Glutino owner Boulder admits outside interest in business

Glutino owner Boulder admits outside interest in business

Udi's and Smart Balance owner Boulder Brands has hired advisors to look at its strategic options after the US group received interest from companies eyeing an unspecified transaction with the business.

Boulder, which has seen sales come under pressure in recent quarters and last month announced the exit of its CEO, said today (6 August) it had had "inquiries from a number of qualified parties that expressed interest in discussing a potential transaction".

The announcement came alongside Boulder's second-quarter results - which included a US$3.3m loss and a fall in sales - and the company's admission it is looking at the future of its Level Life Foods unit, which is focused on consumers with diabetes. Boulder also cut its earnings forecast for 2015.

The company said its board had appointed William Blair & Co. to help it "explore a range of strategic and financial alternatives to enhance shareholder value".

Boulder said: "No decision has been made and that there can be no assurance that the Board's exploration of strategic or financial alternatives will result in any transaction being entered into or consummated."

It added there was not timetable to complete the process and insisted it would not comment further until either the board had decided what steps to take or has concluded the strategic review.

In the meantime, the Boulder board has put on hold its search for a permanent CEO to replace Steve Hughes. COO Jim Leighton was appointed Boulder's interim chief executive when Hughes's resignation was announced in June.

The departure of Hughes, who a decade ago founded the business that became Boulder, was announced alongside company estimates that second-quarter sales would fall 5-7%. Parts of Boulder's business has faced challenges, with the company making a loss of over US$127m in 2014 after impairment charges on its under-performing Smart Balance brand.

Today, Boulder announced its second-quarter results. Net sales tumbled 10.7% to $117.7m, lower than the $122-124m it forecast in June. Glutino sales were down almost 19%.

The company booked an impairment charge of $2.7m on Level. Boulder said it is "currently reviewing strategic options for this brand". The charge contributed to a net loss for the quarter to $3.3m and an operating loss of $6.9m. In the second quarter of 2014, Boulder generated net income of $2.8m and operating income of $8.6m.

The results meant Boulder lowered its forecast for earnings per share from $0.25-0.29 to $0.20-0.25.