November 11, 2009 / 12:27 PM / 9 years ago

UPDATE 2-Flowers Foods Q3 sales miss estimtes, cuts FY view

* Q3 EPS $0.34 in line with est

* Q3 sales up 4.6 pct at $602.6 mln, miss est

* Trims 2009 outlook

* Shares down as much as 8 pct (Recasts, adds details; updates share movement)

Nov 11 (Reuters) - Bakery company Flowers Foods Inc (FLO.N) posted quarterly sales below market estimates and cut its full-year outlook, weighed down by competition and higher promotional activity, sending its shares down as much as 8 percent.

It now expects fiscal 2009 sales of $2.60 billion to $2.61 billion, down from its prior estimate of $2.65 billion to $2.68 billion.

The company, which produces, markets, and distributes breads, buns, rolls, and bakery goods to retail and foodservice customers, also reduced the upper end of its full-year profit view by 8 cents a share. It now sees earnings of $1.37 to $1.40 a share, excluding items.

In the third quarter, overall sales volumes fell 1 percent mostly due to lower demand in its non-retail channel. The company’s foodservice, vending and institutional categories have been hit in the gloomy economic environment as consumers eat out less.

Also, heavy promotional activity in the retail channel hurt the company’s branded white bread volumes, it said in a statement.

Flowers Foods introduced promotional pricing earlier this year to protect its market share as it faced intense competition, especially in Florida, California and Arizona — states hit hard by the housing downturn.

The Thomasville, Georgia-based company posted a higher third-quarter profit of 34 cents a share, in line with market expectations.

Sales rose 4.6 percent to $602.6 million. Analysts on average were looking for $616.5 million, according to Thomson Reuters I/B/E/S.

The company also forecast fiscal 2010 sales growth of 2.5 percent to 4.5 percent, excluding future acquisitions, and earnings per share to increase 10 percent to 15 percent.

Shares of the company were down $1.85 at $22.01 in morning trade on Wednesday on the New York Stock Exchange. They hit a low of $21.91 earlier. (Reporting by Mihir Dalal in Bangalore; Editing by Pradeep Kurup)

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