SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
Form 8-K
Current Report Pursuant
to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of report (Date of earliest event reported): September 26, 2000
THE EARTHGRAINS COMPANY
(Exact Name of Registrant as Specified in its Charter)
Delaware
(State or Other Jurisdiction of Incorporation)
1-7554 36-3201045
(Commission file Number) (I.R.S. Employer Identification No.)
8400 Maryland Avenue, St. Louis, Missouri 63105
(Address of Principal Executive Offices) (Zip Code)
(314) 259-7000
(Registrant's Telephone Number, Including Area Code)
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5. Other Events
The Earthgrains Company announced on September 26, 2000 that earnings for
the second quarter will fall below analyst expectations because of strike-
related costs and revenue impacts.
Earthgrains continued operating bakeries and serving markets during the
strike to protect customer relationships, incurring significant incremental
costs for overtime, temporary labor, security, travel, purchased goods, and
transportation and distribution. The strike impact is expected to lower
earnings by approximately $0.13 per diluted share in the quarter that ended
September 12, 2000.
The range of earnings estimates for the quarter, excluding the strike
impact, is $0.32 to $0.36 per diluted share. Before the strike, Earthgrains
was performing according to plan, and earnings were projected to have been
within the range of analyst estimates. The integration of the Metz Baking
Co. operations acquired in March 2000 continues on track.
The strike, which began August 26 in Fort Payne, Ala., ended September 22
with the ratification of a new three-year agreement. Employees engaged in
work stoppages at 23 bakeries for all or part of 18 days in the second
quarter. Those bakeries and an additional four bakeries were impacted from
one to 10 days in the 16-week third quarter, which ends January 2, 2001.
Incremental spending for strike-related expenses substantially ended
September 25.
Earthgrains focused on continued service to markets and protection of
customer relationships during the strike, resulting in significant one-time
costs but positioning the company to resume business improvement plans.
Continued operation of all but two of the 27 impacted bakeries during the
work stoppage is helping the company more quickly return to pre-strike service
and production levels.
Earthgrains will proceed with its business improvement plans for the
second half of fiscal year 2001 and for fiscal year 2002, including acquisition
integration in the United States and Europe, use of information technology,
control and reduction of costs, and improvement of product mix through
additional premium and superpremium products.
Earthgrains is scheduled to report second-quarter results before the
stock market opens on Tuesday, October 3, 2000. The company plans to provide
further information regarding the strike impact at that time.
Earthgrains operates fresh-bakery and refrigerated-dough businesses in
the United States and Europe. The company is the second-largest packaged
bread and baked goods producer in the United States with 64 bakeries in the
South, Southeast, Midwest, Upper Midwest, Southwest and West.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereby duly authorized.
THE EARTHGRAINS COMPANY
(Registrant)
By: /S/ MARK H. KRIEGER
Mark H. Krieger
Vice President and
Chief Financial Officer
Date: September 26, 2000
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