Flowers Foods’ fourth-quarter profit up almost 50%

Residents around downtown Thomasville are used to the sweet scent of warm, fresh-baked breads and snacks wafting through the air from Flowers Foods’ bakeries.

Wall Street, which has had a wrinkled nose of late stemming from less-than-stellar quarterly earnings reports, is relishing in Flowers Foods, too.

On Thursday, the 90-year-old South Georgia company said profits soared nearly 50 percent in the fourth quarter and 26 percent for the year.

What’s more, Flowers said it expects to boost 2009 earnings per share between 7 percent and 15.6 percent.

Flowers Foods’ shares rose more than 10 percent on the results and rosy outlook to $23.71 per share. The stock is still down 0.23 percent in the last 12 months as the economy chips away even at more recession-resistant companies.

Flowers, whose product lineup includes Nature’s Own and Cobblestone Mill premium breads and rolls and and Mrs. Freshley’s snack cakes, said it earned $32.1 million, or 34 cents per share, in the quarter, compared with $21.4 million, or 23 cents per share, in the 2007 fourth quarter.

For the year, the company reported profit of $119.2 million, or $1.28 per share, vs. $94.6 million, or $1.02 per share, in 2007.

Wall Street expected net income per share of 34 cents for the quarter and $1.24 per share for the year.

The full-year profit includes a $2.3 million pre-tax gain on the sale of a manufacturing facility and a $3.1 million asset impairment charge related to the closings of three facilities taken in the fourth quarter.

“As all know it’s the time of uncertainty for many companies. Flowers Foods continues to deliver consistent and substantial performance,” George E. Deese, Flowers’ chairman and chief executive, said Thursday during a conference call with analysts.

The company said competitive pricing, especially for its Nature’s Own and Whitewheat breads, helped results.

“We’ve achieved good results for 2008 through continued focus on operating strategies and the determination of our team,” Deese said. “We have invested in our bakeries, our products and brands, our distribution and information systems, and in developing our team.”

Flowers’ results were not entirely unexpected. Economists have said those industries making basic products consumers will keep buying despite cyclical economic downturns do better during recessions.

What’s more basic than bread?

Flowers itself — Forbes magazine last month named it the best-managed, publicly traded food company in America and one of the best 400 big American firms overall — has been cutting corporate fat for the last three years. While trimming expenses at headquarters, the company, which went public in 1968, has made about 100 strategic acquisitions nationwide. Its strategy of focusing on high-growth metro markets, particularly in the southern half of the country, allows its fresh-baked goods to reach 48 percent of Americans in 25 states and Washington, D.C.