October 14, 1997
Orlando, FL
Contact: Rebecca Barksdale
(407) 855-5500, extension 105
GALAXY FOODS ANNOUNCES FIRST SHIPMENTS OF PULLMAN/RIBBON SLICES
Orlando, FL (November 25, 1997)...Galaxy Foods Company (NASDAQ: GALX), makers of the world's most complete line of healthy cheese and dairy-related products, today announced first shipments of its revolutionary Pullman/ribbon slices to foodservice and retail deli customers. In addition to conventional-type and low fat slices, Galaxy will market lactose free, tofu-based and rice based slices, an industry first. These products are produced with state-of-the-art equipment developed over the past two years specifically for the Company's multi-position niche products.
Galaxy's President, Angelo S. Morini stated, "We are very excited about the successful installation of this equipment and subsequent first shipments of product. Having the ability to produce such a wide array of foodservice and deli products gives Galaxy the recognition as a major supplier in our industry. The addition of this system, which can produce up to $100 million in revenue, is expected to increase sales and profits dramatically."
Mr. Morini further stated, "Due to delays in ancillary equipment and the intricacies of this high-tech system, we are behind two months in filling orders. Consequently, we will recognize minimal incremental sales this quarter from this system. Additionally, last quarter, we strategically abated lower margin foodservice business to a major restaurant chain in anticipation of producing higher margin Pullman/ribbon slices this quarter. It is therefore necessary to revise our estimated sales for fiscal 1998 (ending March 31, 1998) from $30 million to $21-$23 million, with a much higher gross margin of 25%. Had we continued the lower margin foodservice business, we would have reached our projected $30 million in sales for the fiscal year with a gross margin of 18%. Changing our product mix has resulted in a greatly improved gross margin of 40%. We remain extremely optimistic about our future and look forward to solid growth for the near and long term."
Galaxy Foods Company produces a complete line of healthy cheese and dairy-related products for the retail, food service and industrial markets. Galaxy Foods is the inventor and originator of form�gg�, a new, healthier and better way to make cheese and dairy-related products. Form�gg� products are low or no fat, no saturated fat, have low or no cholesterol and no lactose and contain more vitamins and minerals than conventional cheese. Other brands' names include Soyco�, Soymage�, Veggie Slices�, Lite Bakery�, and Wholesome Valley�. For more information, contact Investor Relations at 407-855-5500, extension 105. You may also obtain more information, including the Monthly Insight Newsletter, through Galaxy's web site at http://www.galaxyfoods.com (best viewed through Netscape Navigator). To be added to the mailing list for the Monthly Insight Newsletter, call 407-855-5500, extension 307.
