Winnipeg Free Press - PRINT EDITION

Food processor reaping rewards

Crops abundant, demand on rise

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THE weather is co-operating, customers are ramping up their orders -- life is good and getting better for specialty-crops processor and exporter Legumex Walker Inc.

The Winnipeg company, which was formed last summer with the merger of three companies, was back in the black in the second quarter after posting an operating loss in the first three months of the year.

On Tuesday, the firm reported a profit of $300,000, or three cents a share, for the quarter that ended on June 30.

That was a marked improvement from the loss of $1.8 million, or 13 cents per share, it posted in the first quarter of the year.

On top of that, the areas where Legumex Walker buys most of its specialty crops -- Manitoba, Saskatchewan and the northern Midwestern U.S. -- have been spared from the severe drought that has devasted crops in many other areas of the U.S. Midwest.

Company president and CEO Joel Horn said most of the areas are reporting average to above-average crops this year, which should mean a good supply of peas, lentils, and beans for Legumex to process later this year and in 2013. And that's good news because demand for specialty crops is also on the upswing, he added.

"We are beginning to see an improvement in demand for specialty crops as those buyers impacted by politcal uncertainty (in the Middle East), currency fluctuations and the European financial crisis are gradually coming back to the market to replenish depleted inventories."

Horn said he also expects that trend to continue through the remainder of the year.

Legumex Walker processes and exports pulse crops, including peas, beans, lentils, and chickpeas, as well as other specialty crops and canola products. It has 11 processing plants in Canada and the United States, including four in Manitoba, a bean-processing facility in China and a new canola-seed crushing plant under construction in Washington state.

Horn said the devastation of much of the U.S. soybean crop is helping to fuel an increased demand for canola meal and canola oil. And the company's new Pacific Coast Canola plant in Washington should be coming on line, as planned, in the first quarter of 2013, he added.

Legumex Walker shares (TSX:LWP) closed Tuesday up 65 cents to close at $7.40.

murray.mcneill@freepress.mb.ca

Republished from the Winnipeg Free Press print edition August 15, 2012 B5

History

Updated on Wednesday, August 15, 2012 at 9:26 AM CDT: corrects that profit was $300,000, not $30,000

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