Boulder Brands—or parts of it—could be on the market.
The company announced Aug. 6 that it has retained asset management firm William Blair & Company to advise the board in the exploration of “strategic and financial alternatives.” Interim CEO Jim Leighton fell short of saying the company or any of its brands are on the block, though he reported that “qualified parties (have) expressed interest in discussing a potential transaction with Boulder Brands.”
The announcement comes as the Nasdaq-traded organization (BDBD) reported a 10.4 percent decline in net sales ($117.7 million) and experienced an operating loss of $6.9 million in the second quarter.
In June, co-founder and CEO Steve Hughes resigned. In July, the Boulder Brands reduced headcount by 15 percent.
Wednesday, Leighton said the CEO search will be suspended during its review with William Blair & Company.
Meanwhile, he said Boulder Brands’ leadership knows the issues and plans to address them in these four steps.
- Launching more balanced and effective marketing. The company plans to focus on higher sales velocity as it makes distribution gains. It also will focus on key categories in each brand and strive to elevate consumer awareness of emerging brands Udi’s, Evol and Earth Balance. Boulder Brands has new consumer and customer partners to launch a plan more broadly in 2016.
- Increasing product renovation and continuing innovation. With a focus on pricing and merchandising, Boulder Brands hopes to increase sales velocity, particularly in the increasingly competitive gluten-free category, an area in which Boulder Brands embarked on “customer work” to understand the category's future. Additionally, Evol will grow into other frozen spaces.
- Realizing efficiencies in brands, prods and channels. Reviews of brands such as Level Life Foods “that are not strategic to the future” and focusing on strategic channels, as well as shutting down or pulling back on nonstrategic ones such as export, will accompany a look at brand mix.
- Improving overall cost structure. In addition to the reduced head count effort, Boulder Brands will outsource to co-packers where savings can be gained, increase plant efficiencies and improve upon the supply chain. Additional, though unidentified, cost savings were noted, too.
Additional second-quarter highlights include:
- Net sales for the natural segment decreased 1.9 percent to $78.6 million, compared with $80.1 million in 2014.
- Udi’s sales grew 4.6 percent, and Glutino declined 18.9 percent.
- Net sales for the Balance segment decreased 23.7 percent.
- Gross profit decreased 14 percent to $40.4 million or 33.8 percent of net sales.