Hillshire Brands thinks outside the corn dog with CEO Connolly

Fri Sep 27, 2013 7:31pm EDT
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By Atossa Araxia Abrahamian

NEW YORK (Reuters) - Since Hillshire Brands HSH.N spun off from the Sara Lee Corp. last June, CEO Sean Connolly has made a point of thinking outside the box - and even beyond the traditional pig and cow.

Connolly, 47, joined Hillshire last year after serving as the president of Campbell North America (CPB.N: Quote). He has focused for the last year on energizing the brand, best known for Jimmy Dean sausages. He is trying to reach a broader and younger consumer base and get creative with poultry and even no-meat options.

He has also tried to foster a more collaborative atmosphere at work, moving into a office with an open design and no special "executive row."

"I am incredibly pleased with the amount of progress we've made in first year, but I am clear-eyed about the fact that it's the first year," he said in an interview this week with Reuters.

The largest and most important part of the company's business is packaged meat. The $1 billion Jimmy Dean brand's sales grew in the high single digits in the 2013 fiscal year, the company said.

The overall company, however, has seen sales slip due to high commodity prices and stiff competition. In the fourth quarter, operating income fell 23 percent and sales fell 2 percent. Earnings were 26 cents per share, topping the analysts' average estimate by a penny, and net income fell to $41 million, or 33 cents per share, from $599 million, or $5.02 per share, a year earlier.

Out of ten analysts with a recommendation, only one has rated Hillshire as a "buy" according to Thomson Reuters, but none put a "sell" on the stock. Others have ratings of "hold", "outperform" or "overweight."

Connolly nevertheless remains optimistic that in the long-term, the company will be profitable, helped by healthier and more portable meat products but also chicken, turkey, and vegetarian items.   Continued...

Hillshire Brands CEO Sean Connolly at the post that trades his company's stock on the floor of the New York Stock Exchange, July 3, 2012. REUTERS/Brendan McDermid