February 24, 2010 / 6:54 PM / in 8 years

WRAPUP 1-Maple Leaf, Cott report profits despite weak links

* Cott EPS $0.17 vs consensus view $0.09

* Cott shares up 2.1 percent at C$8.12

* Maple Leaf Foods adj EPS C$0.19 vs consensus view C$0.22

* Maple Leaf shares down 2.1 percent at C$10.97

By Scott Anderson

TORONTO, Feb 24 (Reuters) - Two Canadian food and beverage producers, Maple Leaf Foods Inc MFI.TO and Cott Corp BCB.TO COT.N, returned to profit in the fourth quarter but weakness persisted in some of their businesses.

Maple Leaf, one of Canada’s largest food processors, said on Wednesday it climbed back into the black in the quarter due to solid results at its prepared meat and fresh poultry businesses.

Profit at its key bakery business, Canada Bread, however, fell short of analysts’ forecasts due to higher advertising costs to launch new products and lower sales at its British division.

Soft-drink maker Cott Corp BCB.TO COT.N also posted a quarterly profit on Wednesday as a strong performance at its British operations more than offset weakness in its North American and Mexican operations.

Maple Leaf said it earned C$21.9 million ($20.8 million), or 16 Canadian cents a share, in the fourth quarter, ended Dec 31, compared with a loss of C$14.6 million, or 12 Canadian cents a share, in the same period a year earlier when it was trying to shake off the lingering effects of a costly food recall.

Adjusted for the impact of restructuring and product recalls, the company earned 19 Canadian cents a share, compared with 12 Canadian cents for the same period a year earlier.

Revenue slipped 1 percent to C$1.32 billion.

Analysts had expected, on average, earnings per share of 22 Canadian cents on revenue of C$1.33 billion, according to Thomson Reuters I/B/E/S.

By midday, its shares were down 2.1 percent at C$10.97 on the Toronto Stock Exchange.

“A good proportion of the miss was on the bread division and the U.K. operations were also weak,” said Ken Chernin, a special situations analyst at Jennings Capital in Halifax, Nova Scotia. “Bakery to me was a disappointment for the quarter.”

Still, Maple Leaf’s results showed it has come a long way from the dark days of 2008, when contaminated deli meats from a Maple Leaf food processing plant in Toronto were linked to at least 20 deaths.

After an extensive investigation, the company said it believed two slicers at the plant had been harboring the listeria bacteria.

Cott, the world’s largest maker of private-label soft drinks, said it earned $15.1 million, or 17 cents a share, for the quarter ended Jan. 2, compared with a loss of $11.7 million, or 17 cents a share for the same time last year.

Revenue rose 3.9 percent to $386 million.

Analysts on average were expecting earnings of 9 cents a share and revenue of $374 million, according to Thomson Reuters I/B/E/S.

Although its results beat expectations, some analysts thought the company could have fared even better.

“Cott’s reported North American bottled segment volume growth was disappointing, coming in at minus 4 percent in a market where volumes probably experienced low single-digit growth,” Perry Caicco, an analyst at CIBC World Markets, said in a note. ($1=$1.05 Canadian) (Reporting by Scott Anderson; editing by Peter Galloway)

0 : 0
  • narrow-browser-and-phone
  • medium-browser-and-portrait-tablet
  • landscape-tablet
  • medium-wide-browser
  • wide-browser-and-larger
  • medium-browser-and-landscape-tablet
  • medium-wide-browser-and-larger
  • above-phone
  • portrait-tablet-and-above
  • above-portrait-tablet
  • landscape-tablet-and-above
  • landscape-tablet-and-medium-wide-browser
  • portrait-tablet-and-below
  • landscape-tablet-and-below