Krispy Kreme details plans to meet low-carb challenge

By EMERY P. DALESIO
The Associated Press
5/26/04 8:39 PM
(mlive.com)


WINSTON-SALEM, N.C. (AP) -- Krispy Kreme Doughnuts said Wednesday it will respond to financial losses from popular low-carb diets with new items including sugar-free doughnuts and iced drinks.

Chief executive Scott Livengood said at a shareholder meeting the company is assuming that diets leaving little room for deep-fried treats will remain popular for a long time.

"We're not going to take anything for granted," he said.

The meeting came a day after the company's first quarterly loss since going public in 2000. Besides the $24.4 million loss for the first quarter, the company's stock has fallen by about a third in the past month.

Livengood said the company's doughnut shops and grocery displays will start selling a sugar-free doughnut, a chocolate-flavored glazed doughnut and mini rings that are 40 percent smaller. Supermarkets will start selling bags of Krispy Kreme coffee to brew at home and doughnut shops will also add crushed-ice drinks in raspberry, latte and double chocolate.

Although the company blamed trendy diets such as the Atkins and South Beach diets for its woes, critics have questioned the company's rapid expansion and suggested the Krispy Kreme phenomenon has run its course.

Livengood said the tumble in Krispy Kreme's stock price took company executives by surprise. "Frankly, it was beyond anything I could have imagined," he said.

Chief operating officer John Tate said the company will continue expanding overseas, operate more efficiently and introduce new products to attract customers who are not going low-carb.

The company has about 400 company-owned and franchised stores in 44 states, Australia, Canada, Mexico and the United Kingdom.

Krispy Kreme shares fell 23 cents to close at $19.65 Wednesday on the New York Stock Exchange.

WOODPECKER!?!?!?!?!?!?!

LOL, what stores in the UK ??? The only place you can actually buy them here is in Harrods in London ... and from what I've read about Krispy Kremes, Harrods can keep them!

I am still reading where economists and even some noted national market research firms are calling the low carb diet a "fad." One economist I talked to just a month ago said he couldn't take the low carb consumption trends seriously because "people are eating more donuts and potato chips than a year ago." It appears some statistics seemed to back that situation last fall. However, with this new Krispy Kreme development, what will the economists be saying today? Oops, another revision. It's amazing how many people who should know better have missed the boat on this diet.

The idea of eating a donut sugar free or not simply has no appeal to me. I gave up that crap in order to regain my health.

The idea of a low carb Krispy Kreme reminds me of an old Russian joke. A peasant woman in the 19th century has somehow managed to get her hands on a piece of egg bread (she and her husband have only eaten coarse rye bread before). She brings a little bit home to her husband, who says to her, "Why can't you make bread like this? It's delicious."

The woman says,"Because we can't afford white flour."

The husband says, "Then make it without white flour."

The woman says,"And we can't afford sugar."

The husband says, "Then make it without sugar."

The woman says, "And we can't afford eggs."

'"So," says the husband, "make it without eggs."

"And we can't afford the cream, either," says the woman.

"So make it without cream," says the husband.

The woman goes off to make egg bread without the white flour, sugar, eggs, or cream. She whips up a loaf and gives a piece of her husband.

"Gosh", says the husband, "this is awful...I have no idea why rich people LIKE the stuff."

Notice that they will start selling a sugar-free donut, not a low-carb donut. It will still have all the flour.

And all the trans fats.