MISSISSAUGA, ONTARIO – Maple Leaf Foods Inc. reported a profit for the second quarter of 2020 driven by strong performances by the company’s Meat Protein and Plant Protein Groups. Sales for the second quarter ended June 30, 2020 were C$1.09 billion ($815 million) compared to C$1.02 billion ($761 million) in 2019, an increase of 7%.
“Meat Protein Group sales growth is attributable primarily to increase in hog volumes, favorable mix from growth in sustainable meats, exports to Asian markets and the positive impact of foreign currency translation,” the company said. “Meat Protein Group sales also benefited from pricing action taken in the third quarter of 2019. Plant Protein Group sales growth of 41.4% reflects investments in new products in rapidly expanding categories.”
Maple Leaf reported net earnings for the second quarter were C$25.7 million, or 21¢ per basic share, compared to a net loss of $6.3 million, or a loss of 5¢ per basic share, in the year-ago period.
“Strong commercial performance in the Meat and Plant Protein Groups was offset by strategic investment in the Plant Protein Group to drive sales growth and costs associated with COVID-19,” the company said. “Prior year results were also impacted by a higher loss from non-cash fair value changes in biological assets and derivative contracts, which are excluded in the calculation of adjusted operating earnings.”
Adjusted operating earnings for the second quarter of 2020 were C$66.7 million compared to C$65.2 million in the second quarter of 2019, and adjusted earnings per share for the period were 35¢ compared to 33¢ a year ago.
“The impact of COVID-19 to society in the past several months has been staggering, but our commitment to social purpose is steadfast,” said Michael H. McCain, president and chief executive officer. “Consistent with our core values, we are focused on the health and safety of our employees, supporting critical initiatives including the fight against food insecurity in Canada, and maintaining the stability of our supply chains to ensure we continue to deliver on our responsibilities as an essential service. Our team has performed exceptionally well in challenging times.
“Despite the unprecedented environment, we continue to execute against our strategic priorities and financial framework, which are reflected in our second quarter results,” McCain said.
Year-to-date sales for 2020 grew 9.7% to C$2.12 billion compared to C$1.92 billion last year. Maple Leaf said the sales growth reflected ongoing progress in key strategic areas for the Meat Protein Group with increases of 9%, while the Plant Protein Group delivered growth of 34.3%.
Year-to-date net earnings for 2020 were C$21.9 million, or 18¢ per basic share, compared to C$43.8 million, or 35¢ per basic share, last year.
“Strong commercial performance in the Meat and Plant Protein Groups was more than offset by strategic investment in the Plant Protein Group to drive sales growth, costs associated with COVID-19 and a higher loss from non-cash fair value changes in biological assets and derivative contracts, which are excluded in the calculation of adjusted operating earnings,” the company said.
Maple Leaf Foods reported year-to-date adjusted operating earnings of C$111.8 million compared to C$107.3 million in 2019, and adjusted earnings per share for the period were 56¢ compared to 53¢ last year.