Krispy Kreme Doughnuts Inc

A detailed Summary of Krispy Kreme Doughnuts Inc

Krispy Kreme Doughnuts Inc. specializes in retail donut market and was founded in 1937 in North Carolina. Today, there are over 400 stores which employ 3,900 employees in 45 states and 4 countries. The company produces about 7.5 million donuts each day. The company is one of the leading producers of donuts and is ranked 4th of the top 100 chains in the U.S. (standing as of 2004).

The company owns and franchises Krispy Kreme doughnut shops and sells over 20 different kinds of doughnuts, including its Hot Original Glazed variety.

Today, the company faces some significant challenges:

Employees are suing the company over mismanagement of retirement funds

Changes in eating habits have affected the company's revenue

In May of 2004, the Krispy Kreme stock fell almost 18 % because of changes in dieting habits, particularly the low-carbohydrate phenomenon. The sale of packaged donuts dropped dramatically. The company claimed this was impacting sales but analysts were skeptical because doughnuts are not thought of as "part of a diet", any diet. And changes in America's eating habits,

In the company's own words, "The Company also announced that the results for its fourth quarter ending January 30, 2005 have been, and may continue to be, adversely impacted by significant sales declines. For the eight weeks ended December 26, 2004, system wide and Company average weekly sales per factory store have decreased approximately 18% and 25%, respectively, compared to the corresponding weeks of the prior year. The quarter is also being adversely impacted by the substantial costs associated with the legal and regulatory matters previously disclosed. These factors may result in the Company experiencing a loss for the current quarter. KZC will work with the Company to review whether it should take certain operational actions, which could include the consolidation of store locations. Any such actions could result in substantial losses, although it is expected that any restructuring charges largely would be non- cash charges. The system wide average weekly sales per factory store, is a non-GAAP financial measure. System wide sales data include sales at all company and franchise stores. The Company believes system wide sales in

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Approximate Word count = 767
Approximate Pages = 3 (250 words per page double spaced)

Category: Miscellaneous

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