July 30, 2009

Adjusted operating earnings for Maple Leaf Foods' agribusiness group have gone up in the second quarter of 2009 following hog farms sales as part of the company's restructuring.

Earnings for Maple Leaf, which includes hog production and animal by-products recycling, increased in the second quarter of 2009 to CA$16.3 million from CA$7.6 million last year.

Despite extremely challenging market conditions, the group's results improved following the sale or exit of non-core hog production operations in Ontario as part of the company's protein restructuring, and operational improvements in core operations in Manitoba.

The company owned approximately 215,000 hogs in the quarter, representing approximately 20 percent of the supply into the Brandon processing plant. Results for the second quarter also included CA$3.0 million in government support to compensate hog producers for losses in prior years.

Results from rendering operations were strong but down from the prior year period as volumes and commodity prices declined.

Adjusted operating earnings in the Meat Products Group, which includes fresh pork, poultry and turkey products, were CA$1.7 million in the second quarter of 2009.

In total, the company reported that sales for the second quarter decreased by 2.5 percent to CA$1.3 billion compared to CA$1.4 billion last year.

Adjusted operating earnings increased 131 percent to CA$43.6 million in weak protein market conditions.

US$1 = CA$1.088 (Jul 30)