BUSINESS

Maple Leaf posts loss, doubles dividend and says it expects business to recover

02/26/2015 09:52 EST | Updated 04/28/2015 05:59 EDT
MISSISSAUGA, Ont. - Maple Leaf Foods Inc. (TSX:MFI) doubled its quarterly dividend Thursday as the company said it expects its business to recover in 2015 following a year of changes that ended with a loss in its fourth quarter.

The company, which produces Maple Leaf and Schneiders prepared meats, as well as fresh pork and poultry, said it will now pay a quarterly dividend of eight cents per share.

The doubling in of the dividend came as the company reported a loss of $28.2 million or 20 cents per share for the last three months of 2014. That compared with a profit of $511.4 million of $3.58 per share a year ago, before the company sold its holdings in Canada Bread.

Sales for the quarter totalled $794 million, up from $748.3 million a year earlier.

Maple Leaf reported a loss from continuing operations of $23 million or 16 cents per diluted share for its latest quarter compared with a loss of $47.9 million or 34 cents per diluted share in the last three months of 2013.

Michael H. McCain, Maple Leaf's president and CEO, said the company has largely completed a rebuilding of the company that began in 2007 — a process that included the sale of its majority stake in Canada Bread to Grupo Bimbo as well as closures of old plants, construction of new plants and other improvements.

"We will be closing our largest legacy plant in Kitchener this week, leaving only one remaining facility in Toronto to close," McCain said Thursday.

"Our margins have been structurally reset over the year, and while volume continued to be weak in the fourth quarter, we expect it to recover in 2015 as the fundamental environment continues to improve. We are confident that we will deliver our strategic targets in 2015."

For the full year, Maple Leaf earned $711.9 million or $5.03 per diluted share, boosted by the sale of Canada Bread. That compared with a profit of $512.2 million or $3.55 per diluted share in 2013. Sales totalled $3.16 billion in 2014, up from $2.95 billion a year earlier.

Maple Leaf reported a loss from continuing operations of $213.8 million or $1.51 per diluted share for 2014 compared with a loss of $141.4 million or $1.01 per diluted share in 2013.