Flowers Foods (FLO) 8-K Flowers Foods Reports Results for the Second Quarter and First Half; Updates 2010 Sales Guidance

Exhibit 99.1

August 19, 2010 Company Press Release Flowers Foods (NYSE: FLO)

FLOWERS FOODS REPORTS RESULTS FOR THE SECOND QUARTER AND FIRST HALF; UPDATES 2010 SALES GUIDANCE

THOMASVILLE, GA— Flowers Foods (NYSE: FLO) today reported results for its 12-week second quarter and 28-week first half ended July 17, 2010. The company also updated its sales guidance for the year.

Summarizing second quarter results, Flowers Foods:

• Increased net income to $33.8 million, an 11.3% increase over last year’s second quarter of$30.3 million.

• Improved operating margins to 8.4%.

• Delivered diluted earnings per share of $.37, a 12.1% increase over last year’s second quarter of $.33. Last year’s results included a gain on acquisition of $.02 per diluted share relating to a May 2009 acquisition.

• Reported a sales decline of 1.1% compared to second quarter last year.

• Achieved volume increase of 1.9% and 1% growth from acquisitions; offset by 3.5% negative pricing/mix and .5% from the deconsolidation of a variable interest entity (VIE).

• Maintained diluted earnings per share guidance of 10% to 15% growth; revised sales guidance for fiscal 2010 to growth of 1.0% to 2.0%.

George E. Deese, Flowers Foods’ Chairman and CEO said, “We delivered strong earnings growth in the quarter and the first half of the year despite the weak economy and continued higher than normal promotional activity in the fresh bakery category. Our earnings growth would have been even greater if you take into consideration the $3.0 million, or $.02 per share, accounting gain on acquisition that was in last year’s second quarter results.

“Even though sales for the quarter declined, we achieved volume increases in both operating segments. Since the beginning of the year, our sales trend has improved steadily as we executed our strategy to introduce new products and develop new business. In the most recent weeks, that trend has further improved, giving us confidence in our revised sales guidance.

“The underlying strength of our business model is evident in our cash flow, improved operating margin, the strength of our brands, and market share growth. Our team continues to focus on improving all

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aspects of the business and we are poised to take advantage of opportunities in the marketplace,” Deese said.

Second Quarter Results

For the second quarter, sales decreased 1.1% to $607.7 million from the $614.4 million reported for last year’s second quarter. The sales decrease was attributable to negative pricing/mix of 3.5% and .5% due to the deconsolidation of a VIE. Partially offsetting these declines were increased volume of 1.9% and a 1.0% contribution from acquisitions. The volume increase was primarily driven by Nature’s Own soft variety bread and Nature’s Own sandwich rounds in the branded retail channel and the cake category in the store-brand retail channel. These increases in volume were partially offset by sales declines in white bread, specialty bread, and foodservice. Overall, the branded retail channel was down as a result of lower white bread sales and a shift in snack cake sales from branded retail to store-brand retail as several of our customers introduced new store-brand cake programs.

DSD Segment: During the quarter, the company’s direct store delivery (DSD) sales decreased 3.5%. The decrease consisted of negative pricing/mix of 3.9% and .6% due to the deconsolidation of the VIE. Increased volume of 1.0% partially offset the declines. Although total branded retail sales in the DSD segment decreased in dollars as a result of negative pricing and mix as compared to last year’s second quarter, the channel experienced volume increases due to gains in the branded soft variety and sandwich rounds categories. The increased volume in the branded retail channel was partially offset by volume declines in the store-brand retail and foodservice channels.

Warehouse Delivery Segment: Warehouse delivery sales increased 10.1%, reflecting a 5.9% contribution from acquisitions and volume increases of 4.3%. These positive items were partially offset by negative pricing/mix of .1%. The volume increase was the result of increases in the cake category in the store-brand retail channel and a modest increase in the foodservice category and increases in the contract manufacturing category of the non-retail channel.

Net income for the quarter was $33.8 million, an increase of 11.3% over the $30.3 million in the second quarter of fiscal 2009. Diluted earnings per share increased 12.1% to $.37 as compared to $.33 last year.

For the quarter, gross margin as a percent of sales was 47.6%, up 190 basis points as compared to 45.7% in last year’s second quarter. This increase was due primarily to decreases in ingredient costs, particularly flour, as a percent of sales. The decrease in ingredient costs was partially offset by higher workforce-related and packaging costs as a percent of sales.

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Selling, distribution, and administrative costs as a percent of sales for the quarter were 35.9% compared to 35.3% in the prior year. This increase as a percent of sales was due primarily to higher workforce-related and advertising costs as a percent of sales. The advertising costs were incurred to support new product introductions. These increases were partially offset by a decrease in pension costs as a percent of sales.

Depreciation and amortization expenses for the second quarter remained relatively stable as a percent of sales compared to the prior year quarter. Net interest income for the quarter was $.8 million higher than last year’s second quarter due to lower interest expense as a result of less debt outstanding. The effective tax rate for the quarter was 35.3% as compared to 36.6% last year.

Operating margin as a percent of sales for the quarter improved to 8.4% compared to 8.0% in the second quarter of 2009. EBITDA as a percent of sales for the quarter was 11.7% compared to 11.0% for the same quarter last year.

During the second quarter, the company invested $25.7 million in capital improvements and paid dividends of $18.3 million to shareholders. No shares were acquired during the quarter under the company’s share repurchase plan. Since the inception of the share repurchase plan, the company has acquired 22.7 million shares of its common stock for $367.1 million, an average of $16.15 per share. The plan authorizes the company to repurchase up to 30.0 million shares of common stock.

First Half Results

Sales for the first half decreased 1.3% to $1.40 billion compared to $1.42 billion reported for the first half of 2009. The sales decrease consisted of negative pricing/mix of 2.9% and .3% due to the deconsolidation of the VIE. Partially offsetting these declines were increased volume of .4% and a 1.5% contribution from acquisitions. The volume increase was primarily driven by Nature’s Own soft variety bread category and sandwich rounds in the branded retail channel and the cake category in the store-brand retail channel. These increases in volume were partially offset by decreased sales in white bread and foodservice.

DSD Segment: Year-to-date, the company’s DSD sales decreased 3.4%. The decrease was attributable to negative pricing/mix of 3.0% and .4% due to the deconsolidation of the VIE. Volume was flat as compared to last year’s year-to-date. Although total branded retail sales in the DSD segment decreased in dollars due to negative pricing and mix as compared to last year, the channel experienced volume increases due to increases in the branded soft variety and sandwich rounds categories. The increased

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volume in the branded retail channel was partially offset by volume declines in the store-brand retail and foodservice channels.

Warehouse Delivery Segment: For the first half, warehouse delivery sales increased 8.5%, reflecting an 8.4% contribution from acquisitions and volume increases of 1.9%. These positive items were partially offset by negative pricing/mix of 1.8%. The volume growth was the result of increases in the cake category in the store-brand retail channel and contract manufacturing in the non-retail channel.

For the first half, net income was $74.4 million, an increase of 9.9% compared to $67.7 million in last year’s first half. Diluted earnings per share for the first half increased 11.0% to $.81 as compared to $.73 last year.

Gross margin for the first half was 47.7% of sales compared to 46.3% in the first half of 2009. This increase was due primarily to decreases in ingredient costs, particularly flour, as a percent of sales. The decrease in ingredient costs was partially offset by higher workforce-related and packaging costs as a percent of sales.

For the first half, selling, distribution, and administrative costs as a percent of sales were 36.4% compared to 35.9% last year. This increase as a percent of sales was due primarily to higher workforce-related and advertising costs as a percent of sales. These increases were partially offset by a decrease in pension costs as a percent of sales.

Depreciation and amortization expenses for the first half remained relatively stable as a percent of sales. Net interest income year-to-date was $1.4 million higher than last year’s first half due to lower interest expense as a result of less debt outstanding. The effective tax rate for the first half was 35.5% as compared to 36.6% last year. The full-year tax rate is expected to remain at approximately 35.5%.

Operating margin as a percent of sales for the first half improved to 8.1% compared to 7.6% in the first half of 2009. EBITDA as a percent of sales was 11.3% year-to-date compared to 10.6% for the first half of last year.

During the first half, the company invested $54.9 million in capital improvements and paid dividends of $34.3 million to shareholders.

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Fiscal 2010 Guidance

The company maintained its earnings guidance and revised sales guidance for fiscal 2010. Deese said the company now expects sales growth of 1.0% to 2.0%. For 2010, the company continues to expect growth in diluted earnings per share of 10% to 15%. Capital spending in fiscal 2010 is expected to be approximately $95 million to $100 million.

The board of directors will consider the dividend at its regularly scheduled meeting. Any action taken will be announced following that meeting.

Conference Call

Flowers Foods will broadcast its second quarter conference call over the Internet at 10:00 a.m. (Eastern) August 19, 2010. The call will be broadcast live on Flowers’ Web site, www.flowersfoods.com, and can be accessed by clicking on the web cast link on the home page. The call also will be archived on the company’s Web site.

Company Information

Headquartered in Thomasville, Ga., Flowers Foods is one of the nation’s leading producers and marketers of packaged bakery foods for retail and foodservice customers. Among the company’s top brands areNature’s Own,Whitewheat,Cobblestone Mill,Blue Bird, andMrs. Freshley’s. Flowers operates 40 bakeries that are among the most efficient in the baking industry. Flowers Foods produces, markets, and distributes fresh bakery products that are delivered to customers daily through a direct-store-delivery system serving the Southeast, Mid-Atlantic, and Southwest as well as select markets in California and Nevada. The company also produces and distributes fresh snack cakes and frozen breads and rolls nationally through warehouse distribution. For more information, visit www.flowersfoods.com.

Statements contained in this press release that are not historical facts are forward-looking statements. All forward-looking statements are subject to risks and uncertainties that could cause actual results to differ from those projected. Other factors that may cause actual results to differ from the forward-looking statements contained in this release and that may affect the company’s prospects in general include, but are not limited to, (a) competitive conditions in the baked foods industry, including promotional and price competition, (b) changes in consumer demand for our products, (c) the success of productivity improvements and new product introductions, (d) a significant reduction in business with any of our major customers including a reduction from adverse developments in any of our customer’s business, (e) fluctuations in commodity pricing, (f) our ability to fully integrate recent acquisitions into our business, and (g) our ability to achieve cash flow from capital expenditures and acquisitions and the availability of new acquisitions that build shareholder value. In addition, our results may also be affected by general factors such as economic and business conditions (including the baked foods markets), interest and inflation rates and such other factors as are described in the company’s filings with the Securities and Exchange Commission.

Investor Contact:Marta Jones Turner (229) 227-2348

Media Contact:Mary A. Krier (229) 227-2333

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Flowers Foods
Consolidated Statement of Income
(000’s omitted, except per share data)

	For the 12 Week		For the 12 Week			For the 28 Week		For the 28 Week
	Period Ended		Period Ended			Period Ended		Period Ended
	07/17/10		07/18/09			07/17/10		07/18/09
Sales	$	607,716	$	614,448		$	1,402,742	$	1,421,455
Materials, supplies, labor and other production costs (exclusive of depreciation and amortization shown separately below)		318,553		333,339			733,351		762,801
Selling, distribution and administrative expenses		217,906		216,602			510,457		510,624
Depreciation and amortization		20,021		18,656			45,658		42,933
Gain on acquisition		0		3,013			0		3,013
Income before interest and income taxes (EBIT)		51,236		48,864			113,276		108,110
Interest income, net		956		180			2,087		639
Income before income taxes (EBT)		52,192		49,044			115,363		108,749
Income tax expense		18,436		17,947			40,920		39,819
Net income		33,756		31,097			74,443		68,930
Less: Net income attributable to noncontrolling interest		0		(756	)		0		(1,208	)
Net income attributable to Flowers Foods, Inc.	$	33,756	$	30,341		$	74,443	$	67,722
Diluted earnings per share amounts:
Net income attributable to Flowers Foods, Inc.	$	0.37	$	0.33		$	0.81	$	0.73
Diluted weighted average shares outstanding		92,358		92,630			92,316		92,979

Flowers Foods
Segment Reporting
(000’s omitted)

	For the 12			For the 12			For the 28			For the 28
	Week Period			Week Period			Week Period			Week Period
	Ended			Ended			Ended			Ended
	07/17/10			07/18/09			07/17/10			07/18/09
Sales:
Direct-Store-Delivery	$	489,919		$	507,475		$	1,136,093		$	1,175,750
Warehouse Delivery		117,797			106,973			266,649			245,705
	$	607,716		$	614,448		$	1,402,742		$	1,421,455
EBITDA:
Direct-Store-Delivery	$	63,250		$	60,645		$	144,035		$	137,112
Warehouse Delivery		16,374			15,769			35,443			34,639
Flowers Foods		(8,367	)		(8,894	)		(20,544	)		(20,708	)
	$	71,257		$	67,520		$	158,934		$	151,043
Depreciation and Amortization:
Direct-Store-Delivery	$	15,463		$	14,952		$	35,565		$	34,489
Warehouse Delivery		4,533			3,661			10,069			8,307
Flowers Foods		25			43			24			137
	$	20,021		$	18,656		$	45,658		$	42,933
EBIT:
Direct-Store-Delivery	$	47,787		$	45,693		$	108,470		$	102,623
Warehouse Delivery		11,841			12,108			25,374			26,332
Flowers Foods		(8,392	)		(8,937	)		(20,568	)		(20,845	)
	$	51,236		$	48,864		$	113,276		$	108,110

Flowers Foods
Condensed Consolidated Balance Sheet
(000’s omitted)

	07/17/10
Assets
Cash and Cash Equivalents	$	6,529
Other Current Assets		309,415
Property, Plant & Equipment, net		596,905
Distributor Notes Receivable (includes $12,794 current portion)		105,440
Other Assets		15,083
Cost in Excess of Net Tangible Assets, net		299,977
Total Assets	$	1,333,349
Liabilities and Stockholders’ Equity
Current Liabilities	$	217,690
Bank Debt (includes $20,625 current portion)		148,750
Other Debt and Capital Leases (includes $4,715 current portion)		13,823
Other Liabilities		174,380
Stockholders’ Equity		778,706
Total Liabilities and Stockholders’ Equity	$	1,333,349

Flowers Foods
Condensed Consolidated Statement of Cash Flows
(000’s omitted)

	For the 12 Week			For the 28 Week
	Period Ended			Period Ended
	07/17/10			07/17/10
Cash flows from operating activities:
Net income	$	33,756		$	74,443
Adjustments to reconcile net income to net cash from operating activities:
Total non-cash adjustments		30,109			73,008
Changes in assets and liabilities		8,883			7,846
Net cash provided by operating activities		72,748			155,297
Cash flows from investing activities:
Purchase of property, plant and equipment		(25,744	)		(54,869	)
Deconsolidation of VIE		0			(8,804	)
Other		115			2,376
Net cash disbursed for investing activities		(25,629	)		(61,297	)
Cash flows from financing activities:
Dividends paid		(18,322	)		(34,342	)
Stock options exercised		1,964			4,495
Income tax benefit related to stock awards		579			770
Stock repurchases		0			(2,115	)
Decrease in book overdraft		2,120			(578	)
Proceeds from debt borrowings		168,000			381,000
Debt and capital lease obligation payments		(203,352	)		(455,649	)
Net cash disbursed for financing activities		(49,011	)		(106,419	)
Net decrease in cash and cash equivalents		(1,892	)		(12,419	)
Cash and cash equivalents at beginning of period		8,421			18,948
Cash and cash equivalents at end of period	$	6,529		$	6,529

Flowers Foods
Reconciliation of Net Income to EBITDA
(000’s omitted)

	For the 12 Week			For the 12 Week			For the 28 Week			For the 28 Week
	Period Ended			Period Ended			Period Ended			Period Ended
	July 17, 2010			July 18, 2009			July 17, 2010			July 18, 2009
Net income	$	33,756		$	30,341		$	74,443		$	67,722
Net income attributable to noncontrolling interest		—			756			—			1,208
Income tax expense		18,436			17,947			40,920			39,819
Interest income, net		(956	)		(180	)		(2,087	)		(639	)
Depreciation and amortization		20,021			18,656			45,658			42,933
EBITDA	$	71,257		$	67,520		$	158,934		$	151,043

Flowers Foods
Reconciliation of Gross Margin
(000’s omitted)

	For the 12 Week		For the 12 Week		For the 28 Week		For the 28 Week
	Period Ended		Period Ended		Period Ended		Period Ended
	July 17, 2010		July 18, 2009		July 17, 2010		July 18, 2009
Sales	$	607,716	$	614,448	$	1,402,742	$	1,421,455
Materials, supplies, labor and other production costs (exclusive of depreciation and amortization)		318,553		333,339		733,351		762,801
Gross Margin excluding depreciation and amortization		289,163		281,109		669,391		658,654
Less depreciation and amortization for production activities		13,748		12,921		31,476		29,791
Gross Margin	$	275,415	$	268,188	$	637,915	$	628,863
Depreciation and amortization for production activities	$	13,748	$	12,921	$	31,476	$	29,791
Depreciation and amortization for selling, distribution and adminstrative activities		6,273		5,735		14,182		13,142
Total depreciation and amortization	$	20,021	$	18,656	$	45,658	$	42,933

Flowers Foods
Sales Bridge

										Impact of
										Deconsolidation			Total Sales
For the 12 Week Period Ended 07/17/10	Volume			Price/Mix			Acquisitions			of VIE			Change
Direct-Store-Delivery		1.0	%		-3.9	%		0.0	%		-0.6	%		-3.5	%
Warehouse Delivery		4.3	%		-0.1	%		5.9	%		0.0	%		10.1	%
Total Flowers Foods		1.9	%		-3.5	%		1.0	%		-0.5	%		-1.1	%

										Impact of
										Deconsolidation			Total Sales
For the 28 Week Period Ended 07/17/10	Volume			Price/Mix			Acquisitions			of VIE			Change
Direct-Store-Delivery		0.0	%		-3.0	%		0.0	%		-0.4	%		-3.4	%
Warehouse Delivery		1.9	%		-1.8	%		8.4	%		0.0	%		8.5	%
Total Flowers Foods		0.4	%		-2.9	%		1.5	%		-0.3	%		-1.3	%