Portland, OR - Gardenburger Inc. responded to a competitor's statement that may have confused investors and analysts. Gardenburger veggie patties are already the top-selling veggie patties in the United States and the brand is making rapid gains. It clearly leads sales in the food service, club store and natural food channels, based on a variety of data sources. Gardenburger veggie patties are also in a virtual tie for leadership in the grocery channel after only one year of national availability.
The most recent veggie patty sales data from A.C. Nielsen, reflecting 1998 grocery sales through May 2, shows Gardenburger veggie patties with a 33% market share -- up 17 share points in one year -- compared to a 36% share for Worthington Foods [Nasdaq:WFDS - news].
For the same period, sales of Gardenburger veggie patties in grocery stores were up 183% compared to the prior year, while the veggie patty category grew 37% and Worthington Foods veggie patties were up 7%.
In 1998, Gardenburger Inc. launched five new products into the grocery channel and began a $14 million advertising campaign to help take itself and the veggie patty category to mainstream consumers. Helping to fund this effort was $15 million raised in convertible subordinated notes from Dresdner, Kleinwort, Benson Private Equity Partners LP, one of the largest financial institutions in both the United States and Europe. The investment positioned Gardenburger with a very strong balance sheet at the end of first quarter 1998 with $9 million in cash and $17 million in working capital.
While the company has made a strategic decision to focus its efforts primarily on the veggie patty category rather than meat substitutes generally, the company also sells GardenSausage(TM), a meatless breakfast product available at 1600 Holiday Inns worldwide. It also holds proprietary technology for the production of other meat substitutes and is conducting business development activity for their expanded commercialization.
Founded in 1985 by GardenChef Paul Wenner(TM), Gardenburger, Inc. is an innovator in meatless, low- fat food products. The Company distributes its flagship Gardenburger(R) and other GardenProducts(TM) to more than 30,000 food service outlets throughout the United States, Canada and abroad. Retail customers include more than 20,000 grocery and specialty food stores and more than 4,000 natural food stores. Based in Portland, Oregon, the Company currently employs more than 175 people.
Statements in this press release about future events or performance are forward-looking statements that are necessarily subject to risk and uncertainty. The Company's actual results could be quite different. Important factors that could affect results include the Company's reliance on product acceptance, the Company's ability to execute its retail distribution plans, the effectiveness of the Company's sales and marketing efforts and intense competition in the meatless food products industry, which the Company believes will increase. Other important factors that could affect results are set forth in the Company's Annual Report on Form 10-K for the year ended December 31, 1997 and the Company's 1997 annual report to shareholders. Although forward-looking statements help provide complete information about the Company, investors should keep in mind that forward-looking statements are inherently less reliable than historical information.
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