TheCattleSite.com - news, features, articles and disease information for the cattle industry

News

Cost of Change for Maple Leaf Foods

01 August 2014

CANADA - Maple Leaf Foods has seen sales from continuing operations of C$831.8 million for the second quarter.

This was an increase of 9.6 per cent from last year, or 8.2 per cent after adjusting for the impacts of foreign exchange, as higher pricing was partly offset by lower volume.

Sales from continuing operations ofC$1,543.1 million for the first six months was an increase of 6.5 per cent, or 5.3 per cent after adjusting for foreign exchange, due to the same factors.

Adjusted Operating Earnings for the second quarter was a loss of C$12.1 million compared to a loss of C$32.3 million last year, as improved market conditions in the Agribusiness Group than offset lower earnings in the Meat Products Group. For the first six months, Adjusted Operating Earnings increased but was a loss of C$42.0 million compared to a loss of C$60.1 million last year, due to similar factors.

Net loss from continuing operations for the second quarter was C$39.5 million (loss of C$0.28 per basic share attributable to common shareholders) compared to a loss of C$38.4 million (loss of C$0.27 per basic share attributable to common shareholders) last year. Net loss from continuing operations includedC$20.0 million (C$0.11per basic share attributable to common shareholders) of pre-tax expenses related to restructuring and other related costs (2013: C$14.4 million, or C$0.07 per basic share attributable to common shareholders).

For the first six months, net loss from continuing operations was C$164.2 million (loss of C$1.17 per share attributable to common shareholders) compared to a net loss of C$69.0 million (loss of C$0.49 per basic share attributable to common shareholders) last year.

Net loss from continuing operations included C$41.8 million (C$0.22 per basic share attributable to common shareholders) of pre-tax expenses related to restructuring and other related costs (2013: C$51.3 million or C$0.27 per basic share attributable to common shareholders). Net loss also included financing costs of C$98.6 million related to the repayment of the Company's long-term notes payable in April 2014.

Adjusted Earnings per Share was a loss of C$0.13 in the second quarter of 2014 compared to a loss ofC$0.25 last year. For the first six months, Adjusted Earnings per Share was a loss of C$0.37 compared to a loss of C$0.48 last year.

Several items are excluded from the discussions of underlying earnings performance as they are not representative of ongoing operational activities. Please refer to the section entitled Reconciliation of Non-IFRS Financial Measures at the end of the Management Discussion and Analysis on page 11 for a description and reconciliation of all non-IFRS financial measures.

"We continue to make good progress on our strategic agenda, although the transitory cost of duplicative supply chains continues to be significant," said Michael H. McCain, President and CEO .

"We implemented material price increases during the second quarter which going forward will fully offset significant raw material cost increases to date.

“As anticipated, there is a short-term impact on demand, which we expect will normalise in time. Our progress in converting to the new supply chain continues as performance improves in our Western facilities and commissioning of the new flagship plant in Hamilton, Ontario is underway.

“Following the successful sale of our bakery business, we completed a comprehensive organizational restructuring in the quarter, right-sizing our structure to cost effectively support our needs as a focused value-added protein company.

“We are managing significant change along with our base business performance, and we are very satisfied with our progress towards our financial targets."

TheCattleSite News Desk

Top image via Shutterstock



Our Sponsors

Partners


Seasonal Picks

Charismatic Cows and Beefcake Bulls