News | July 27, 2000

Dreyer's ups profits, sales

Citing ice-cream sales growth and boosted operating margins, Dreyer's Grand Ice Cream Inc. realized a more-than 50% profit jump for its FY 2000 second quarter.

The Oakland, CA-based company reported that for the quarter ended June 24, its sales rose 6% to reach roughly $323.82 million vs. $306.86 during the same period a year ago. Net income enjoyed a 52% increase, hitting nearly $12.52 million compared to $8.23 million during FY '99's second quarter.

"Sales of the company's branded products increased 17% in the quarter, led by strong sales of superpremium Dreamery, the national rollout of our co-branded M&M/Mars line, and substantial increases in the sales of premium Dreyer's and Edy's Grand Ice Cream and Whole Fruit Bars," Dreyer's leaders said. "While the industry ‘better for you' segment continued to decline in the quarter, sales of the company's portfolio of ‘better for you' products, including Dreyer's and Edy's Grand Light, Frozen Yogurt, Sugar Free and Fat Free flavors, increased 1%."

However, the corporation's partner brands sales suffered a 15% dip, prompted "almost entirely" by decreased sales of Ben & Jerry's Homemade Inc. products, company leaders said. Under a revised agreement effective last September, Dreyer's reportedly went from distributing 70% of the Vermont company's products to only 20%. Partner brand sales represented 29% of sales during the second quarter, Dreyer's leaders said, down from 36% the same period during 1999. However, the Dreamery ice cream line has reportedly been hampering Ben & Jerry's financials as the two companies go head to head in the superpremium arena.

In addition, Dreyer's announced the closing of a $240 million five-year revolving line of credit with a Bank of America-led syndicate of banks.

"This new facility will give us significant financial and strategic flexibility and demonstrates growing confidence from the credit community in the Dreyer's growth story," Dreyer's Chairman T. Gary Rogers said.

Edited by Gerry Clark