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The Hillshire Brands Company Discusses Plans for Growth at CAGNY

Innovation, brand-building and cost management at center of company’s strategy

CHICAGO--(BUSINESS WIRE)--Feb. 20, 2013-- The Hillshire Brands Company (NYSE: HSH) presented today at the Consumer Analyst Group of New York’s (CAGNY) annual conference. Sean Connolly, president and chief executive officer and Maria Henry, chief financial officer shared the company’s four core strategies for growth:

  • Strengthen the core brands with increased investment behind improved advertising, upgrades to product quality and packaging, and category management
  • Extend trademarks into adjacent categories with new product innovations
  • Drive greater cost efficiencies in supply chain, trade spend, and through shift in corporate culture
  • Acquire on-trend businesses that align with strategic vision and create shareholder value

“It is an exciting time for Hillshire Brands. We remain focused on creating long-term shareholder value by strengthening our strong brands with leading innovation and marketing support,” said Connolly. “Equally, we continue to advance our cost efficiency programs as fuel for growth.”

“Overall, while it is still early days, we are quite encouraged by the progress we see in the business and within our company culture,” Connolly added.

The company’s core brands – Jimmy Dean, Ball Park, Hillshire Farm, Aidells, Gallo and Sara Lee – are leaders in their respective categories. To support these brands, the company plans to ramp up innovation, sharpen marketing positioning and increase MAP investment to five percent of revenues by fiscal 2015.

In addition, the company has plans to create a sustainable innovation pipeline, streamline time to market and reinvigorate consumer insights. The presentation highlighted numerous upgrades to product quality and packaging, new line extensions and adjacent innovations.

About The Hillshire Brands Company

The Hillshire Brands Company (NYSE: HSH) is a leader in meat-centric food solutions for the retail and foodservice markets. The company generates approximately $4 billion in annual sales and has approximately 9,500 employees. Hillshire Brands’ portfolio includes iconic brands such as Jimmy Dean, Ball Park, Hillshire Farm, State Fair, Sara Lee frozen bakery and Chef Pierre pies, as well as artisanal brands Aidells and Gallo Salame.

Forward-Looking Statements

This release contains forward-looking statements regarding Hillshire Brands’ business prospects and future financial results and metrics. Forward-looking statements are typically preceded by terms such as “will,” “plans,” “anticipates,” “intends,” “expects,” “likely” or “believes” and other similar terms. These forward-looking statements are based on currently available competitive, financial and economic data and management’s views and assumptions regarding future events and are inherently uncertain.

Investors must recognize that actual results may differ from those expressed or implied in the forward-looking statements, and the company wishes to caution readers not to place undue reliance on any forward-looking statements. Among the factors that could cause Hillshire Brands’ actual results to differ from such forward-looking statements are those described under Item 1A, Risk Factors, in Hillshire Brands’ most recent Annual Report on Form 10-K, as well as factors relating to:

  • Hillshire Brands’ spin-off of its international coffee and tea business in June 2012, including (i) Hillshire Brands’ ability to generate the anticipated benefits from the spin-off; (ii) the transition of leadership to a new senior management team and the departure of key personnel with historical knowledge; and (iii) potential tax liabilities and other indemnification obligations;
  • The consumer marketplace, such as (i) intense competition, including advertising, promotional and price competition; (ii) changes in consumer behavior due to economic conditions, such as a shift in consumer demand toward private label; (iii) fluctuations in raw material costs, Hillshire Brands’ ability to increase or maintain product prices in response to cost fluctuations and the impact on profitability; (iv) the impact of various food safety issues and regulations on sales and profitability of Hillshire Brands’ products; and (v) inherent risks in the marketplace associated with product innovations, including uncertainties about trade and consumer acceptance;
  • Hillshire Brands’ relationship with its customers, such as (i) a significant change in Hillshire Brands’ business with any of its major customers, such as Wal-Mart, its largest customer; and (ii) credit and other business risks associated with customers operating in a highly competitive retail environment; and
  • Other factors, such as (i) Hillshire Brands’ ability to generate margin improvement through cost reduction and productivity improvement initiatives; (ii) Hillshire Brands’ credit ratings, the impact of Hillshire Brands’ capital plans on such credit ratings and the impact these ratings and changes in these ratings may have on Hillshire Brands’ cost to borrow funds and access to capital/debt markets; and (iii) the settlement of a number of ongoing reviews of Hillshire Brands’ income tax filing positions and inherent uncertainties related to the interpretation of tax regulations in the jurisdictions in which Hillshire Brands transacts or has transacted business.

Source: The Hillshire Brands Company

The Hillshire Brands Company
Mike Cummins, +1.312.614.8529
Melissa Napier, +1.312.614.8739

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