(Reuters) - Canadian food processor Maple Leaf Foods (MFI.TO) reported a 24 percent drop in quarterly profit on Wednesday, after the company took a $13 million charge in the value of its hogs.
Net earnings for the third quarter ended September 30 fell to C$32.6 million ($32.6 million), or 22 Canadian cents per share, from C$43 million, or 29 Canadian cents, a year ago.
Adjusted for one-time charges including the decrease in the value of its hogs, adjusted operating earnings were up 4 percent to C$76.3 million.
Grain prices soared this summer due to a severe U.S. drought, which drove up the cost of raising hogs as well as baking for Maple Leaf Foods, one of Canada’s biggest bakers.
Given that the hog industry’s problems are well known, Maple Leaf’s performance is “positive,” said analyst Robert Gibson of Octagon Capital.
“Writing down the piggies, they’re taking the hit now as opposed to later.”
On an adjusted basis, earnings per share were 29 Canadian cents, compared with 34 cents a year earlier, and analyst expectations of 31 cents, according to Thomson Reuters I/B/E/S.
Sales dropped 1.8 percent to C$1.2 billion.
$1=$1.00 Canadian Reporting by Rod Nickel in Winnipeg, Manitoba; Editing by Bernadette Baum