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Monday, March 28, 2011

Failure is near, Tastykake accountants warn
Shares of Tasty Baking Co., maker of Tastykakes, slipped to a 28-year low today after the Philadelphia snack bakery told the SEC in this filing late Friday that "the Company is unable to file" its 2010 annual report on schedule because it's busy trying to sell the firm.

In January the company said it had made deals with its banks, state agencies, landlord Liberty Property Trust, and other creditors to delay payments while it looks for a buyer to take over the company or some other "possible strategic and financial option."

That followed the failure of Tasty's new state-subsidized South Philadelphia bakery to meet initial sales targets; higher ingredient costs; and the bankruptcy of A&P, a major supermarket customer. The creditors gave Tasty until June 30.

The company said it still hopes to file its annual report within the next two weeks. But it warned it's likely to "include an explanatory paragraph from the Company’s independent registered public accounting firm expressing substantial doubt about the Company’s ability to continue as a going concern."

Mexican-owned Group Bimbo (whose US operations are based in Montgomery County) and Georgia-based Flowers Foods (which has been in Tastykake merger talks before) are among the possible buyers, as I wrote in January.
Posted by Joseph N. DiStefano @ 11:33 AM  Permalink | 49 comments
Comments   
  • 0 like this / 1 don't   •   Posted 12:23 PM, 03/28/2011
    Updating my "Things that aren't there anymore," file...
    — baworks
  • 0 like this / 0 don't   •   Posted 12:33 PM, 03/28/2011
    Goodbye Tastykake! Your products suck and they are expensive. There are better choices one can spend their money on.
    — Wildman Bill
  • 0 like this / 0 don't   •   Posted 6:21 PM, 03/28/2011
    I remember when the icing on Butterscotch Krimpets used to stick to the wrapper, but it tasted so good, we'd lick the wrappers clean. Somewhere along the way, Tastykake exercised some cost-cutting measures which affected the taste and size of their products. Tastykakes were once sought after nationwide and now Philadelphians don't even want them. Their products no longer taste good.

    There are some very important lessons to be learned here.
    — Lonewolf11
  • 0 like this / 0 don't   •   Posted 12:34 PM, 03/28/2011
    Where will Philadelphians get their bland Butterscotch Krimpets?
    — FletcherT
  • 0 like this / 1 don't   •   Posted 12:37 PM, 03/28/2011
    Overrated and overpriced...cya...I'll stick with Little Debbies and Drakes
    — SpeakPhilly.com
  • 0 like this / 0 don't   •   Posted 12:46 PM, 03/28/2011
    Pizzi ruined a Philly institution.

    On the bright side, if Tasty Kake can fail, then anything is possible. Perhaps Chris Wheeler will disappear yet.
    — Paperchase
  • 0 like this / 0 don't   •   Posted 12:49 PM, 03/28/2011
    so if tastykake closes, will gas prices go up?
    — AEPi71
  • 0 like this / 0 don't   •   Posted 5:51 PM, 03/28/2011
    That was funny. Well done!
    — ragecage22
  • 1 like this / 1 don't   •   Posted 12:54 PM, 03/28/2011
    Tastykake and Tastypie's were always fresh. In the 65 years that I have been enjoying Tastykake I have only fond memories and my waistline to remember.
    Something I learned .a long time ago, "you get what you paid for"
    Tastykake is a superior product and No one even comes close.
    — blackstone
  • 0 like this / 0 don't   •   Posted 6:23 PM, 03/28/2011
    You should have your tastebuds examined. Tastykakes "used to" taste great. Now, they taste like grease!
    — Lonewolf11
  • 0 like this / 0 don't   •   Posted 12:57 PM, 03/28/2011






    Typical Philadelphians, Kick ya when you are down.... This not a city of brotherly love, we should drop that moniker all together and cakll it, PHILADELPHIA: The city that hates you back.






    — ArseoleChris
  • 0 like this / 0 don't   •   Posted 1:02 PM, 03/28/2011
    Pizzi should be sent to Jail.
    — ZOSO
  • 0 like this / 0 don't   •   Posted 1:02 PM, 03/28/2011
    So sad about this news.
    — Julius May
  • 0 like this / 0 don't   •   Posted 1:36 PM, 03/28/2011
    Tastykake is a victim of its own doing with some special help from the Federal Government. First, they priced themselves out of the market. More importantly, they and numerous other companies bowed to the pressures from the Democrats in Congress along with our illustrious, current leader whom imposed a ban on trans-fats. That's what made these treats taste so good for the first 100 years of the company. Once they made the transition to non-trans fats, the products didn't even resemble a reasonable facsimile of their former great taste. I sent them a letter about the disgusting taste of their pies and never even got an acknowledgement. Customer service it seems also went to hell along with the mis-management. Of course, our politicians couldn't help but continue throwing more taxpayer money at another losing proposition. Current management destroyed this company.
    — wlkelly
  • 0 like this / 0 don't   •   Posted 12:26 PM, 03/29/2011
    Nonsense re trans fats. When Tastykake started up a hundred years ago, no one used trans fat to bake products with. Tastykake for many years used only natural ingredients (i.e., butter)

    And Tastykake didn't get rid of trans fats because of political pressure, but consumer pressure. People began to avoid food with trans fats, so Tastykake and many other companies (but certainly not all) decided to eliminate trans fats so it could advertise "no trans fats" Good ol' supply and demand. (Government regulation has in some areas affected restaurants' use of trans fats, but there is no regulation whatsoever of the use of trans fats in packaged goods). There is no federal ban on trans fats. The only change the federal government made re trans fats was in 2003, when the Bush administration's FDA ordered that manufacturers list how much trans fat is in their products, just as they do with saturated fat.

    Stop listening to right-wing babble. You don't get to make up your own facts.
    — gspira


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About Joseph N. DiStefano
Joseph N. DiStefano writes this blog to feed his PhillyDeals column in the Philadelphia Inquirer. Joe has been a member of Bloomberg LP’s New York Finance Team, wrote the book “Comcasted,” taught writing at St. Joseph’s University, and studied economics and history at Penn. Reach Joe at 215-854-5194 and JoeD@phillynews.com
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