Flowers Foods Targets $20 Million in Savings Amid Bank Talks

Flowers Foods is targeting about $20 million in cost savings this year while seeking additional flexibility from its lead banks. The company remains in compliance with its bank covenants as discussions continue, and management expects to provide an update before year-end.

Management expects procurement and bakery efficiencies to drive the savings. It is also weighing capital spending, investment and the dividend among possible balance-sheet levers as it considers how to manage the bank discussions.

The company expects raw-material inflation to increase as hedges expire. Management expects cost pressure to continue through the first half of 2027, while wheat costs may provide some relief in the second half.

Nature’s Own has shown improving sequential share trends since its relaunch, though management said the pace has been slower than expected.

The cost and bank discussions follow a weaker third quarter: sales fell 4.7%, and packaged bread volumes declined 7%. Flowers lowered its 2026 sales, EBITDA and earnings-per-share outlook after the quarter; the company’s outlook revision was covered earlier.