Overall, the company reported first quarter sales of $506 million, a 10.5% increase compared to the previous year's quarter. Besides booming foodservice sales, the company  benefited from a 6.75% increase in retail sales and price increases that contributed  4.3% of the sales increase in all distribution channels. In addition, a favorable product mix shift and volume increase contributed to 6.2% of the company's overall sales increase. This volume and mix increase resulted from burgeoning sales in the company's core business, the expansion of the company's direct-store-delivery system into new markets and products, and the September 2004 Texas acquisition.

"The strength of Flowers Foods' strategy to provide quality products through multiple distribution channels is reflected in our sales growth in both retail and foodservice channels," George Deese, Flowers Foods' president and chief executive officer, said. "We remain focused on sound execution through our direct-store-delivery system, which enables us to grow in our core territory and expand into new markets."

Since 2003, Flowers Foods march north has resulted in the successful entrance into many new markets: Northern Virginia; Southern Missouri; Oklahoma City; Lexington, Ky.; Owensboro, Ky.; Louisville, Ky.; and the Mid- and Coastal-Carolinas. The company said that it reaches 10 million new customers through these markets.

As a result of its positive financials, Flowers Foods took several actions. The company increased its fiscal 2005 sales guidance to $1.65 billion to $1.675 billion from prior guidance of $1.60 billion to $1.625 billion.

The company also acquired about 2.7 million shares of its common stock for $78.2 million, and announced a three-for-two stock split and an increased dividend.