Weekly News Update

November 16, 2000

R.A.B. Holdings Buys Guiltless Gourmet

New York-based specialty foods group R.A.B. Holdings, owner of Millbrook Distribution Services, on Nov. 6 announced that it has purchased for an undisclosed amount ""substantially all"" of the assets of Austin, Texas-based Guiltless Gourmet. According to R.A.B., 11-year-old Guiltless Gourmet is the No. 2-selling brand of baked chips.

""Guiltless Gourmet is a strong and distinctive natural foods brand name that consumers recognize,"" said R.A.B. Chairman and CEO Richard Bernstein in a company statement. ""We are very excited about the opportunity to increase our presence in the fast-growing natural food business."" R.A.B. Holdings manufactures and markets Manischewitz, Goodman’s, Gold Boat and Season products. Guiltless Gourmet is the company’s first natural foods acquisition.

Hain Celestial Group Posts Disappointing 1Q01 Results, Share Price Falls

Hain Celestial Group’s (HAIN) stock fell $3.25 Nov. 10 after the company released 1Q01 results that missed analysts’ estimates by $.07/share. HAIN posted 1Q01 net sales of $93.7 million vs. 1Q00 net sales of $87.4 million. Net income for 1Q01 was $7 million or $.21/diluted share vs. a 1Q00 net loss of $4.96 million or $.05/share. According to HAIN, the company incurred costs of $1 million or $.02/share primarily related to ""certain employee costs"" associated with the Celestial Seasonings merger.

Tucker Anthony Capital Markets and U.S. Bancorp Piper Jaffray both had EPS estimates of $.28/share for HAIN. In a research note released Nov. 10, Carole Buyers, VP at Tucker Anthony, said the company’s lower-than-expected revenue growth ""could be indicative of a slowing industry environment … and confirm[s] that even the company’s ‘rocket’ brands are not immune to slowing growth trends."" Buyers lowered her rating to Buy with a $30 price target. Yudi Bahl, VP at Piper Jaffray, on Nov. 13 reduced his FY01 EPS of $1.39/share to $1.09/share but reiterated a Buy rating on the company. HAIN closed Nov. 15 at $28.88/share.

More Financial News:

Gardenburger (GBUR) posted a 4Q00 net loss (after preferred dividends) of $20.4 million or $2.28/share vs. a 4Q99 net loss of $5.3 million or $.60/share. For FY00, GBUR posted a net loss (after preferred dividends) of $32.7 million or $3.67/share vs. a FY99 net loss of $21.8 million or $2.48/share. The company’s FY00 net sales totaled $71 million vs. FY99 net sales of $88.8 million.

Odwalla (ODWA) recorded a 4Q00 net income of $534,000 or $.05/share vs. a net loss of $467,000 or $.14/share in 4Q99. Upon news of Odwalla’s second consecutive profitable quarter, Tucker Anthony reiterated its Strong Buy rating and raised the company’s price target to $14.

Horizon Organic (HCOW) posted a 3Q00 net income of $277,000 or $.03/diluted share vs. a 3Q99 net income of $761,000 or $.08/share. Net sales for 3Q00 were $33.4 million, up 46 percent from 3Q99 net sales of $22.8 million. In related news, Piper Jaffray gave HCOW a Neutral rating, while Tucker Anthony maintained its Market Perform rating on the company.

Hauser (HAUS) reported a 2Q00 net loss of $3.1 million or $.63/share vs. a 2Q99 net loss of $1.7 million or $.34/share. Total revenues for 2Q00 were $17.4 million vs. $27.4 million in 2Q99.

Real Goods Trading Corp. (RGTC) posted a 2Q01 net loss of $575,000 or $.12/share vs. a 2Q00 net loss of $198,000 or $.05/share. RGTC had 2Q01 net sales of $3.5 million, down 13 percent vs. 2Q00 net sales of $3.98 million.

AMBI Announces Restructuring Program

In an effort to accelerate product development and improve the effectiveness of its marketing programs, AMBI Inc. (AMBI) on Nov. 13 announced a restructuring of its operations. According to AMBI, the plan includes a ""reduction of workforce"" and ""significant operational changes"" that should save the company roughly $3.5 million a year. As a result of the restructuring, AMBI says it will record a pretax charge of between $1.5 million and $2 million in 2Q01. AMBI says it has also decided not to launch its NoYo weight-loss supplement and will instead focus its efforts to ""better capitalize"" on strategic partnerships with companies such as American Home Products (AHP).

Stock News:

Perrigo Co. (PRGO) on Nov. 13 announced that its board of directors has authorized the repurchase of up to $20 million of the company’s common stock shares over the next 18 months. The purchases will be made on the open market and will be funded by cash from operations. As of Oct. 17, Perrigo had more than 73 million shares outstanding.

According to Omni Nutraceuticals (ZONE), NASDAQ on Nov. 7 halted the trading of Omni’s shares due to an announcement Omni made regarding previously reported financial results that would require restatement, resulting in the company’s former auditors withdrawing their opinions on Omni’s FY99 financial statements.

Lehman Brothers on Nov. 14 initiated coverage on Whole Foods Market (WFMI) with a Buy rating.

Piper Jaffray on Nov. 9 reduced its estimates on Natrol (NTOL) and gave it a $4 price target.

Biopharmaceuticals company Immunex Corp. (IMNX) has priced its public offering of 70 million shares of common stock at $39.75/share. Of the 70 million shares, 20 million are newly issued by Immunex, while 50 million are being offered by American Home Products (AHP) from its existing holdings of Immunex common stock.

Briefly:

According to the Associated Press, Budweiser beer maker Anheuser-Busch (BUD) plans to introduce a lightly carbonated nonalcoholic energy drink that contains vitamins B6, B12 and C, as well as guarana, a natural source of caffeine. Named ""180,"" the drink will be released Jan. 15 in 30 major U.S. markets, AP said.

International Meatless Day is Nov. 25. Founded in 1986 by the Sadhu Vaswani Mission, a social service organization in India, the International Meatless Day campaign’s intent is to raise awareness of the benefits of a vegetarian diet. To make a pledge to go meatless Nov. 25, visit www.geocities.com/meatlessday, www.sadhuvaswani.org or www.meatlessday.org.

""The Organic Lifestyle Shopper Study"" by The Hartman Group in Bellevue, Wash., found that 48 percent of its respondents reported that they occasionally use organic products, such as food, beverages, beauty aids, and household cleaning products.

According to the U.S. Department of Agriculture, U.S. corn exports for 2000/2001 were unchanged from last month’s projection of 57.79 million tonnes despite the controversy over StarLink genetically modified corn.