Annie's announces recall on frozen pizza; shares drop 12%

Apparently metal mesh wouldn’t count as organic.

One of last year’s hottest IPOs, Annie’s Inc., just fell 12% in after hours trading after announcing a recall of its frozen pizza products “due to the possible presence of fragments of flexible metal mesh caused by a faulty screen at a third-party flour mill.”

Annie’s says it hasn’t actually found any metal mesh in its finished products, and it hasn’t received any complaints, but was worried the mesh would have gotten through its regular screening issues. It is now using a different flour supplier, it added.

The company added in a filing it is “too early” to know the final cost, but does expect its fiscal third quarter to be impacted as well as future quarters.

Annie’s said in a filing it had expected sales of approximately $37 million for the third quarter, in line with analyst expectations, according to Thomson Reuters. That number will likely be lower and it expects pizza sales for the fourth quarter to be reduced before it begins shipping replacement pizzas in February.

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