Maple Leaf Foods posts loss as production revamp drives up costs

Thu Feb 27, 2014 7:53am EST
 
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Feb 27 (Reuters) - Canadian food processor Maple Leaf Foods , which has been replacing production facilities and setting up a new distribution system, reported a quarterly loss that it blamed on the "tremendous" costs of the restructuring.

"We are in a peak phase of executing our prepared meats network strategy, which added tremendous costs and inefficiency in the quarter as we ramped up five new facilities while continuing to operate our parallel older plants," Chief Executive Michael McCain said in a statement on Thursday.

McCain said the restructuring was causing "short-term earnings volatility." Weak protein markets also weighed on results in the quarter ended Dec. 31, he said.

The company reported a net loss from continuing operations of C$14.4 million ($12.96 million), or 13 Canadian cents per share, for the fourth quarter, compared with a net profit of C$41.0 million, or 27 Canadian cents per share, a year earlier.

Sales fell 2 percent to C$1.11 billion.