SOURCE: Monterey Gourmet Foods

December 04, 2006 18:49 ET

Monterey Gourmet Foods Announces Completion of Restructuring

SALINAS, CA -- (MARKET WIRE) -- December 4, 2006 -- Monterey Gourmet Foods, Inc. (NASDAQ: PSTA) today announced the completion of its plant consolidation project and the realignment of the Company's operations. First announced in March 2006, the initial stage focused on consolidating production of two manufacturing facilities in Salinas and transferring packaged sauce production to the Company's CIBO Naturals plant in Seattle. Moving sauce production to Washington State incorporates several benefits, including: having one plant solely focused on producing sauces within the Company, lower payroll expenses and associated labor costs, and a lower tax base. Consolidating the two Salinas facilities eliminates unused space, redundant sanitation, maintenance and supervision.

Eric Eddings, Chief Executive Officer of Monterey Gourmet Foods, explains, "Consolidating our Salinas plants and focusing on specific products allows us to reduce costs and increase efficiencies. We have aligned our production capabilities with our core competencies which will maximize our strengths and solidify our commitment to quality."

Mr. Eddings continued, "Another component of our realignment has been a concurrent program designed to employ the superb talent pool available throughout our different companies that will benefit the organization as a whole. With the formation of a management executive committee to implement and execute key strategic projects and a complete overhaul of our personnel reporting methodologies, we have integrated our resources and emerged as one company with one sales force and one marketing department managing multiple brands in the gourmet refrigerated and frozen food category."

Mr. Eddings further stated, "A major component of our realignment is to maximize talents of individuals by expanding their responsibilities across all of our brands. Consistent with this new direction we are pleased to announce the promotion of Karina Graham to Director of Product Development, Bob Donaldson to VP of Retail Sales and Joe Stirlacci to VP of Club Channel Sales. All three of these key players have demonstrated success in the growth of their respective business units and will now have responsibility across all Monterey Gourmet Foods Brands and Categories. In addition, to further drive innovation we have hired two renowned culinary consultants to support our internal product development. We expect these combined resources to help the Company fuel growth well into the future."

"2006 has been a year of great change for Monterey Gourmet Foods. Now with the completion of our plant consolidation and our reporting realignment, we look forward to 2007 as a more streamlined company in terms of our manufacturing capability and reporting structure. Together, these elements position us to be much more effective within our competitive markets," concluded Mr. Eddings.

This press release contains forward-looking statements concerning the effect of Monterey Gourmet Foods' corporate acquisitions and product innovations on projected sales for future periods by product including without limitation statements including such terms as "will maximize," "fuel growth well into the future," and "position us to be much more effective within our competitive markets." These forward-looking statements are based on currently available competitive, financial and economic data and management's views and assumptions regarding future events. Such forward-looking statements are inherently uncertain, and investors must recognize that actual results may differ from those expressed or implied in the forward-looking statements. Consequently, the Company wishes to caution readers not to place undue reliance on any forward-looking statements. Among the factors that could cause Monterey Gourmet Foods' actual results to differ from such forward-looking statements are the following: (i) the process associated with the integrations of Sonoma Foods and Casual Gourmet operations, processes, and products, (ii) a significant reduction of sales to two major customers currently comprising a majority of total revenues, (iii) the retention of newly acquired customers including achieving volume projections for these new customers, (iv) the Company's ability to achieve improved production efficiencies associated with the plant restructuring program, (v) the timely and cost-effective introduction of new products in the coming months, (vi) retention of key personnel and retention of key management, (vii) the risks inherent in food production, (viii) intense competition in the market in which the Company competes and (ix) Monterey Gourmet Foods' ability to source competitively priced raw materials to achieve historical operating margins. In addition, the Company's results may also be affected by general factors, such as economic conditions, political developments, interest and inflation rates, accounting standards, taxes, and laws and regulations in markets where the Company competes.

The Company has provided additional information regarding risks associated with the business in the Company's Annual Report on Form 10-K for fiscal 2005, its Proxy Statement filed April 21, 2006, Forms 10-Q filed for our quarters ended March 31, 2006, June 30, 2006, and September 30, 2006, and Forms 8-K filed on January 23, 2006, February 23, 2006, March 9, 2006, April 25, 2006, June 13, 2006, June 28, 2006, September 11, 2006, September 21, 2006, and October 2, 2006. The Company undertakes no obligation to update or revise publicly, any forward-looking statements whether as a result of new information, future events or otherwise.

Monterey Gourmet Foods manufactures USDA inspected, fresh gourmet refrigerated food products at its integrated 143,000 square foot corporate headquarters, distribution, and manufacturing facilities in Salinas, (Monterey County) California, Seattle, Washington, and Eugene, Oregon. Monterey Gourmet Foods has national distribution of its products in over 10,000 retail and club stores throughout the United States and selected regions of Canada, the Caribbean, Latin America, and Asia Pacific.

Contact Information

  • CONTACT:

    Eric Eddings
    CEO
    Email Contact

    Scott Wheeler
    CFO
    Email Contact

    Monterey Gourmet Foods, Inc.
    1528 Moffett Street
    Salinas, California 93905
    831/753-6262