Sara Lee Corp. presented new growth initiatives during the annual Consumer Analyst Group of New York (CAGNY) conference, with company Chairman and CEO Brenda Barnes highlighting the plans.
Discussing the company’s progress on its multi-year transformation, Barnes detailed Sara Lee’s expanding global customer portfolio and product innovation and marketing efforts.
She also addressed Sara Lee’s near-term actions to address current business challenges, as well as cost-savings and other efficiencies it anticipates from its “Project Accelerate” initiative.
“Sara Lee’s value proposition and prospects for profitable growth are better than at any other time since I’ve been here,” Barnes said. “And, I’m excited about the tremendous additional opportunities for improvement that will allow us to build on our success and yield strong results going forward.”
Transformation milestones at Sara Lee discussed by Barnes include streamlining the organization, creating a centralized infrastructure, consolidating the North American and corporate headquarters, and the divestiture or spin-offs that resulted in nearly $3.8 billion of proceeds.
Barnes noted that costs associated with transformation were on budget, and that the program had delivered significant incremental EBIT since it was announced in February 2005.
Barnes also focused specifically on actions the company is taking to improve performance in its European businesses, which have been challenged recently by a weakening economy and the impact of a strengthening US dollar.
These include expanding product distribution at hard discounters and convenience stores, continued launch of new product innovations and “affordable essentials” supported by heavy in-store promotions, SKU rationalization and other supply chain efficiency programs, aggressive cost reduction and pricing actions where appropriate
“We believe our recent operating trends, especially in North America, demonstrate the power of the transformation,” Barnes said. “We’ve proven we can deliver cost savings and we will continue to do so through Project Accelerate, which is expected to yield $200 million to $250 million in annualized cost savings by fiscal 2011. We’re confident about our long-range performance targets, and we believe that between operational improvements and marketplace success, we will deliver.”