TORONTO -- Maple Leaf Foods Inc. posted a $14.8-million loss in what the company concedes was a "very difficult" first quarter, but CEO Michael McCain described the problems as both "transitory" and "self-correcting."
"This was a very difficult quarter, with lower earnings in our protein business overshadowing good improvement in our bakery results," McCain said.
The company's meat business, which had enjoyed several years of steady improvement, was hurt in the quarter by poor market conditions, weaker volumes in the wake of necessary price hikes and transition costs related to its new network.
"But I think the most important thing to recognize is this is a short-term impact -- more severe than we anticipated -- but it is transitory as part of the expected market bubbles connected to the droughts of last summer," he said.
"Longer term, our strategies are working. Over the past four years we have doubled our EBITDA margins as a result of changes in the investments in our business and we expect to continue to invest in margin expansion through 2015."
Maple Leaf said the loss amounted to 11 cents per share in the period ending March 31 compared with a loss of just under $6 million, or four cents per share, a year ago.
The more substantial loss came as sales fell to $1.11 billion from $1.16 billion in the 2012 quarter, a 4.1 per cent decrease year over year or 2.3 per cent after adjusting for divestitures and foreign exchange as lower volumes were partly offset by higher prices.
-- The Canadian Press