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Managing
Director Explains Reorganization
By Lois Kerr
 Sugar
and volatility seem to go hand in hand. Since the very beginning
of the sugar industry in the U.S., sugar interests through the
years have weathered huge fluctuations in the price of sugar. The
past few years, the sugar industry has seen the bottom end of this
cycle, but Duffy Smith, managing director at Imperial Sugar, sees
the beginning of an upswing looming on the horizon. “The whole
sugar industry domestically has gone through tough times,” Smith
remarks. “We are used to this. However, this company is well
equipped and used to working hard. Through our preplanned
bankruptcy proceedings, we’ve hit our targets within the company
and we are truly restructured and ready to go.”
He adds, “We’ve restructured with our creditors through a
voluntary plan, and have used this to fix our balance sheet.”
Reorganization has allowed Imperial Sugar to
restructure its debts and begin again on a stronger, competitive
footing. This restructuring has support from bankers, bondholders
and growers. As well, the new board of directors understands
agriculture and commodities, and has committed itself to company
success. “We now have the healthiest balance sheet in the
industry,” Smith states. “We have a very supportive group of
creditors, a very supportive board of directors, and very
supportive growers.”
He continues, “We have long term creditor
banks. The people who hold the bonds have converted debt to equity
by becoming shareholders. With bondholders now as shareholders,
this move has changed debt to equity. These people also selected
an excellent board of directors, made up of people with experience
in commodities and in agriculture.”
With the restructuring, Imperial Sugar plans
to take on the sugar industry in the U.S. and win. Smith explains
that Imperial Sugar has set some definite goals to achieve in the
coming months and years. “We are very clear in where we are
headed,” Smith advises. “We as a company plan to act with
integrity and purpose. Everyone within the organization has a
purpose and needs to understand where we are going.”
Smith points to three key goals the company
intends to pursue vigorously: doing what the company does best,
improving on the value added aspects of marketing and continuing
to work on maintaining and improving relationships with growers
and customers to reduce risk and reduce costs. “One of our goals
is to continue to do what we do best,” Smith remarks. “Our
core competency lies in growing good beets. No one can match our
growers and our ag programs. Another core competency is in our
processing of beets and our national distribution.”
The second goal, that of value added
marketing, will also play a key role in company policy. “We want
to grow our value added capabilities,” Smith comments. “We
have the best balance of brand names (Dixie, Holly, Imperial,
etc.), packaging and value added products, in conjunction with our
bulk products.”
He continues, “Our strategy is to not just
be bulk processors. We put sugar into everything from the little
service packets to the packages found on grocery shelves to the
large packaging, plus our bulk sales. This blend, along with our
national distribution, is a key to how we’ll market more
competitively.”
Grower relations and customer relations will
remain of vital concern to Imperial Sugar. “We’ve always been
good at working with growers and with our customer to reduce risk
and reduce costs,” Smith notes. “Couple our core competencies
and the value added strategies with grower and customer relations,
and look out. This company is ready to roll.”
Smith explains that the Sidney factory
stands tall in the sugar business. “This is a rock solid
operation,” he comments. “We have exceptional grower
communication and excellent factory teams. This is exemplary, and
serves as an example to the rest of the business.”
Smith points to the near disaster area
growers and the Sidney factory faced last year. Strong grower
leadership, coupled with strong factory leadership, averted a
disaster and turned adversity into victory. “The Sidney factory
and the growers pulled last year out of a hat and made it work,”
Smith states. “We’re very proud of these folks. It was a tough
year in Sidney last year, but it doesn’t get much better than
Don Steinbeisser, Terry Cayko and Don Gorsek all working together.
The growers and the company learned a lot.”
He continues, “This reflects the good
relations with growers and the openness we have here. The Sidney
factory growers and Holly Sugar is a symbol of the integrity we
have in this company.”
Smith believes that integrity and purpose
will provide the keys to company success. “We’ll get there,”
he notes. “People with integrity and purpose make the world go
round. That’s what we’re about, and Sidney, Montana, is the
epitome of that.” |