerry's Homemade Inc. "No decision has been made by the board with respect to any of these indications of interest or as to any sale of the company," said a statement yesterday from the Vermont ice cream company.

The company's shares jumped to a high not seen in months on the news, in early December, that an unnamed—Nestle? Unilever?—suitor made an offer to acquire the company. (See related article).

Since then, the company's stock (Nasdaq: BJICA) has been on a bumpy ride. Company shares on the Nasdaq exchange are currently, midday Jan. 27, teetering in the low 20s on the Nasdaq Stock Market. (See 12-month chart, Jan. 26 closing).

Higher fourth-quarter sales edged past Wall Street profit predictions for 1999. 1999 sales were $237 million, up 13% from $209.2 million in 1998. Fourth-quarter earnings totaled $1 million, or 14 cents a share, compared with $840,000, or 11 cents a share, a year earlier.

These earnings, however, do not include a restructuring charge for the cost of shutting down a Springfield, VT, plant producing chocolate-covered bars and other novelty products. The company said plans to sub-contract this production effective during July, 2000.

"We're shifting our novelty production to an outside contractor," said Christine Heimert, company spokesperson. "That's the only plant that's affected, and it only includes our novelties." All 25-252530 employees working at the plant have been offered relocation packages to work at one of the company's other Vermont sites and those who opt out will be eligible for an alternate compensation package.

On the financial front, a story by the Associated Press story today cited an analyst surveyed by First Call/Thomson Financial that expected lower fourth-quarter earnings of 11 cents a share. Including the above restructuring charge, Ben & Jerry's reported a $4.56 million fourth-quarter loss (64 cents a share). However, sales for the quarter were up to $51.68 million vs. $44.33 million a year earlier, riding on higher sales in the United Kingdom and an increase in ice cream pint sales in the United States.