Barington Capital Group LP, which owns a 5.29% stake in Lancaster Colony Corporation, has publicly urged the diversified group to focus on its food activities.

In a filing with the Securities and Exchange Commission (SEC) yesterday (18 June), the New York-based investment group urged Lancaster to sell off its automotive, glassware and candle businesses in order to improve profitability and shareholder returns.

Lancaster Colony said last year that it was looking at strategic alternatives, which could include the sale of its non-food businesses. But Barington CEO James Mitarotonda said in a letter to Lancaster Colony CEO John Gerlach on 15 June that “it appears that little progress has been made toward achieving these objectives to date”.

Lancaster Colony spokesman Earle Brown said Barington’s filing was nothing new and that the company has met with the firm several times in the past year. “It’s all ideas that have been put forth before,” he said, adding that the company had continued to explore non-food disposals.

Barrington also said in the letter that Lancaster Colony’s share price performance had “consistently lagged” other food producers and the market as a whole. In addition to divesting from the non-food businesses, he said the company needs to improve the profitability of the specialty foods segment and to improve the business’ capital structure.

In response to suggestions that it had dragged its feet in addressing declining profitability from non-food operations, Lancaster Colony said that it had made changes over the past year by closing an industrial glass plant in Lancaster, selling an automotive accessories business in Wapakoneta, and acquiring the Alabama-based frozen roll and biscuit maker Marshall Biscuit Company.

But Mitarotonda said that Barington was “extremely disappointed that this is all the company has to show for its efforts”.

Lancaster Colony’s specialty food businesses produce salad dressings, frozen rolls and other food products, and accounted for 60.5% of the company’s US$1.17bn turnover last year.