Aren't Twinkies Low Carb?

Twinkies Maker Seeking Ch. 11 Protection

By DAVID TWIDDY
..c The Associated Press

KANSAS CITY, Mo. (AP) - Interstate Bakeries Corp., the purveyor of lunch box
staples Wonder Bread and Twinkies, filed for bankruptcy protection
Wednesday, felled by the combination of a more health-conscious public and
smothering operational costs.

The nation's largest wholesale baker, which had shown signs of financial
weakness for months, filed for Chapter 11 reorganization and installed new
management, saying it intended to survive. The company said it would
continue operating its bakeries, outlet stores and distribution centers.

Tony Alvarez, the head of turnaround firm Alvarez & Marsal and the baker's
new chief executive, said the company had no immediate plans to lay off
additional personnel. But, he added, ``It's very rare in this country that
anyone goes through Chapter 11 and is layoff-free.''

For more than a year, Interstate Bakeries has struggled with declining sales
of its bread and sweet goods products, a drop the company and analysts blame
on the popularity of high-protein, low-carb diets such as Atkins and South
Beach.

Thomas Morabito, a food analyst at Longbow Research in Cleveland, said the
company was hurt by what he called a ``lack of innovation'' in responding to
the low-carb market; it didn't release a low-carb product until February.

He said the diet trend, combined with the company's high debt and large
overhead costs, led to Wednesday's filing.

``I think the low-carb phenomenon was just a final blow to IBC,'' Morabito
said.

The Kansas City-based company listed assets of $1.6 billion and liabilities
of $1.3 billion in its court filings. In those filings, it said chairman and
CEO James Elsesser had resigned, effective Wednesday. Joining Alvarez from
his firm is John Suckow, who was named Interstate Bakeries' chief
restructuring officer.

The company also said J.P. Morgan Chase & Co. had agreed to provide the
bakery with $200 million to pay employees, vendors and other expenses during
the reorganization, provided officials got approval from a bankruptcy judge.
A hearing was scheduled for Thursday in U.S. Bankruptcy Court in Kansas
City.

Interstate Bakeries and its subsidiaries employ 32,000 people at 54 bakeries
and 2,200 distribution centers and outlet stores across the country. In the
past two years, the company has laid off about 800 employees as it closed
several bakeries.

While Alvarez said he remained optimistic when speaking with employees
Wednesday, he acknowledged in an interview that it could be weeks before he
and his management team have a chance to study the company's operation and
determine its future.

``After two days, I have more questions than answers,'' he said. ``We're in
an industry that is challenged because of consumer tastes. We have to come
up with strategies to offset the revenue issues and strategies to reduce our
cost base. It's way premature to tell what that may be.''

Gary Hindes, who manages Deltec Asset Management in New York, a firm that
works with distressed companies, predicted the solution would be far from
complex, centered on responding to a market that is less tolerant of sugar
and carbohydrates.

``Fixing this company is not rocket science,'' Hindes said. ``Their costs
are too high. What they're going to do is sell off bakeries, renegotiate
union contracts. I think it will come out a lot leaner and profitable
operation.''

The first sign the company was in serious financial trouble came when it
missed an Aug. 30 deadline to file an annual report for the fiscal year that
ended May 29.

That report was initially delayed because of an ongoing internal
investigation into $40 million the company placed into its reserve for
workers' compensation claims. Following the review, the company said it
would have to restate earnings for parts of 2003. Meanwhile, the Securities
and Exchange Commission said it had started its own investigation into the
workers' compensation issue.

Interstate Bakeries hasn't issued a report on its finances since April. Last
month, it said it was having trouble putting out figures for the most recent
quarter because of trouble with its new computer system.

At the same time, the company said it might not be in compliance with its
loan agreements and that its external auditors might have to add language to
the annual report expressing doubts of whether Interstate Bakeries could
continue as ``a going concern.''

While the future of the company was unclear Wednesday, analysts said its
famous brands - Hostess, Wonder, Baker's Inn and Home Pride - are unlikely
to disappear from store shelves.

``Someone is going to want to get their hands on the Twinkie brand,''
Morabito said.

On the Net:

Interstate Bakeries: http://www.corporate-ir.net/ireye/ir...tml?ticker=IBC

"jk" wrote in message
t...
Twinkies Maker Seeking Ch. 11 Protection

By DAVID TWIDDY
.c The Associated Press

KANSAS CITY, Mo. (AP) - Interstate Bakeries Corp., the purveyor of lunch
box
staples Wonder Bread and Twinkies, filed for bankruptcy protection
Wednesday, felled by the combination of a more health-conscious public and
smothering operational costs.

The nation's largest wholesale baker, which had shown signs of financial
weakness for months, filed for Chapter 11 reorganization and installed new
management, saying it intended to survive. The company said it would
continue operating its bakeries, outlet stores and distribution centers.

Tony Alvarez, the head of turnaround firm Alvarez & Marsal and the baker's
new chief executive, said the company had no immediate plans to lay off
additional personnel. But, he added, ``It's very rare in this country that
anyone goes through Chapter 11 and is layoff-free.''

For more than a year, Interstate Bakeries has struggled with declining
sales
of its bread and sweet goods products, a drop the company and analysts
blame
on the popularity of high-protein, low-carb diets such as Atkins and South
Beach.

Thomas Morabito, a food analyst at Longbow Research in Cleveland, said the
company was hurt by what he called a ``lack of innovation'' in responding
to
the low-carb market; it didn't release a low-carb product until February.

He said the diet trend, combined with the company's high debt and large
overhead costs, led to Wednesday's filing.

``I think the low-carb phenomenon was just a final blow to IBC,'' Morabito
said.

The Kansas City-based company listed assets of $1.6 billion and
liabilities
of $1.3 billion in its court filings. In those filings, it said chairman
and
CEO James Elsesser had resigned, effective Wednesday. Joining Alvarez from
his firm is John Suckow, who was named Interstate Bakeries' chief
restructuring officer.

The company also said J.P. Morgan Chase & Co. had agreed to provide the
bakery with $200 million to pay employees, vendors and other expenses
during
the reorganization, provided officials got approval from a bankruptcy
judge.
A hearing was scheduled for Thursday in U.S. Bankruptcy Court in Kansas
City.

Interstate Bakeries and its subsidiaries employ 32,000 people at 54
bakeries
and 2,200 distribution centers and outlet stores across the country. In
the
past two years, the company has laid off about 800 employees as it closed
several bakeries.

While Alvarez said he remained optimistic when speaking with employees
Wednesday, he acknowledged in an interview that it could be weeks before
he
and his management team have a chance to study the company's operation and
determine its future.

``After two days, I have more questions than answers,'' he said. ``We're
in
an industry that is challenged because of consumer tastes. We have to come
up with strategies to offset the revenue issues and strategies to reduce
our
cost base. It's way premature to tell what that may be.''

Gary Hindes, who manages Deltec Asset Management in New York, a firm that
works with distressed companies, predicted the solution would be far from
complex, centered on responding to a market that is less tolerant of sugar
and carbohydrates.

``Fixing this company is not rocket science,'' Hindes said. ``Their costs
are too high. What they're going to do is sell off bakeries, renegotiate
union contracts. I think it will come out a lot leaner and profitable
operation.''

The first sign the company was in serious financial trouble came when it
missed an Aug. 30 deadline to file an annual report for the fiscal year
that
ended May 29.

That report was initially delayed because of an ongoing internal
investigation into $40 million the company placed into its reserve for
workers' compensation claims. Following the review, the company said it
would have to restate earnings for parts of 2003. Meanwhile, the
Securities
and Exchange Commission said it had started its own investigation into the
workers' compensation issue.

Interstate Bakeries hasn't issued a report on its finances since April.
Last
month, it said it was having trouble putting out figures for the most
recent
quarter because of trouble with its new computer system.

At the same time, the company said it might not be in compliance with its
loan agreements and that its external auditors might have to add language
to
the annual report expressing doubts of whether Interstate Bakeries could
continue as ``a going concern.''

While the future of the company was unclear Wednesday, analysts said its
famous brands - Hostess, Wonder, Baker's Inn and Home Pride - are unlikely
to disappear from store shelves.

``Someone is going to want to get their hands on the Twinkie brand,''
Morabito said.

On the Net:

Interstate Bakeries: http://www.corporate-ir.net/ireye/ir...tml?ticker=IBC




You know, it's not like the whole world is going low-carb.

I have a lot of friends who eat a lot of carb foods. They are skinny, and
tell me they need the carbs for energy. It's just a different metabolism.

I think that it's wonderful that people, facing a crisis of obesity and
diabetes, are becoming more aware of the affect that different foods have on
their bodies. Those of us who don't have the high metabolism to burn off
all that crap are going to go low-carb for our weight and health. I think
it's just a matter of becoming knowledgeable about what we can eat that will
best affect our bodies, don't you? I don't think there's an agenda against
a twinkie company, or anything.

"jk" wrote in message
t...
Twinkies Maker Seeking Ch. 11 Protection

By DAVID TWIDDY
.c The Associated Press

KANSAS CITY, Mo. (AP) - Interstate Bakeries Corp., the purveyor of lunch
box
staples Wonder Bread and Twinkies, filed for bankruptcy protection
Wednesday, felled by the combination of a more health-conscious public and
smothering operational costs.

The nation's largest wholesale baker, which had shown signs of financial
weakness for months, filed for Chapter 11 reorganization and installed new
management, saying it intended to survive. The company said it would
continue operating its bakeries, outlet stores and distribution centers.

Tony Alvarez, the head of turnaround firm Alvarez & Marsal and the baker's
new chief executive, said the company had no immediate plans to lay off
additional personnel. But, he added, ``It's very rare in this country that
anyone goes through Chapter 11 and is layoff-free.''

For more than a year, Interstate Bakeries has struggled with declining
sales
of its bread and sweet goods products, a drop the company and analysts
blame
on the popularity of high-protein, low-carb diets such as Atkins and South
Beach.

Thomas Morabito, a food analyst at Longbow Research in Cleveland, said the
company was hurt by what he called a ``lack of innovation'' in responding
to
the low-carb market; it didn't release a low-carb product until February.

He said the diet trend, combined with the company's high debt and large
overhead costs, led to Wednesday's filing.

``I think the low-carb phenomenon was just a final blow to IBC,'' Morabito
said.

The Kansas City-based company listed assets of $1.6 billion and
liabilities
of $1.3 billion in its court filings. In those filings, it said chairman
and
CEO James Elsesser had resigned, effective Wednesday. Joining Alvarez from
his firm is John Suckow, who was named Interstate Bakeries' chief
restructuring officer.

The company also said J.P. Morgan Chase & Co. had agreed to provide the
bakery with $200 million to pay employees, vendors and other expenses
during
the reorganization, provided officials got approval from a bankruptcy
judge.
A hearing was scheduled for Thursday in U.S. Bankruptcy Court in Kansas
City.

Interstate Bakeries and its subsidiaries employ 32,000 people at 54
bakeries
and 2,200 distribution centers and outlet stores across the country. In
the
past two years, the company has laid off about 800 employees as it closed
several bakeries.

While Alvarez said he remained optimistic when speaking with employees
Wednesday, he acknowledged in an interview that it could be weeks before
he
and his management team have a chance to study the company's operation and
determine its future.

``After two days, I have more questions than answers,'' he said. ``We're
in
an industry that is challenged because of consumer tastes. We have to come
up with strategies to offset the revenue issues and strategies to reduce
our
cost base. It's way premature to tell what that may be.''

Gary Hindes, who manages Deltec Asset Management in New York, a firm that
works with distressed companies, predicted the solution would be far from
complex, centered on responding to a market that is less tolerant of sugar
and carbohydrates.

``Fixing this company is not rocket science,'' Hindes said. ``Their costs
are too high. What they're going to do is sell off bakeries, renegotiate
union contracts. I think it will come out a lot leaner and profitable
operation.''

The first sign the company was in serious financial trouble came when it
missed an Aug. 30 deadline to file an annual report for the fiscal year
that
ended May 29.

That report was initially delayed because of an ongoing internal
investigation into $40 million the company placed into its reserve for
workers' compensation claims. Following the review, the company said it
would have to restate earnings for parts of 2003. Meanwhile, the
Securities
and Exchange Commission said it had started its own investigation into the
workers' compensation issue.

Interstate Bakeries hasn't issued a report on its finances since April.
Last
month, it said it was having trouble putting out figures for the most
recent
quarter because of trouble with its new computer system.

At the same time, the company said it might not be in compliance with its
loan agreements and that its external auditors might have to add language
to
the annual report expressing doubts of whether Interstate Bakeries could
continue as ``a going concern.''

While the future of the company was unclear Wednesday, analysts said its
famous brands - Hostess, Wonder, Baker's Inn and Home Pride - are unlikely
to disappear from store shelves.

``Someone is going to want to get their hands on the Twinkie brand,''
Morabito said.

On the Net:

Interstate Bakeries: http://www.corporate-ir.net/ireye/ir...tml?ticker=IBC




You know, it's not like the whole world is going low-carb.

I have a lot of friends who eat a lot of carb foods. They are skinny, and
tell me they need the carbs for energy. It's just a different metabolism.

I think that it's wonderful that people, facing a crisis of obesity and
diabetes, are becoming more aware of the affect that different foods have on
their bodies. Those of us who don't have the high metabolism to burn off
all that crap are going to go low-carb for our weight and health. I think
it's just a matter of becoming knowledgeable about what we can eat that will
best affect our bodies, don't you? I don't think there's an agenda against
a twinkie company, or anything.

"Jim Bard" wrote in message
...
You know, it's not like the whole world is going low-carb.

I have a lot of friends who eat a lot of carb foods. They are skinny, and
tell me they need the carbs for energy. It's just a different metabolism.

I think that it's wonderful that people, facing a crisis of obesity and
diabetes, are becoming more aware of the affect that different foods have
on
their bodies. Those of us who don't have the high metabolism to burn off
all that crap are going to go low-carb for our weight and health. I think
it's just a matter of becoming knowledgeable about what we can eat that
will
best affect our bodies, don't you? I don't think there's an agenda
against
a twinkie company, or anything.



I remember when the cool look was greasy hair tonics. Then the wethead
was dead with Vitalis. Then shoulder length hair with styling mousse was the
thing. Those companies either adapted or went out of business when styles
changed.
Not everyone is a LC eater, but enough have changed the way they eat, that
it's made a big impact on the companies that haven't adapted. Unless they
can make a LC twinkie.... sadly not enough of your skinny carb eating
friends will keep them around.

--
JK Sinrod
Sinrod Stained Glass Studios
http://www.sinrodstudios.com/
Coney Island Memories
www.sinrodstudios.com/coneymemories/