VALUE POSITIONING BOOSTS SALES AT FRESH BRANDS

SHEBOYGAN, Wis. -- Fresh Brands here said the "value proposition" pricing and marketing program it implemented late last year had a positive impact on sales for the year and fourth quarter ended Jan. 1.k's Supermarkets division.Net income for the fourth quarter ended Jan. 1 was $503,000 -- the company's second consecutive profitable quarter, Stinebaugh noted -- compared with a loss of $4.7 million

SHEBOYGAN, Wis. -- Fresh Brands here said the "value proposition" pricing and marketing program it implemented late last year had a positive impact on sales for the year and fourth quarter ended Jan. 1.

k's Supermarkets division.

Net income for the fourth quarter ended Jan. 1 was $503,000 -- the company's second consecutive profitable quarter, Stinebaugh noted -- compared with a loss of $4.7 million in the prior year. Sales for the quarter, which had one less week than the year-ago period, rose 4.8% to $159.3 million, and comparable-store sales for all corporate and franchise stores rose 1.2% after adjusting for the extra week in the prior year.

However, while comps for 79 Piggly Wiggly franchised stores rose 2.5%, comps for the 21 corporate stores -- excluding Dick's, which did not implement the value program -- fell 1.1%, primarily due to competitive openings near three locations, the company said.

John H. Dahley, chief financial officer, said the company expects comps to increase with the implementation of the value program at Dick's.

Sales for the year rose 11.2% to $673.1 million, with a net loss of $3 million, compared with a loss of $473,000 a year ago. The company did not release yearly comp-store results.

The company said wholesale sales for the quarter fell 7.7% to $115.2 million, reflecting the impact of the extra week a year ago; for the year, wholesale sales were down 3.8% to $486.6 million, due to the sale or closure of several corporate and franchise stores during the first half of the year.

Corporate retail sales fell 13.9% to $63.1 million for the quarter, due primarily to the extra week in last year's quarter, the company noted, and rose 31% to $284 million for the year.

4TH-QUARTER RESULTS*

Qtr Ended: 1/1/05; 1/3/04

Sales: $159.3 million; $152.0 million

Change: +4.8%

Comp-store: +1.2%

Net Income: $503,000; ($4.7 million)

Inc/Share: 10 cents; (96 cents)

52 Weeks: 2004; 2003

Sales: $673.1 million; $602.5 million

Change: +11.2%

Comp-store: Not available

Net Income: ($3 million); ($473,000)

Inc/Share: (62 cents); (9 cents)

*Fiscal 2004 was a 52-week year with a 12-week fourth quarter; fiscal 2003 was a 53-week year with a 13-week fourth quarter.