Mrs. Paul's back in the swim of things with better supply, new product on line.

Mrs. Paul's Back in the Swim of Things With Better Supply, New Products on Line

When Mrs. Paul's left a message for Tom Hanks in the film Splash, maybe it wasn't a joke: the Philadelphia, Pa., U.S.A.-headquartered frozen fish division of Campbell Soup Co. could have used a mermaid to refurbish its image.

Now Steven A. McNeil is trying to do in fact what Daryl Hannah might have managed in fiction: make the division profitable again. He's hoping to turn a profit of $3 million this year, vs. a loss of $3.5 million last year. It isn't easy.

Everybody's supposed to be crazy about fish these days, because of its health benefits. But let the price go up, and consumers turn a cold shoulder to the frozen product. That means frozen fish processors have to buy raw material as cheap as they can to keep their customers.

Gorton's of Gloucester, which holds a 23% share of the market (vs. 21.3% for Mrs. Paul's and 18.8% for Van de Kamp's), tends to have the better sourcing, according to John M. McMillin of Prudential-Bache Securities, because it has the purchasing power of General Mills -- which also buys fish for McDonald's and Red Lobster restaurants.

When Edward J. Piszek founded Mrs. Paul's in 1946, he was able to source raw material cheaply in Poland, where he had political connections. But the Polish ties were cut when martial law was declared in 1981 and U.S. President Ronald Reagan imposed a trade embargo. Campbell, which bought the company in 1982, was faced with rising prices from 1984 to 1986, and profits began to slide.

McNeil says the situation isn't as bad as it appears; that $3.5 million loss last year would have been a $5.2 million profit except for the write-off of a plant in Doylestown, Pa., that was shut down ($6.8 million) and an actual loss of $1.9 million for Domsea Farms, an experimental farmed salmon and trout operation in Bremerton, Wash. Meanwhile, the Soviet Union is coming to the rescue as a supplier.

Under a new agreement with the Soviets, Mrs. Paul's will buy whitefish -- primarily pollock -- from the Soviet Far East fleet, and have it processed in China. Now that relations with Poland are improving again, Polish fish will again be available in substantial quantities. McNeil is also looking to update Mrs. Paul's image, by going beyond fish sticks, cakes and fillets into light fillets and microwave seafood dinners.

PHOTO : Mrs. Paul's is going upscale these days with a launch of Light Entree products formulated

PHOTO : for consumers who want more than fish sticks and fillets. The 9.5-ounce Seafood Lasagna

PHOTO : pack (top) checks in at under 300 calories per serving, as does the 9-ounce Seafood Rotini

PHOTO : (above) offering.