Maple Leaf Foods posted lower net earnings in its third quarter compared to last year because of low pork prices and a weak Japanese market.
The company’s net earnings during the quarter ended Sept. 30 were $299,000, after accounting for a $10.3 million before-tax charge associated with consolidating feed mill operations and reorganizing meat processing in Atlantic Canada.
The earnings were based on sales of $1.3 billion, similar to the same period last year.
Net earnings in the same period last year were $19.3 million.
“While we continued to feel the effects of one of the most difficult protein markets in recent history, strengthening pork prices and declining cold storage stocks indicate that the worst may finally be behind us,” McCain president Michael McCain said in a News release
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During the quarter, the company increased its ownership in its Canada Bread bakery business to 84.7 percent from 81.1 percent, said it would build a $15 million feed mill in New Brunswick and announced its intention to buy Schneiders from Smithfield.
The Schneiders deal will balance Maple Leaf’s strength in primary processing and more than double the size of its processed meat operations.
Earnings from operations before unusual items were $32.8 million compared to $49.8 million in the same period last year.
By segment, third quarter operating results were: a loss in meat products of $9.7 million (earnings of $11.9 million last year); earnings in agribusiness of $25.9 million ($16.9 million) and bakery earnings of $16.5 million ($21 million).
The company said industry forecasts expect both domestic and Japanese pork markets to continue to improve in 2004.
