<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
February 23, 1998 (February 18, 1998)
-----------------------------------------------------------
Date of Report (Date of earliest event reported)
Bestfoods
---------------------------------------------------------------
(Exact Name of Registrant as Specified in Charter)
Delaware 1-4199 36-2385545
- ------------------------------- ------------------------ ---------------------
(State or Other Jurisdiction of (Commission File Number) (IRS Employer
Incorporation) Identification Number)
700 Sylvan Avenue
International Plaza
Englewood Cliffs, New Jersey 07632-9976
- --------------------------------------------------------------------------------
(Address of Principal Executive Offices) (Zip Code)
(201) 894-4000
---------------------------------------------------------------
Registrant's telephone number, including area code
<PAGE> 2
Item 5. Other Events.
Reference is made to the press release issued by Registrant on February
18, 1998 filed herewith as Exhibit 1 describing a presentation by Registrant to
financial analysts on the same date. Exhibit 1 is incorporated by such
reference.
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits.
(c) Exhibits.
Exhibit 1 Registrant's Press Release issued on February 18, 1998, as amended.
<PAGE> 3
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 hereunto duly authorized.
Date: February 23, 1998 BESTFOODS
By: /s/ HANES A. HELLER
-------------------
Vice President, General Counsel and Secretary
<PAGE> 1
EXHIBIT 1
Media Contact: Gale L. Griffin (201) 894-2407
Vice President, Corporate Communications
Analyst Contact: Bernard H. Kastory (201) 894-2837
Senior Vice President, Finance and Administration
BESTFOODS PROJECTS HIGHER GROWTH RATES FOLLOWING 1997 CORN REFINING
SPIN-OFF; COMPANY TO REPURCHASE 860,000 SHARES BY MID-YEAR
ENGLEWOOD CLIFFS, NJ, February 18, 1998 -- Bestfoods fully expects to accelerate
its 10.6% operating income growth rate, as a result of the recently completed
spin-off of corn refining operations, C. R. Shoemate, chairman and chief
executive officer of Bestfoods, told the Consumer Analysts Group of New York at
their meeting in Naples, Florida, today.
Bestfoods comprises the consumer foods businesses of the former CPC
International, which spun off its corn refining operations at the end of 1997.
The 10.6% annual growth rate over a ten-year period was calculated, excluding
special items, on a pro forma basis.
Now, as a totally focused 100% consumer foods company, free of the
volatility of the corn refining business, Bestfoods expects to exceed its 10.6%
growth record, as the company implements its strategies in one industry instead
of two, he said.
The company expects that this improved earnings growth rate will
translate into excellent total return to shareholders, Mr. Shoemate said. He
pointed out that even as a two-industry company, CPC International had a strong
track record compared to its 15-company food industry peer group. Over the last
ten years, CPC achieved a total return to shareholders of 586% compared to the
491% average return of the food industry peer group and the 426% average return
of the Standard & Poor's index. "We believe that Bestfoods, as a 100% consumer
foods company, can continuously rank in the top quartile of the industry peer
group in terms of total return," he said.
Mr. Shoemate also announced that, having completed all spin-off
activities, the company is today resuming repurchase of its shares. 860,000
shares remain of a five-million-share, three-year repurchase program. Shoemate
said he expects that the full 860,000 shares will be repurchased by mid-year,
1998.
Mr. Shoemate's presentation also included discussion of the global
progress of the company's three worldwide core businesses -- savory products,
chiefly under the Knorr brand; dressings, chiefly under Hellmann's; and
foodservice -- and its baking business in the United States.
The Knorr brand, he said, "is quite simply one of the greatest food
brands in the world," Mr. Shoemate said. More than 80% of the company's $3
billion in sales from Knorr products come from number one or number two market
positions in Bestfoods' 61 countries of operations. In Europe overall, Knorr is
one of the top ten consumer foods brands.
<PAGE> 2
Bestfoods is the number one mayonnaise company in the world, Shoemate
said. Its flagship brand, Hellmann's, has a 50% market share in the U.S. and
equivalent strength in several European markets. In most of its other markets
around the world Bestfoods' mayonnaises are a strong number one or number two.
To illustrate the local power of this originally U.S. brand, Mr. Shoemate
pointed out that in Argentina Hellmann's is one of the top ten of all brands in
all industries in terms of consumer perception of quality.
Mr. Shoemate announced that the company expects to begin producing
mayonnaise in Russia during 1998. Late in 1997, the company signed an agreement
to lease a building in Tula, south of Moscow. It will be converted to a
mayonnaise-producing facility. The locally-produced mayonnaise will replace the
Hellmann's mayonnaise the company has been importing into Russia from its
Central European affiliates since 1993.
Mr. Shoemate also discussed the company's foodservice business. He
pointed out that the trend toward out-of-home eating simply opens another avenue
for growth for Bestfoods, which has a strong global foodservice business. "We
are not selling plastic forks and paper napkins. We are selling our premium
branded products in large-size packs, as well as specially-formulated products
for restaurant chain operators."
Commenting on Bestfoods' baking business, Mr. Shoemate said that the
company is pleased with the progress of the business, which was dramatically
expanded in 1995 with the acquisition of the Entenmann's, Oroweat, Freihofer's,
and Boboli brands. Operating income from baking increased 25% in the
fourth-quarter of 1997 and 9% for the year, as the company continued to achieve
synergies between the acquired and existing operations.
To provide the clearest possible description of our business and outlook, this
report contains forward-looking statements based on our best current information
and reasonable assumptions about anticipated developments. However, because of
the risks and uncertainties that always exist in any operating environment or
business, we cannot make any assurances that these expectations will prove
correct. Actual results and developments may differ materially, depending upon
currency values, competitive pricing, economic conditions in our countries of
operations, and other factors. Further information on factors that could affect
the company's financial and other results is included in the company's Forms
10-Q and 10-K, filed with the Securities and Exchange Commission.
ABOUT BESTFOODS: Bestfoods, formerly CPC International Inc., is among the
largest U.S. food companies, with sales of $8.4 billion in 1997. Best known
among Bestfoods' U.S. products are: Hellmann's and Best Foods mayonnaise and
dressings; Mazola corn oil and margarine; Skippy peanut butter; Knorr soups,
sauces, and bouillons; Entenmann's sweet baked products; Thomas' English
muffins; Arnold, Brownberry, Freihofer's, and Oroweat breads; Boboli pizza
crusts; Mueller's pasta; and Karo syrup. Bestfoods' global Knorr brand comprises
one of the world's most extensive lines of products. Bestfoods is one of the
nation's most international food companies, with operations in more than 60
countries and products marketed in 110 countries. For more information about
Bestfoods, visit the company's Web site on the Internet at:
http://www.bestfoods.com.
