Annie's recalls frozen pizzas, shares fall aftermarket
(Reuters) - Organic foods maker Annie's Inc (BNNY.N), known for its bunny mascot, said it started a voluntary recall of certain frozen pizzas due to a possible presence of metal particles, sending its shares down nearly 13 percent after the bell.
The Berkeley, California-based company, which went public last March, announced the recall after learning that fragments of flexible metal mesh were found in flour and pizza dough as a mesh screen failed at a third-party flour mill.
All varieties of Annie's rising crust frozen pizza with expiry dates between January 9, 2013 and September 14, 2013 have been affected, the company said on Tuesday.
There have been no consumer complaints, illnesses or injuries reported, said Annie's which also makes macaroni, cheese and snack crackers.
The company said it expects to record related charges in the third quarter, and sees pizza sales fall in the fourth quarter.
Before recording costs associated with the recall, the company expected to report net sales of about $37 million for the third quarter.
It expects to incur additional charges from the recall in future quarters but will reverse charges from costs that are recovered under its recall insurance and from the third-party supplier, Annie's said.
"We expect to be shipping new pizza products in February," Chief Executive John Foraker said on a hastily arranged conference call.
The company is now sourcing flour from an alternate mill and plans to re-evaluate its ingredient suppliers and contract manufacturers to toughen plant qualification processes, Foraker said on the call.
Annie's said it is working with the U.S. Food and Drug Administration and the U.S. Department of Agriculture to resolve the issue.
Annie's shares fell to $33.30 in extended trading. They closed at $38.47 on the New York Stock Exchange on Tuesday.
(Reporting by Siddharth Cavale in Bangalore; Editing by Joyjeet Das, Supriya Kurane)
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