SUBSCRIBE

Breaking News on Global Meat Trading and Processing

Headlines > Financial

Read more breaking news

 

 

Value offering grows Maple Leaf Foods’ pork sales

Post a commentBy Aidan Fortune , 24-Feb-2017
Last updated on 24-Feb-2017 at 13:18 GMT2017-02-24T13:18:56Z

Maple Leaf Foods was supported by strong demand for value-added pork
Maple Leaf Foods was supported by strong demand for value-added pork

Maple Leaf Foods’ increased focus on value-added pork products has helped the Canadian processor grow sales in 2016.

In its results for the full year to 31 December 2016, sales in its meat products division increased 1.2% to $3,316.5 million (m). Excluding only the contribution of the 53rd week in 2015, sales increased by approximately 3%.

Its prepared meats sales declined slightly in response to a price increase in the first quarter, but strengthened as 2016 progressed. The company’s success story was fresh pork, sales of which increased as its focus on value-added resulted in higher selling prices. This strong performance was bolstered by favourable exchange rates and pork markets.

Adjusted operating earnings for 2016 increased to $263.6m compared to $108.4m in the prior year. Higher earnings in its prepared meats division was attributed to lower operating costs and pricing implemented in the first quarter. Higher fresh pork earnings resulted from increased contributions from value-added retail and value-added export sales, higher industry margins and operating efficiency gains.

Fresh poultry sales for the year also increased due to “stronger volume and an improved sales mix”.

Maple Leaf Foods’ agribusiness group sales in 2016 declined slightly to $15.3m compared to $15.9m in the prior year, due to 2015 sales benefiting from a 53rd week.

We finished 2016 with a strong quarter sustained by solid commercial performance. We surpassed our Adjusted EBITDA margin target for both the quarter and full year, demonstrating the strength of the strategic foundation we have built,” said Michael H McCain, president and CEO of Maple Leaf Foods. “With the combination of our increasingly competitive cost structure, and commercial strategies that intersect with important consumer needs and trends, we are well positioned for future profitable growth.

Lightlife acquisition

Earlier this week, the business also announced that it is to acquire plant-based protein foods processor Lightlife Foods Inc.

Lightlife will operate as a subsidiary of Maple Leaf Foods out of its Massachusetts, US site. The processor manufactures more than 30 innovative products, including plant-based tempeh, hot dogs, breakfast foods and burgers.

Expanding into the fast-growing plant-based proteins market is one of Maple Leaf’s strategic growth platforms and supports our commitment to become a leader in sustainability,” said McCain. “Consumers are increasingly looking to diversify their protein consumption, including plant-based options. The acquisition of Lightlife provides Maple Leaf with a leading market position and brand in the United States in a category that is outpacing growth in the broader packaged foods sector. We will expand our presence through investment in brand-building, innovation and leveraging our respective capabilities.

Roy Lubetkin, president and CEO, Lightlife Foods, said: “We at Lightlife are truly excited about today’s announcement, which will allow us to accelerate our growth and broaden our reach in the fast-growing plant-based protein market. Maple Leaf Foods has an industry-leading commitment to sustainable protein, including a strategic focus on plant proteins, and being part of this incredible organisation will enable the continued growth of our brands.

Subject to customary US regulatory review, the deal is expected to be finalised in March and financed from cash on hand.

Post a comment

Comment title *
Your comment *
Your name *
Your email *

We will not publish your email on the site

I agree to Terms and Conditions

These comments have not been moderated. You are encouraged to participate with comments that are relevant to our news stories. You should not post comments that are abusive, threatening, defamatory, misleading or invasive of privacy. For the full terms and conditions for commenting see clause 7 of our Terms and Conditions ‘Participating in Online Communities’. These terms may be updated from time to time, so please read them before posting a comment. Any comment that violates these terms may be removed in its entirety as we do not edit comments. If you wish to complain about a comment please use the "REPORT ABUSE" button or contact the editors.

Related products

Related suppliers