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Boulder Brands reports exceptional quarter for EVOL Foods: 'Retailers recognize that the frozen case is in dire need of a complete renovation'

By Elaine WATSON , 09-May-2014
Last updated on 09-May-2014 at 03:07 GMT2014-05-09T03:07:43Z

Boulder Brands: Exceptional growth for EVOL Foods & Udi's gluten-free

Retailers recognize that the frozen case is in “dire need of a complete renovation”, says the boss of Boulder Brands.

Best known for its Udi's and Glutino gluten-free products, plus the Earth Balance and Smart Balance brands, Boulder Brands acquired funky frozen food firm EVOL Foods in December, and says it is now delivering explosive growth with the firepower of a larger company behind it.

Speaking on Boulder Brands’ first quarter earnings call this week, CEO Steve Hughes said Millennials are “simply not engaging with the frozen category”, and that "retailers have realized that these legacy brands… their best days are behind them…

He added: "Retailers believe new, on-trend brands delivering high-quality products with pure and simple ingredients can be the solution, and they are aggressively looking for alternative brands that have potential to bring consumers back to the frozen food category. We offer that with two brands, EVOL, and Udi's gluten-free.”

EVOL Foods founder and CEO Phil Anson still runs the business within the Boulder Brands empire, and has helped deliver a "seamless integration", said Boulder Brands CEO Steve Hughes

There's almost a desperation relative to these frozen food buyers

Unlike Amy’s, some EVOL products contain meat, and serve as a “great compliment to those natural frozen brands that are captive to the vegetarian consumer”, he said.

“There's almost a desperation relative to these frozen food buyers that they've got Amy's as a great brand, and that's established. But they don't have a protein complement to that in the Natural space. EVOL and Udi's pretty clearly are that alternative… the reaction has been universally positive.”

EVOL generated net sales of $17m in 2013, but will do considerably better in 2014, said Hughes: “We expect EVOL to accelerate distribution materially in 2014… EVOL, had an exceptionally strong quarter.”

Soaring egg white prices to dent FY profits

In the quarter ended March 31, Boulder Brands' net sales rose 15.2% to $122.9m, driven by a strong performance from the Udi's gluten free brand, which grew 37% year-on-year. 

Full-year 2014 sales are predicted to be in the $540-550m range; but profits would likely be slightly lower than previously forecast owing to an unprecedented rise in egg white prices, said Hughes.  

"We're experiencing higher egg white prices, a key ingredient in Udi's bakery items. Egg white prices averaged $5 per pound last year, around $8 a pound in the first quarter and are currently running around $14 a pound."

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