Weekly News Update
Published: Thursday, November 01, 2001
Trader Joe's First Mainstream Food Retailer to Go GM-Free
Following a year-long activist campaign to convince Monrovia, Calif.-based Trader Joe's management to stop using genetically engineered (GE) ingredients in its store-brand products, the company has made the decision to drop GE ingredients effective immediately. ""It is clear to us that if given the opportunity, the majority of our customers would prefer to have products made without genetically engineered ingredients,"" the company said in a statement on Nov. 13, noting that 90 to 95 percent of its customers said they wanted the company to stop using GE ingredients. According to Trader Joe's, its goal is to have all products that do contain GE ingredients reformulated within one year. ""We will work with any new vendor to produce private-label products for Trader Joe's without genetically engineered ingredients,"" the company said.
Pressure came primarily from the GE-Free Market Coalition, developed by Greenpeace and several other grassroots organizations, which encouraged consumers to send emails, letters and faxes to the company and staged protests outside of Trader Joe's stores in more than 20 cities. The company's action does not include branded-label products.
GNC To Expand Retail Presence in Canada
Pittsburgh-based General Nutrition Companies Inc. (GNC) is setting its sights on expansion in Canada and will be offering franchise opportunities to interested parties there. The company hopes to open 400 new stores in Canada over the next five years. Russell Cooper, GNC Franchising's senior VP and general manager said, ""We believe the current Canadian economy will encourage more people to start their own businesses … In fact, our research shows the current 2.32 million Canadian entrepreneurs is growing as the number of small businesses and self-employed Canadians increases significantly each year."" GNC's first four franchises in Canada were opened in Toronto, Ottawa Windsor and Calgary. The 400 new stores will be added to the base of 127 corporate stores in 10 different provinces.
FMI/Prevention Survey Shows Shoppers' Purchases Affected by Health Concerns
A study released by the Washington-based Food Marketing Institute and published in Prevention magazine states that approximately 58 percent of shoppers said their supermarket purchases were affected by health concerns and that 44 percent seek health information in stores, up from 36 percent in 2000. ""Shopping for Health 2001"" found that 86 percent of shoppers interviewed purchased over-the-counter medications, up 7 percent from last year, and 42 percent have purchased some type of organic food to improve their health. For more information visit www.fmi.org.
Germany Considers Kava Ban
Germany is considering banning the sale of products containing more than trace amounts of kava kava, according to Reuters. Reports of 24 cases of reported liver damage linked to the herbal supplement have provoked concern from the German Federal Institute for Drugs and Medical Devices in Bonn. A representative from the Institute told Reuters that one person has died, three have had to have liver transplants, and several have reported ailments ranging from liver failure to hepatitis to cirrhosis.
Stocks & Financial News:
Green Mountain Coffee Inc. (GMCR) has reported net sales of $20.4 million for 4Q01, a 4 percent increase over 4Q00's net sales of $21.3 million. 4Q01 net income was $1.53 million or $.23/share vs. a net income of $1.5 million or $.24/share in 4Q00.
NexMed Inc. (NEXM) has announced a net loss of $3.5 million or $.14/share for 3Q01 vs. a loss of $1.8 million or $.08/share last year. The company notes that it has approximately $24.7 million in cash, cash equivalents, certificates of deposit and marketable securities.
Galaxy Nutritional Foods (GXY) announced 2Q01 net sales of $11.4 million, a 7 percent decrease from 2Q00's sales of $12.2 million. Net loss was $5 million or $.59/share vs. a net profit of $712,230 or $.07/share last year.
Naturade Inc. (NRDC) reported net sales of $3.8 million for 3Q01 vs. similar sales of $3.8 million last year. Net loss was $890,767 or $.11/share vs. a loss of $520,569 or $.07/share last year.
Drkoop.com Inc. has declared 3Q01 revenue of $3.2 million vs. $2 million last year. Net loss for 3Q01 was $7.2 million or $.15/share vs. a loss of $58 million or $1.60/share in 3Q00.
Garden Fresh Restaurant Corp. (LTUS) announced a net loss of $876,000 or $.15/diluted share for 4Q01 vs. a net income of $1.2 million or $.21/diluted share for 4Q00. Net sales for the quarter increased 11.7 percent to $51.7 million.
Leiner Health Products Inc. reported net sales of $151 million for 2Q01, a slight decrease over 2Q00's sales of $165 million. Net loss was $12 million vs. a loss of $2.6 million last year.
Mannatech Inc. (MTEX) announced a net loss of $305,000 or $.01/share for 3Q01 vs. a loss of $1.2 million or $.05/share last year. Net sales were $30.3 million vs. sales of $37.3 million last year.
Whole Foods Market Inc. (WFMI) has been downgraded from Strong Buy to Buy by Lehman Brothers.
Briefs:
Ann Arbor, Mich.-based NSF International has acquired the Institute for Nutraceutical Advancement from Industrial Laboratories in Denver. The Institute develops and validates analytical methods for testing botanical ingredients.
Alliance Consumer International Inc. (ACIN) announced it has signed a definitive agreement with functional foods manufacturer NutraStar Inc., based in El Dorado Hills, Calif., by which NutraStar would become a wholly owned subsidiary of Alliance.
Independent dietary supplements and nutrition products evaluator ConsumerLab.com, based in White Plains, N.Y., released results of tests run on products made with Omega-3 fatty acids (EPA and DHA) from fish/marine oils. The company tested 20 products, six of which failed to pass the review's standards because they contained inadequate amounts of DHA, ranging from 50 to 80 percent of the stated amount on the label. Two products were low in EPA, containing 33 percent and 82 percent of their claimed amounts. None of the products contained detectable levels of mercury, which is often a concern with fish oil products because of possible contamination of marine life.
United States Pharmacopeia (USP) has made its Dietary Supplement Verification Program available to the public. USP will be issuing certifications based on its assessment of a manufacturer's capability to produce a dietary supplement. The certification can be used by the manufacturer on its label and according to USP, this certification indicates to the consumer, practitioner, and retailer that the supplements ingredient meets acceptable limits of ""undesirable elements and is manufactured appropriately.""
Nature's Sunshine Products Inc. (NATR) announced it has obtained exclusive worldwide rights to market an ozone water purifier, as well as rights to a compact ozone-producing unit designed for use in refrigerators to reduce the amount of airborne molds and bacteria in refrigerated foods.
Wild Oats Market Inc. announced it, along with customer contributions, will donate more than $100,000 in cash and food to charitable organizations during the holidays to support hunger programs and nonprofits in local communities around the world.
A United Nations-sponsored drive to prevent blindness in children in the Indian state of Assam using vitamin A supplementation has reportedly put 700 in the hospital, and allegedly left one child dead. Parents rushed children suffering from fever, vomiting and stomach pains to the hospital after vitamin A was given to their children by the UN humanitarian agency, Unicef, according to Reuters. While Unicef is rejecting suggestions that the Vitamin A was contaminated, samples have been sent for testing and the Indian government has banned further use of the vitamin until results can be verified.
PacificHealth Laboratories Inc. (PHLI) has entered into an exclusive sponsorship agreement with the American Hockey Coaches Association (AHCA) and the College Swim Coaches Association of America (CSCAA) by which two PHLI products, ACCELERADE and Endurox, will be recognized as the official sports drinks of both coaching associations.
In a testimony before the House Government Reform Committee on Nov. 14th, Congress was urged to consider the use of homeopathic medicine for both viral and bacterial illnesses associated with bio-terror. Those who detailed the potential benefits of homeopathic medicine at the hearing included former director of the Office of Alternative Medicine at the National Institutes of Heath, Wayne B. Jonas, M.D.
Research Briefs:
The Hartman Group Inc. based in Bellevue, Wash. has released a new report titled ""The Messy Middle: Who is the Mid-Level Wellness Consumer."" It notes that it takes a certain type of person to maintain a core wellness lifestyle, or one that is coherent and focused around the health of the mind, body, and the spirit and that mid-level wellness consumers are those who make choices based on a few of the wellness criteria, but not all of them. ""The messy mid-level wellness lifestyle is made up of picking and choosing any number of healthy lifestyle behaviors,"" ranging from 50 percent of the mid-level consumers limiting junk food, to the 41 percent that claim to exercise regularly, according to the report. Hartman found that a majority of mid-level consumers have muddled regimes and that only 13 percent of the consumers are core wellness consumers. For more information contact 425.452.0818, www.hartman-group.com, info@hartman-group.com.
The Food Policy Institute at Rutgers University in New Brunswick, N.J., has released a study that shows American consumers are confused and undecided about genetically modified (GM) food products. Only four out of 10 individuals surveyed were aware that GM foods are sold in grocery stores, and according to William Hallman, associate director of the Institute's food biotechnology program, ""Despite all of the media attention on the subject, most people report that they feel uninformed about biotechnology; few say that they have heard or read a great deal about biotech, and more than two-thirds say that they have never had a conversation with anyone about it.""
According to a national survey conducted by the Newport Beach, Calif.-based National Nutritional Foods Association, 65 percent of adults age 50 and over consider dietary supplements to be an essential element in maintaining good health. However, only four in 10 of these people are receiving supplementation recommendations from their doctors. For more information visit: www.nnfa.org.
Following the development of Airozin, a natural treatment for asthma made by Winston-Salem, N.C.-based Pilot Therapeutics Inc., N.Y.-based market research firm Roper Starch surveyed 1,505 Americans and concluded that 92 percent would try a non-prescription asthma product and 82 percent said they would seek non-prescription products to go along with their asthma prescriptions. Additionally, 80 percent of doctors are receptive to the idea of recommending natural and non-prescription products for the treatment of asthma, according to the study, which noted that 45 percent of patients request natural treatments before prescriptions and 67 percent seek natural products to go along with prescriptions. Airozin is expected to be launched sometime in 2002.
Results of the 14th annual Prepared Foods R&D Investment Survey, which surveyed marketers and individuals from large corporations, shows that 52.5 percent of respondents believe that products with all-natural labels offer significant growth potential in the coming year. Also, 43.6 percent say ready-to-eat foods offer ample opportunity for growth and 39 percent believe that ""chef quality"" products will expand in the next 12 months. Additionally, 25.3 percent of respondents stated that products with organic claims offer tremendous growth potential in the coming year. For more information visit: www.preparedfoods.com/archives/2001/2001_11/1101coverstory.htm.
Research from the University of Michigan has concluded that in times of an economic downshift, consumers reach for comfort foods and are likely to limit their intake of beverages. Candy makers Hershey Food Corp. and Mars Inc. experienced high customer satisfaction in 3Q01, and H.J. Heinz Co. retained top place within consumer brand satisfaction. However, Coca-Cola Co. and PepsiCo Inc. both saw decreased levels of consumer satisfaction, falling by 5.8 and 1.2 percent, respectively. Overall, The American Customer Satisfaction Index dropped only one-tenth of a percentage point to 72.0 from the July-Sept. period. The research was compiled from 12,500 telephone interviews.
International Briefs:
German chemical manufacturer BASF announced it will close its crystalline vitamin C synthesis line at its manufacturing site in Wilmington, N.C. by July 2002 in order to strengthen its position in the global vitamin C market by focusing manufacturing efforts in more cost-effective areas, such as directly compressible forms of vitamin C rather than the synthesis of the vitamin, which will continue to be manufactured at BASF's sites in Denmark and by its Takeda site in Hikari, Japan.
Solbar Hatzor Ltd., of Ashdod, Israel, has acquired a line of textured soy protein products from International Flavors & Fragrances Inc. (IFF) that had been sold under the Bontrae trademark. The products are sold for use in instant soups and ready-to-eat meals. Terms of the acquisition were not disclosed.