Exhibit 99.1
1-800-FLOWERS.COM(R) Signs Definitive Agreement to Acquire
Fannie May Confections Brands, Inc., a Multi-Channel Retailer and
Manufacturer of Leading Confectionery Brands Including: Fannie May(R),
Harry London(R) and Fanny Farmer(R)
CARLE PLACE, N.Y.--(BUSINESS WIRE)--April 5, 2006--
Acquisition Expected to Accelerate the Company's Growth in the Food,
Wine and Gift Basket Business, Increasing Annual Revenue in the
Category to More Than $200 Million
1-800-FLOWERS.COM (NASDAQ: FLWS), a leading multi-channel retailer
of thoughtful gifts for all occasions, today announced the signing of
a definitive agreement to acquire Fannie May Confections Brands, Inc.,
a multi-channel retailer and manufacturer of chocolate and other
confections under the well-known Fannie May, Harry London and Fanny
Farmer brands. The acquisition, for approximately $85 million in cash,
includes a modern 200,000-square-foot candy manufacturing facility in
North Canton, Ohio and 52 Fannie May retail stores in the Chicago
area, where the chocolate brand has been a tradition since 1920.
Fannie May Confections Brands, Inc. is expected to generate revenues
of approximately $75 million in its current fiscal year ending April
30, 2006. The acquisition is expected to close on or about May 1,
2006, subject to the satisfaction of customary closing conditions.
Jim McCann, CEO of 1-800-FLOWERS.COM, said, "During the past
several years, as we have aggressively expanded our Food, Wine and
Gift Basket business, we have seen chocolate and other confection
items become an increasingly important part of our gift offering. The
Fannie May, Harry London and Fanny Farmer names represent premium
candy brands, perfect as gifts for any occasion and offer a
significant opportunity for growth, particularly through the
leveraging of our assets and capabilities in the online and direct
marketing space. In addition to a collection of iconic brands that
enjoy tremendous customer affinity, we expect this acquisition to
enhance our candy category gross profit margins through extensive
manufacturing and retail capabilities. It also brings an experienced
and focused management team that can help us achieve the leadership
position we have targeted in the Food, Wine and Gift Basket category."
The Company said the acquisition would be financed through a
combination of cash on hand and bank lines of credit. McCann noted
that the Company anticipated that the acquisition will be accretive to
earnings in fiscal 2007, which begins in July, 2006. "In addition,
similar to the benefits we achieved in bakery gifts through our
acquisition last year of Cheryl&Co., we expect this acquisition to
enable us to enhance our profitability through improved gross profit
margins and synergistic benefits," said McCann.
David Taiclet, CEO of Fannie May Confections, said "In the past
two years, our team successfully revitalized Fannie May and Harry
London, building a thriving confectionery business. It was especially
heartwarming to experience how beloved Fannie May is in Chicago and
across the Midwest. Now we have the opportunity to accelerate
expansion of these great brands nationally with the significant
resources, expertise and commitment of a strong strategic partner.
With more than 15 million customers, 1-800-FLOWERS.COM's unique
multi-channel fulfillment systems and extensive direct-to-consumer
online marketing expertise will help us continue that growth. We are
thrilled to have this opportunity."
Fannie May Confections will continue to be based in Chicago and
senior management will remain with the business, which will become a
wholly owned subsidiary of 1-800-FLOWERS.COM. Dave Taiclet will
continue as CEO, Terry Mitchell as President, Matthew Anderson as CFO,
and Alan Petrik as COO. 1-800FLOWERS.COM plans to support the Fannie
May branded retail locations centered on the Chicago market. Under the
new ownership, Fannie May Confections Brands intends to continue using
the same recipes, ingredients and suppliers that have made its
chocolates a family tradition for generations.
The Harry London brand was purchased in 2003 and the Fannie May
and Fanny Farmer brands in 2004 by Alpine Confections, Inc.,
(subsequently renamed Fannie May Confections Brands, Inc. in
conjunction with the planned acquisition by 1-800-FLOWERS.COM, Inc.).
Alpine's other businesses - Kencraft, Maxfield's and Dynamic
Chocolates - are not part of the planned acquisition and will continue
to be operated under separate ownership led by Taz Murray. Alpine
Confections, Inc. was named the Candy Industry 2005 Manufacturer of
the Year by Candy Industry Magazine in recognition of its growth and
achievements in the marketplace.
About 1-800-FLOWERS.COM(R)
For more than 30 years, 1-800-FLOWERS.COM Inc. - "Your Florist of
Choice(sm)" - has been providing customers around the world with the
freshest flowers and finest selection of plants, gift baskets, gourmet
foods and confections, and plush stuffed animals perfect for every
occasion. 1-800-FLOWERS.COM(R) offers the best of both worlds:
exquisite, florist-designed arrangements individually created by some
of the nation's top floral artists and hand-delivered the same day,
and spectacular flowers shipped from our growers to your door fresh.
Customers can shop 1-800-FLOWERS.COM 24 hours a day, 7 days a week via
the phone or Internet(1-800-356-9377 or www.1800flowers.com) or by
visiting a Company-operated or franchised store. Sales and Service
Specialists are available 24/7, and fast and reliable delivery is
offered same day, any day. As always, 100 percent satisfaction and
freshness is guaranteed. The 1-800-FLOWERS.COM collection of brands
also includes home decor and garden merchandise from Plow & Hearth(R)
(1-800-627-1712 or www.plowandhearth.com); premium popcorn and
specialty treats from The Popcorn Factory(R) (1-800-541-2676 or
www.thepopcornfactory.com); exceptional cookies and baked gifts from
Cheryl&Co.(R) (1-800-443-8124 or wwwcherylandco.com); gourmet foods
from GreatFood.com(R) (www.greatfood.com); children's gifts from
HearthSong(R) (www.hearthsong.com) and Magic Cabin(R)
(www.magiccabin.com) and wine gifts from the WineTasting Network(R)
(www.ambrosiawine.com and www.winetasting.com). 1-800-FLOWERS.COM,
Inc. stock is traded on the NASDAQ market under ticker symbol FLWS.
Special Note Regarding Forward-Looking Statements:
A number of statements contained in this press release, other than
statements of historical fact, are forward-looking within the meaning
of the Private Securities Litigation Reform Act of 1995. These
statements involve risks and uncertainties that could cause actual
results to differ materially from those expressed or implied in the
applicable statements. These risks and uncertainties include, but are
not limited to: the risk that the conditions to the acquisition will
not be satisfied and, therefore, the acquisition will not close; the
Company's ability to successfully integrate its acquired companies,
including Fannie May Confections Brands, Inc.; its ability to achieve
forecasted revenue growth, enhanced profitability and other
synergistic benefits; its ability to maintain and enhance its online
shopping web sites to attract customers; its ability to successfully
introduce new products and product categories; its ability to provide
timely fulfillment of customer orders; its ability to cost effectively
acquire and retain customers; its ability to compete against existing
and new competitors; its ability to cost efficiently manage
inventories; its ability to leverage its operating infrastructure; and
general consumer sentiment and economic conditions that may affect
levels of discretionary customer purchases of the Company's products.
For a more detailed description of these and other risk factors,
please refer to the Company's SEC filings including the Company's
Annual Report on Form 10-K and Quarterly Reports on Form 10-Q. The
Company expressly disclaims any intent or obligation to update any of
the forward looking statements made in this release or in any of its
SEC filings except as may be otherwise stated by the Company.
CONTACT: Investors:
1-800-FLOWERS.COM
Joseph D. Pititto, 516-237-6131
jpititto@1800flowers.com
or
Media:
Jennifer Caccavo, 516-237-4990
jcaccavo@1800flowers.com
or
Fannie May Confections Brands, Inc.
Mark Spencer / Burson-Marsteller
312-596-3628
mark_spencer@chi.bm.com