Hood unveiled: H.P. Hood Inc. readies plans for an ESOP, the final step in a multifaceted restructuring program - employee stock ownership plan

Dairy Foods, Oct, 1993 by Gail Rosenbaum Doeff

Expansion via acquisition is always a consideration. Hood, ever willing to explore its options, is currently discussing the possible acquisition of milk and ice cream businesses in New England and the Mid-Atlantic, though Keller declines to name them.

Hood's extended shelflife fluid business offers the most possibilities for growth, although Hood ice cream is also expanding gradually both westward and south, with market share growing in Upstate New York and Pittsburgh in particular. Hood remains committed to the New England/New York market, however, and has no plans to attempt national distribution for its fresh products.

New opportunities and products

Licensing also presents Hood with expansion opportunities. In fact, it already plays a significant role. The company has a close relationship with Nestle Beverage Co., under which Hood converts powdered products like Carnation Hot Cocoa and Carnation Instant Breakfast into ESL quarts and half-gallons. Hood is currently completing negotiations for an exclusive deal in the Northeast to manufacture, sell and market these products. In an unusual move, Nestle has granted Hood an exclusive, multi-year license to produce and distribute Nestle Quik lowfat chocolate milk in aseptic 8-ounce drink boxes sold in 32 states east of the Rockies. The product will launch in February or March 1994 in the Northeast, and roll out gradually. Hood is also the largest licensee for MacNeil Consumer Products Co.'s Lactaid brand reduced-lactose milk, as well as the master licensee for LifeSaver on the ice cream side. On the new products front, a 12-flavor line of Hood Select premium ice cream in half-gallon rounds will debut this fall, along with a Hood Select pure premium juice line and Hood Select sour cream dips.

While Hood's evolution is not yet complete, the company's revitalization is already evident. Keller and Keaveny are on the road yet again, keeping Hood employees apprised of the company's latest progress and plans. And the pragmatism of the executive duo is clearly driving the company's recovery. Hood is now a viable contender, a highly realistic operation, and a strong example for struggling dairies. Not bad for an old-timer.

H.P. HOOD INC.

Headquarters: Boston

Founded: 1846 by Harvey P. Hood

Plant Locations:

Newington, Conn.--ice cream mix

Suffield, Conn.--ice cream

Portland, Maine--fluid milk, juices

Agawam, Mass.--fluid milk

Boston--fluid milk, juices, cultured products, ESL products

Oneida, N.Y.--ESL dairy and nondairy fluid products, mixes

Vernon, N.Y.--cultured products

Burlington, Vt.--fluid milk

Executives: Bob Keller, president and chief executive officer

Denis Keaveny, senior vice president and chief operating officer

Bob Schaejbe, senior vice president and chief financial officer

Employees: 1,750

Net worth: $45 million

Annual Gross Sales: FY 1993: $600,539,000(*)

FY 1994 (projected) $550,561,000

* Annual Net Sales: FY 1993: $560,502,000(*)

FY 1994 (projected): $500,504,000

Core Service Area: New England and New York

Product Line: fluid milk, cultured products, frozen desserts, juices ESL dairy and nondairy products and mixes.