The stock market reacted negatively this week to Interstate Bakeries’ announcement that it will lose money in the quarter in progress, and its downward revision of its profits forecast.
Stock tumbled 25% in the first 24 hours after the announcement. Interstate Bakeries also revealed it would shut down 100 thrift stores. The company cited higher energy bills and health care expenses, sluggish sales and an unusually high rate of return of unsold product as reasons for the downbeat statement, reported the Kansas City Star.
Should Interstate Bakeries lose money this quarter, this would be its first quarterly loss without a one-off charge since the 1980s. Interstate’s chief financial officer, Frank Coffey, said Tuesday that sales had not rebounded from an earlier slump the company first noted in September.
He said the slump in snack cake sales is the most troublesome, particularly in convenience stores.
