Penny Chapman sat in a daily management meeting at the main Chapman's Ice Cream plant Friday morning as shiny steel machines hummed in the rooms around her - mixing, churning and freezing litres of Caramel Praline, Maple Walnut and French Vanilla ice cream.

When the fire alarm went off just before 10 a.m., she and the dozen other employees of Canada's largest independent ice cream manufacturer dismissed it as a drill. They filed outside the building in Markdale, Ont. - a town of 1,400 near Owen Sound - and waited in the parking lot across the street like they had countless times before.

But then the 150 or so employees turned their eyes to a plume of grey smoke that swirled from one corner of the building.

My heart is broken. I cannot tell you how I feel. It's overwhelming and it's horrible Penny Chapman, president and co-owner of Chapman's Ice Cream

"It got rip-roaring within an hour," Ms. Chapman, president and co-owner of the company, said from her home, a few hours after she had left the site. "Flames shooting up 20 feet in the air - it was the most horrible thing you could see."

Fire departments from five small towns in the area rushed to the plant to extinguish the enormous fire, which was still roaring last night. Crews struggled with a shortage of water and eventually had to fill their hoses from a local pond. Friday night, the building - which was renovated earlier in the year - was just a charred skeleton.

All employees escaped injury, but the clouds of smoke grew so thick that the Ontario Provincial Police evacuated about 60 homes in the area, Constable David Meyer said. The police force issued a boil water advisory and asked residents to limit water use. A few patients from a neighbouring hospital were moved to other facilities.

A team of contractors had been working on an expansion project when a spark from a welding torch caught the building's insulation. Flames quickly ate their way through the insulation in a room where the company's Premium line of ice creams are produced before it spread through the rest of the building.

"Before I left there, seeing the flames come out, I cried then," Ms. Chapman said, her voice catching in her throat. "My heart is broken. I cannot tell you how I feel. It's overwhelming and it's horrible."

Markdale is still nursing a recent wound that cost $2-million. Two weeks ago, a tornado tore a destructive path through the town and into nearby Durham, Ont., where it killed an 11-year-old boy.

The storm caused minor damage at one of the other two Chapman's plants, taking down the side of a wall where some equipment was stored.

"We thought, 'We're very lucky, we're okay, it's very minor - let's carry on,'" Ms. Chapman said.

She said the fire "totalled" the main plant. Looking back at the highs and lows of her time with the company, she said Friday was "probably the worst day of my life."

Ms. Chapman was swept up into the world of frozen treats at 16 when David Chapman hired her to scoop ice cream at a Toronto shop.

Five years later, in 1973, they married. Later that year, her husband told her about a creamery he wanted to buy in Markdale so they could open their own ice cream business.

"I said, 'I have no clue where Markdale is,'" she recalled. "But then we drove all our possessions up in a station wagon to start up a new life...it was a love story."

Over the decades, the company grew from six employees to more than 350 in three facilities. The Chapmans rejected takeover offers from industry giants Unilever (makers of Breyers) and Nestlé.

"If they bought us, they'd close us down," Ms. Chapman said. "You've got to have a local, national company to fight against them to make them honest."

She said the plant's 40 office workers would be moved to a temporary facility to continue their jobs. She was not sure what the other 110 who produced ice cream would do, but insisted the company "would not abandon" them.

The company will be able to distribute ice cream for some time because its cold storage facility is filled with boxes of their products.

Ms. Chapman and her husband plan to tour the devastated site as soon as they can to jump start plans for rebuilding. Despite the past two weeks of rotten luck in Markdale, they have no plans to leave the community.

"Small towns need businesses," she said. "We're not quitting - this is not the end. This is going to end up being a fresh start."