Heinz Explores Sale of European Seafood, Frozen and Chilled Food Businesses
London (ots/PRNewswire)
H. J. Heinz Company (NYSE: HNZ) at a meeting with security analysts in Pittsburgh today further discussed the potential sale of its European Seafood and European Frozen and Chilled Food businesses over the next 6 to 12 months.
Heinz Europe President and CEO Joe Jimenez today outlined the expected benefits of the transformation plan: "Selling the European Seafood and Frozen & Chilled Food businesses would be a major step in our plan to further enhance sales and earnings growth in Europe. Our plan is to invest in three core product categories where Heinz is a market leader: ketchup, condiments & sauces; meals & snacks; and infant nutrition. This strategy will result in a step-change improvement in performance, mirroring the great success we have achieved with a similar plan in North America instituted in Fiscal 2003.
Joe Jimenez also commented: "After the potential divestitures, Heinz Europe would be a leaner, more nimble, world-class competitor, driving big brands in three core categories, with market leading positions. We believe our plan to focus on driving growth in our three core product categories will enhance top-line and bottom-line growth, will improve margins and lessen volatility in our financial performance."
The European Seafood and European Frozen & Chilled Food businesses are good branded businesses with talented management. Their value is expected to be maximized under new owners who would view them as core businesses in which to invest for the long term.
If the European Seafood and European Frozen Food businesses were to be sold, Europe would remain the second-largest market for Heinz, after North America. Following the potential divestitures, Europe would have sales of approximately $2.5 billion and approximately 8,000 employees at 24 Heinz facilities.
Heinz has retained the services of UBS and J. P. Morgan & Co. to assist with the potential sale of its Frozen Food and Chilled businesses in the U.K. and Ireland, France and the Nordics, and its European Seafood business, which includes the John West(R), Petit Navire(R) and Mareblu(R) brands and seafood canning and processing facilities in The Seychelles, Ghana, France and Portugal. In the past fiscal year, these businesses had combined sales of $1.1 billion. They have 7,100 employees at 10 manufacturing facilities, including 4,800 in the seafood operations and 2,300 in the U.K. and Ireland.
Heinz European employees were notified about the next phase of the strategic review today. Mr. Jimenez said customers can expect the European Seafood and European Frozen Food businesses to maintain the highest standards of quality and customer service during this exploration period. Additionally, it would be business as usual in terms of Heinz's investment and management of these businesses during the review period.
SAFE HARBOR PROVISIONS FOR FORWARD-LOOKING STATEMENTS:
This press release contains forward-looking statements within the meaning of the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements reflect management's view of future events and financial performance. These statements are subject to risks, uncertainties, assumptions and other important factors, many of which may be beyond Heinz's control and could cause actual results to differ materially from those expressed or implied in these forward-looking statements. Uncertainties contained in such statements include, but are not limited to, sales, earnings, and volume growth, general economic, political, and industry conditions, competitive conditions, which affect, among other things, customer preferences and the pricing of products, production, energy and raw material costs, the ability to anticipate and respond to consumer trends, the need for product recalls, the ability to maintain favorable supplier relationships, achieving cost savings and gross margins objectives, currency valuations and interest rate fluctuations, the ability to identify and complete and the timing, pricing and success of acquisitions, joint ventures, divestitures and other strategic initiatives, the ability to effectively integrate acquired businesses, new product and packaging innovations, product mix, the effectiveness of advertising, marketing, and promotional programs, supply chain efficiency and cash flow initiatives, risks inherent in litigation and international operations, particularly the performance of business in hyperinflationary environments, changes in estimates in critical accounting judgments and other laws and regulations, including tax laws, the success of tax-planning strategies, the possibility of increased pension expense and contributions and other people-related costs, the possibility of an impairment in Heinz's investments, and other factors described in "Cautionary Statement Relevant to Forward-Looking Information" in the Company's Form 10-K for the fiscal year ended April 27, 2005. The Company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by the securities laws.
ABOUT HEINZ: H.J. Heinz Company, offering "Good Food, Every Day(TM)," is one of the world's leading marketers and producers of branded foods in ketchup, condiments, sauces, meals, soups, seafood, snacks, and infant foods. Heinz satisfies hungry consumers in every outlet, from supermarkets to restaurants to convenience stores and kiosks. Heinz is a global family of leading brands, including Heinz(R) Ketchup, sauces, soups, beans, pasta and infant foods (representing nearly one-third of total sales or close to $3 billion), HP(R) and Lea & Perrins(R), Ore-Ida(R) french fries and roasted potatoes, Boston Market(R) and SmartOnes(R) meals, and Plasmon(R) baby food. Heinz's 50 companies have number-one or number-two brands in 200 countries, showcased by Heinz(R) Ketchup, The World's Favourite Ketchup(TM). Information on Heinz is available at www.heinz.com/news.
Note to European Editors:
European Frozen& Chilled
The European Frozen business includes the following brands: Heinz, Ross, Weight Watchers from Heinz, Aunt Bessie's (under license to Tryton Foods), Linda McCartney (under license), Devonshire, American Dream, Harry Ramsdens (under license) Chip Shop (under license), Weight Watchers International (under license). Heinz acquired the majority of its UK frozen business from United Biscuits in 1999. The frozen and chilled business employs about 2,300 people.
The frozen production sites that will be part of the sale process are:
1) Fakenham, Norfolk, England (220 employees)
2) Leamington, Warwickshire, England (375 employees)
3) Okehampton, Devon, England (400 employees)
4) Westwick, Norfolk, England (215 employees)
5) Dundalk, Ireland (315 employees)
6) Luton, Bedfordshire (500 employees)European Seafood
The European Seafood business includes the following brands: John West (UK), Petit Navire (France), Mareblu (Italy), Parmentier (France), Marie Elisabeth (Portugal) brands. The businesses employ about 4,800 people. Heinz acquired John West, which is based in Liverpool, in 1997.
The European Seafood production sites that will be part of the sale process are:
1) Mahe, Seychelles (2,400 employees)
2) Peniche, Portugal (350 employees)
3) Tema, Ghana (1800 employees)
4) Douarnenez, France (200 employees)Contact:
Michael Mullen, Director of Corporate Affairs, +44-208-848-2403 or
Michael.mullen@uk.hjheinz.com