July 30, 2010

Maple Leaf Foods Q2 net earnings slump 40%

Maple Leaf Foods Inc. earnings in the second quarter fell almost 40%, hurt by charges related to interest-rate swaps, though adjusted earnings improved, beating analyst expectations.

The Toronto-based food processor earned CA$3.0 million (US$2.89 million) or 2 Canadian cents a share, down from CA$4.9 million (US$4.73 million) or 4 Canadian cents a year earlier. On an adjusted basis, earnings improved, to 17 Canadian cents a share from 12 Canadian cents.

Maple Leaf said sales fell to CA$1.27 billion (US$1.22 billion) from CA$1.32 billion (US$1.27 billion), mainly due to the effects of foreign exchange on US and UK bakery operations and fresh pork sales, as well as lower sales volumes in prepared meats.

Wednesday in Toronto, Maple Leaf closed at CA$9.31 (US$8.98), down 1.5%.

Meanwhile, earlier in May, Maple Leaf Foods placed its Ontario pork processing business up for sale again after a failed attempt to unload the facility at the height of the credit crunch.

The company said it was seeing renewed interest from potential purchasers for the Burlington, Ontario-based operation amid improved economic conditions and easier access to credit.