The Change Mariner

Low-Carb Impact Affecting Krispy Kreme

Yahoo! News:

Could the Krispy Kreme doughnut be the latest victim of the low-carb diet craze?

The Winston-Salem-based doughnut maker said Friday that it is cutting its profit projection for this year by 10 percent because of lower demand for its high-calorie treats -- which the company attributes in part to the low-carb diet phenomenon.

The announcement drove its stock price down 23 percent in early trading.

"The popularity of low-carb diets has captured the consumer's attention," said Scott Livengood, chief executive and chairman of Krispy Kreme Doughnuts Inc. "It's impossible to predict if low-carb is a passing fad or will have a lasting impact.

"For several months, there has been increasing consumer interest in low-carbohydrate diets, which has adversely impacted several flour-based food categories, including bread, cereal and pasta," he said.

Until recently, Livengood said, the consumer change had "little discernible effect on our business." However, he said, recent market data suggests consumer interest in reduced carbohydrate consumption has heightened.

He said the development is most evident in sales of packaged doughnuts to grocery store customers.

In March, Krispy Kreme unveiled plans to offer a low-sugar doughnut.

Posted by Timothy Fredel at May 7, 2004 06:54 PM | TrackBack
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