Thursday, July 31, 2014

Maple Leaf profits continue decline

Maple Leaf Foods Inc. continues to lose money, but president and chief executive officer Michael McCain continues to be optimistic that things are going well.

The loss for the second quarter was $39.5 million compared with $38.4 million for the parts of the business that were not sold or closed.

The company has sold its stake in Canada Bread to Bimbo Bakery of Mexico and has begun to close some meat-processing plants in preparation for full-scale operations at a new plant at Hamilton.

McCain blamed the cost of running two supply lines for the losses, apparently referring to the closing months of business at the Schneider plant in Kitchener. That plant, which once employed more than 2,000 people, is scheduled to close before the end of the year.

McCain said the Hamilton plant is in the process of being commissioned.

The company announced an “adjusted earnings loss” of  $12.1 million compared with $32.3 million for the second quarter last year, but in the detailed report, says the losses from ongoing operations were $39.5 million this year and $38.4 million last year.

The losses so far this year total $164.2 million compared with $69 million last year.

The company has increased product prices to offset higher raw material costs, so its revenues increased even though volumes sold declined.

Sales totals for the second quarter were $831.8 million this year compared with $759.3 million last year.