behind us, and we believe we have a great deal of momentum in our business as we
move into 2002 and beyond.
From August of 2001 onward, our company portfolio of premium brands, the core
of our business, posted a volume increase of 12 percent. What makes this increase
particularly gratifying is that we simultaneously realized price increases of about
1.5 percent ®not enough to cover the short-term dairy cost spike, but a good gain
nevertheless. This core business resurgence helped drive our best market share
performance ever in the fourth quarter of 2001 as Dreyeròs portfolio of company brands
held a 20 percent dollar share of all packaged ice cream sold in U.S. grocery
stores ®about a point ahead of our nearest competitor. Overall, our sales grew by
17 percent in 2001 and the strong momentum of the second half has continued
into the first months of 2002.
Weòre obviously proud of our pace of growth, which puts us in the top tier of the food
category. Even though the dairy price decline came too late to help 2001 results in
any meaningful way, we believe that the current trends ®both in sales growth and
costs ®bode well for 2002.
C H A N G I N G T H E N A M E A N D C H A N G I N G T H E G A M E
Our business model is built on two mutually reinforcing strengths: brand leadership
and direct-store-delivery (DSD). We have been committed to this vision from the
beginning. When we began our march toward national preeminence in 1994, there
were still people who were skeptical about a strategy based on direct-store-delivery.
Today, the strengths of DSD are apparent in category-leading brands across the food
industry. In our category, as in snack foods, beverages, and so many others, companies
with first-class DSD systems build sales and market share in ways that competitors
without this capability cannot match.
Our approach to direct-store-delivery has evolved significantly over the years. Our
strategic emphasis is not really on ³delivery² ®transporting product to stores, itòs on
³service.² We build our brands not just by how we get to the store, but by what we
do in the store. Keeping a wider variety of brands and flavors than any other competitor
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