B&G Foods, Inc. BGS recently entered into an agreement with DSC Logistics, a leading logistics and supply chain management company. According to the five year agreement, DSC will offer warehousing and distribution management services at B&G Foods’ three primary distribution centers.
DSC will ensure that B&G Foods has well-equipped warehousing and distribution systems in order to support its acquisition strategy. DSC’s expertise in logistic services will ensure that B&G Foods improves its customer service and minimizes its expenses. B&G Foods expects to reap cost benefits from this agreement from the second half of 2016.
This agreement will support B&G Foods in maintaining its strong quarterly results by reducing expenses. The company’s first quarter 2015 results were impressive.
In the first quarter, B&G Foods benefited from strong sales of Speciality Brands and an increase in pricing. Speciality Brands has been performing well and driving the company’s revenues in the past few quarters.
Moreover, management increased pricing of half of the product lines by about 2%, effective from Jan.
Improving pricing and volume trends witnessed in the first quarter of 2015 are expected to continue in the rest of the year. In addition, the company has planned a number of product innovations in 2015, which are expected to drive revenues in the upcoming quarters of 2015.
B&G Foods holds a Zacks Rank #2 (Buy).
Investors interested in the consumer staples space can also consider stocks like Fufeng Group Limited FFNGY, Boulder Brands, Inc. BDBD and Cal-Maine Foods, Inc. CALM. While Fufeng Group Limited sports a Zacks Rank #1 (Strong Buy), Boulder Brands and Cal-Maine Foods hold a Zacks Rank #2.
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