The Globe and Mail

Go to the Globe and Mail homepage

Jump to main navigationJump to main content

Globe Investor

News Sources

Take control of your investments with the latest investing news and analysis

Press release from CNW Group

Maple Leaf Foods Reports Results for Fourth Quarter and Year-End 2012

Tuesday, February 26, 2013

Maple Leaf Foods Reports Results for Fourth Quarter and Year-End 201208:04 EST Tuesday, February 26, 2013TSX: MFIwww.mapleleaffoods.comTORONTO, Feb. 26, 2013 /CNW/ - Maple Leaf Foods Inc. (TSX: MFI) today reported its financial results for the fourth quarter and fiscal year ended December 31, 2012.Highlights for the fourth quarter of 2012 include:Adjusted Operating Earnings(1) increased 58.9% to $91.3 millionNet earnings increased to $56.8 million from $9.2 million last yearAdjusted Earnings per Share(2) increased to $0.38 from $0.21 last yearEBITDA(3) margins were 10.6% for the companyHighlights for the full year 2012 include:Adjusted Operating Earnings increased 8.1% to $280.0 million following strong second half resultsNet earnings increased 40.5% to $122.7 millionFull year Adjusted Earnings per Share was $1.06, compared to $1.01 last year (2011 includes $0.09 per share tax adjustments related to a prior acquisition)"We are very pleased with our results for the fourth quarter and 2012 in total. They reflect steady, ongoing progress in realizing earnings growth towards our financial targets," said Michael H. McCain, President and CEO. "The challenging market conditions in primary pork processing margins and consumer bread demand were significant headwinds for the year; however, we achieved an 8% increase in operating profits for the year and 59% in the fourth quarter despite these challenges. This is a strong testament to the strength of our business and our strategic initiatives, and the extraordinary contribution of our people. The effects of food inflation driven by the North American droughts of 2012 will be felt mostly in the first half of 2013.  As a result, we expect some short-term volatility in our earnings as we pass those cost increases on in the marketplace. Beyond this, our strategic initiatives will accelerate in 2013 and contribute to continued margin growth."(1): Adjusted Operating Earnings, a non-IFRS measure, is used by Management to evaluate financial operating results. It is defined as earnings before income taxes adjusted for items that are not considered representative of on-going operational activities of the business, and items where the economic impact of the transactions will be reflected in earnings in future periods when the underlying asset is sold or transferred. (2): Adjusted Earnings per Share, a non-IFRS measure, is used by Management to evaluate on-going financial operating results.  It is defined as basic earnings per share attributable to common shareholders, and is adjusted for all items that are not considered representative of on-going operational activities of the business, and items where the economic impact of the transactions will be reflected in earnings in future periods when the underlying asset is sold or transferred.(3): EBITDA is calculated as earnings from operations and before interest and income taxes plus depreciation and intangible asset amortization, adjusted for items that are not considered representative of on-going operational activities of the business, and items where the economic impact of the transactions will be reflected in earnings in future periods when the underlying asset is sold or transferred.Please refer to the section entitled Reconciliation of Non-IFRS Financial Measures at the end of this news release. Financial OverviewSales for the fourth quarter declined 3.3% to $1,204.8 million compared to $1,245.3 million last year, or 2.2% after adjusting for the impacts of divestitures and foreign exchange,  primarily as a result of lower sales volumes. For the full year, sales were $4,864.8 million, down 0.6% from $4,893.6 million in 2011, or 0.3% after adjusting for divestitures and foreign exchange.Adjusted Operating Earnings for the fourth quarter were $91.3 million compared to $57.4 million last year, due to strong improvements in the Meat and Bakery Products Groups.  For the full year, Adjusted Operating Earnings increased 8.1%, to $280.0 million compared to $259.0 million last year due to increased earnings in the Meat and Bakery businesses.Adjusted Earnings per Share were $0.38 in the quarter, compared to $0.21 last year. For the year, Adjusted Earnings per Share were $1.06, compared to $1.01 last year.  Adjusted Earnings per Share in 2011 included $12.2 million ($0.09 per share) of tax adjustments related to a prior acquisition.For the fourth quarter, net earnings were $56.8 million ($0.39 basic earnings per share) compared to $9.2 million ($0.06 basic earnings per share) last year.  Net earnings included $12.8 million ($0.07 per share) of pre-tax costs related to restructuring activities (2011: $32.2 million, or $0.17 per share). For the full year, net earnings were $122.7 million ($0.83 basic earnings per share) compared to $87.3 million ($0.59 basic earnings per share) last year.  Net earnings for the year included $47.5 million ($0.25 per share) of pre-tax costs related to restructuring activities (2011: $79.8 million, or $0.41 per share).Several items are excluded from the discussions of underlying earnings performance as they are not representative of on-going operational activities.  Refer to the section entitled Reconciliation of Non-IFRS Financial Measures in this news release.Business Segment ReviewFollowing is a summary of sales by business segment:      Fourth QuarterYear-to-Date(Unaudited)(Audited)($ thousands)2012201120122011Meat Products Group$740,764$781,813$3,003,444$3,039,460Agribusiness Group 73,410 63,499 294,713 259,644Protein Group$814,174$845,312$3,298,157$3,299,104Bakery Products Group 390,603 400,016 1,566,622 1,594,520Sales$1,204,777$1,245,328$4,864,779$4,893,624Following is a summary of Adjusted Operating Earnings by business segment:          Fourth QuarterYear-to-Date(Unaudited)(Audited)($ thousands)2012201120122011Meat Products Group$48,133 $27,472$121,272 $95,987Agribusiness Group 12,660 14,744 68,436 81,895Protein Group$60,793 $42,216$189,708 $177,882Bakery Products Group 31,410 16,129 97,634 86,294Non-allocated Costs in Adjusted Operating Earnings(i) (901) (898) (7,305) (5,160)Adjusted Operating Earnings$91,302 $57,447$280,037 $259,016(i)     Non-allocated costs comprise expenses not separately identifiable to business segment groups, and do not form part of the measures used by the Company when assessing the segments' operating results.    Protein GroupSales for the Protein Group, which includes the Company's Meat Products Group and Agribusiness Group, declined 3.7% to $814.2 million in the fourth quarter of 2012 from $845.3 million last year. For the full year, sales for the Protein Group of $3,298.2 million were consistent with $3,299.1 million last year. Adjusted Operating Earnings increased 44.0% to $60.8 million in the fourth quarter, compared to $42.2 million last year. For the full year, Adjusted Operating Earnings increased 6.6% to $189.7 million, compared to $177.9 million last year. Results for the Company's Meat Products Group and Agribusiness Group should be viewed in combination due to intercompany transactions and correlated factors within these operations.Meat Products GroupIncludes value-added prepared meats, lunch kits; and fresh pork, poultry and turkey products sold to retail, foodservice, industrial and convenience channels. Includes leading Canadian brands such as Maple Leaf ®, Schneiders ® and many leading sub-brands.Meat Products Group sales for the fourth quarter declined 5.3% to $740.8 million from $781.8 million in the fourth quarter last year. After adjusting for the impact of a stronger Canadian dollar, which decreased the sales value of pork exports, sales declined 4.6%, primarily due to discontinuance of lower-margin accounts in the prepared meats business.Adjusted Operating Earnings for the fourth quarter increased 75.2% to $48.1 million, compared to $27.5 million last year, driven by stronger earnings growth in the prepared meats and fresh poultry businesses, which was partly offset by lower earnings in the primary pork processing operations. The prepared meats business benefited from price increases to manage higher input costs, an improved sales mix driven by higher margin product innovation and the discontinuance of lower-margin foodservice business. Other positive effects impacting earnings for the quarter included cost reductions from simplification of the Company's product portfolio and $5.9 million in provisions related to re-assessments of environmental remediation costs on facilities planned for closure.  These benefits were partly offset by lower volumes.Sales of higher value products, such as the Maple Leaf Prime chicken brand, combined with improved sales mix in higher value channels contributed to higher earnings in the fresh poultry operations. Earnings in primary pork processing declined from last year due to continued weaker industry margins, although improved from earlier in the year.For the full year, Adjusted Operating Earnings in the Meat Products Group increased 26.3% to $121.3 million compared to $96.0 million last year, largely driven by the same factors noted in the quarter.Agribusiness GroupConsists of Canadian hog production and animal by-product recycling operations, including biodiesel manufacturing and distribution.Sales in the Agribusiness Group increased 15.6% to $73.4 million for the fourth quarter compared to $63.5 million last year, as higher volumes in biodiesel and rendering operations were partly offset by lower biodiesel selling prices.Adjusted Operating Earnings in the fourth quarter declined 14.1% to $12.7 million compared to $14.7 million last year.  Hog production earnings were impacted by a combination of higher feed costs and lower market prices for hogs.  Earnings in the by-products recycling operations were impacted by higher payments for raw materials and lower biodiesel selling prices, partly offset by stronger export volumes.Adjusted Operating Earnings for the year declined 16.4% to $68.4 million compared to $81.9 million last year, as a result of lower results in both hog production and by-product recycling operations.Bakery Products GroupIncludes fresh and frozen bakery products, including breads, rolls, bagels, specialty and artisan breads, sweet goods, and fresh pasta and sauces sold to retail, foodservice and convenience channels. It includes national brands such as Dempster's®, Tenderflake®, Olivieri® and New York Bakery CoTM, and many leading regional brands.Bakery Products Group sales for the fourth quarter declined 2.4% to $390.6 million compared to $400.0 million last year. After adjusting for the closure of a bakery in the U.K. and currency translation on sales in the U.S. and U.K., sales were consistent with the prior year.  Higher volumes in the North American and U.K. frozen bakery businesses were offset by lower volumes and unfavourable sales mix in the fresh pasta operations. Fresh bakery volumes were consistent with the last year.Adjusted Operating Earnings for the fourth quarter increased to $31.4 million from $16.1 million last year.  Earnings growth in the fresh bakery and North American frozen bakery businesses was partly offset by lower earnings in the fresh pasta business, while earnings in the U.K. bakery operations were consistent with prior year.The Company benefited from efficiency gains resulting from the closure of its bakery in Delta, British Columbia, in late 2011 and the transfer of production to more efficient bakeries, and from reduced input costs as a result of positive hedging activities. In the fourth quarter of 2011, the Company was impacted by higher costs resulting from its SAP installation in Western Canada that were not repeated in 2012. Higher duplicative overhead costs were incurred last year as the Company continued to operate three bakeries while transferring production to a new, more efficient bakery in Hamilton, Ontario.  During 2012, two of these facilities were closed, with associated reduction in costs.  The closure of the third Ontario bakery is planned for the second quarter of 2013.Adjusted Operating Earnings for the full year increased 13.1% to $97.6 million compared to $86.3 million last year, as the earnings improvements in the fresh bakery, North American frozen bakery and U.K. bakery businesses were partly offset by lower earnings in the fresh pasta business.Subsequent EventsOn January 4, 2013, the Company sold its potato processing product facility and related assets in Lethbridge, Alberta to Cavendish Farms Corporation for proceeds of $57.8 million, resulting in a pre-tax gain of approximately $44.5 million.On January 30, 2013, the Company announced plans to close a bakery in Grand Falls, New Brunswick and a bakery in Edmonton, Alberta in the first half of 2013.  The Company expects to incur approximately $6.3 million before tax in restructuring costs, of which approximately $4.2 million are cash costs.Other MattersOn February 25, 2013, Maple Leaf Foods declared a dividend of $0.04 per share payable March 28, 2013 to shareholders of record at the close of business March 8, 2013. Unless indicated otherwise by the Company in writing on or before the time the dividend is paid, the dividend will be considered an Eligible Dividend for the purposes of the "Enhanced Dividend Tax Credit System".An investor presentation related to the Company's fourth quarter financial results is available at www.mapleleaffoods.com and can be found under Investor Relations on the Quarterly Results page. A conference call will be held at 2:30 p.m. EDT on February 26, 2013 to review Maple Leaf Foods' fourth quarter financial results. To participate in the call, please dial 416-340-8018 or 866-223-7781. For those unable to participate, playback will be made available an hour after the event at 905-694-9451 / 800-408-3053 (Passcode 9670637).A webcast presentation of the fourth quarter financial results will also be available at http://investor.mapleleaf.ca via a link: http://www.media-server.com/m/p/hub8k8pe.The Company's full financial statements and related Management's Discussion and Analysis are available for download on the Company's website.Reconciliation of Non-IFRS Financial MeasuresThe Company uses the following non-IFRS measures: Adjusted Operating Earnings and Adjusted Earnings per Share.  Management believes that these non-IFRS measures provide useful information to both Management and investors in measuring the financial performance of the Company for the reasons outlined below.  These measures do not have a standardized meaning prescribed by IFRS, and therefore they may not be comparable to similarly titled measures presented by other publicly traded companies and should not be construed as an alternative to other financial measures determined in accordance with IFRS.Adjusted Operating EarningsAdjusted Operating Earnings, a non-IFRS measure, is used by Management to evaluate financial operating results.  It is defined as earnings before income taxes adjusted for items that are not considered representative of on-going operational activities of the business, and items where the economic impact of the transactions will be reflected in earnings infuture periods when the underlying asset is sold or transferred.  The table below provides a reconciliation of net earnings as reported under IFRS in the audited consolidated statements of earnings for the three months and twelve months then ended to Adjusted Operating Earnings.  Management believes that this basis is the most appropriate on which to evaluate operating results, as they are representative of the on-going operations of the Company.             Three months ended December 31, 2012  Meat   Bakery    (Unaudited) Products Agribusiness Products Unallocated  ($ thousands) Group Group Group costs ConsolidatedNet earnings         $56,844 Income taxes         20,080 Earnings from operations before income taxes         $76,924 Interest expense         17,187 Change in the fair value of non-designated   interest rate swaps         (117)Other (income) expense 673  (4,296) (277) (481) (4,381)Restructuring and other related costs 8,982  -  3,814  -  12,796 Earnings from Operations $48,133  $12,660  $  31,410  $10,206  $102,409 Increase in fair value of biological assets -  -  -  (10,703) (10,703)Unrealized gains on commodity futures contracts -  -  -  (404) (404)Adjusted Operating Earnings $48,133  $12,660  $  31,410  $(901) $91,302                  Three months ended December 31, 2011 Meat Bakery  (Unaudited)ProductsAgribusinessProductsUnallocated ($ thousands)GroupGroupGroupcostsConsolidatedNet earnings         $9,195Income taxes         7,410Earnings from operations before income taxes         $16,605Interest expense         17,795Change in the fair value of non-designated   interest rate swaps         (422)Other (income) expense (4,459) (215) (50) (381) (5,105)Restructuring and other related costs 18,835 - 12,161 1,197 32,193Earnings from Operations $27,472 $14,744 $16,129 $2,721 $61,066Increase in fair value of biological assets - - - (67) (67)Unrealized gains on commodity futures contracts - - - (3,552) (3,552)Adjusted Operating Earnings $27,472 $14,744 $16,129 $(898) $57,447   Twelve months ended December 31, 2012(Audited) ($ thousands)Meat Products GroupAgribusiness GroupBakery Products GroupUnallocated costsConsolidatedNet earnings    $ 122,714Income taxes    47,889      Earnings from operations before income taxes    $ 170,603Interest expense    71,685Change in the fair value of non-designatedinterest rate swaps    (7,297)Other (income) expense(2,323)(4,885)(1,635)(388)(9,231)Restructuring and other related costs36,438-  11,073-  47,511Earnings from Operations$ 121,272$ 68,436$ 97,634$ (14,071)$ 273,271Decrease in fair value ofbiological assets-  -  -  3,4363,436Unrealized losses on commodityfutures contracts-  -  -  3,3303,330Adjusted Operating Earnings$ 121,272$ 68,436$ 97,634$ (7,305)$ 280,037             Twelve months ended December 31, 2011(Audited) ($ thousands)Meat Products GroupAgribusiness GroupBakery Products GroupUnallocated costsConsolidated      Net earnings    $ 87,331Income taxes    24,469      Earnings from operations before income taxes    $ 111,800Interest expense    70,747Change in the fair value of non-designatedinterest rate swaps    10,960Other (income) expense(8,547)(958)(414)(413)(10,332)Restructuring and other related costs31,130                  -46,3562,30979,795Earnings from Operations$ 95,987$ 81,895$ 86,294$ (1,206)$ 262,970Decrease in fair value of biological assets- - - 1,0271,027Unrealized gains on commodity futurescontracts- - - (4,981)(4,981)Adjusted Operating Earnings$ 95,987$ 81,895$ 86,294$ (5,160)$ 259,016 Adjusted Earnings per ShareAdjusted Earnings per Share, a non-IFRS measure, is used by Management to evaluate on-going financial operating results.  It is defined as basic earnings per share attributable to common shareholders, and is adjusted for items that are not considered representative of on-going operational activities of the business, and items where the economic impact of the transactions will be reflected in earnings in future periods when the underlying asset is sold or transferred.  The table below provides a reconciliation of basic earnings per share as reported under IFRS in the audited consolidated statements of earnings for the three months and twelve months then ended to Adjusted Earnings per Share. Management believes this basis is the most appropriate on which to evaluate financial results as they are representative of the on-going operations of the Company.            Three months endedTwelve months ended  December 31,December 31,   (Unaudited) (Audited)($ per share)  2012 2011 2012 2011Basic earnings per share  $0.39  $0.06 $0.83  $0.59Restructuring and other related costs(i)  0.07  0.17 0.25  0.41Non-operational gains, net of legal fees(ii)  (0.02) - (0.02) (0.02)Change in the fair value of non-designated interest rate swaps(iii)   -  - (0.04) 0.06Change in the fair value of unrealized (gains) losses on commodity          futures contracts(iii)  -  (0.02) 0.02  (0.03)Change in the fair value of biological assets(iii)  (0.06) - 0.02  0.01Adjusted Earnings per Share(iv)  $0.38  $0.21 $1.06  $1.01         (i)     Includes per share impact of restructuring and other related costs, net of tax and non-controlling interest.(ii)     Gains associated with non-operational activities, including gains related to restructuring activities and on business combinations, and associated legal fees are net of tax.(iii)     Includes per share impact of the change in fair value of non-designated interest rate swaps, hedge ineffectiveness recognized in earnings, unrealized (gains) losses on commodity futures contracts and the change in fair value of biological assets, net of tax.(iv)     May not add due to rounding.Forward-Looking StatementsThis document contains, and the Company's oral and written public communications often contain, "forward-looking information" within the meaning of applicable securities law.  These statements are based on current expectations, estimates, forecasts and projections about the industries in which the Company operates and beliefs and assumptions made by the Management of the Company. Such statements include, but are not limited to, statements with respect to objectives and goals, as well as statements with respect to beliefs, plans, objectives, expectations, anticipations, estimates and intentions. Specific forward-looking information in this document includes, but is not limited to, statements with respect to the anticipated benefits, timing, actions, costs and investments associated with the Company's Value Creation Plan, expectations regarding Net Debt to EBITDA ratios during the implementation of the Plan, expectations regarding the use of derivatives, futures and options,  expectations regarding  improving efficiencies, the expected use of cash balances, source of funds for ongoing business requirements including renewal of existing securitization facilities, capital investments and debt repayment, expectations regarding acquisitions and divestitures, the timing of new plant openings and old plant closures, job losses and LEED® certification, expectations regarding the impact of new accounting standards, expectations regarding sufficiency of the allowance for uncollectible accounts and expectations regarding pension plan performance and future pension plan liabilities and contributions. Words such as "expect", "anticipate", "intend", "attempt", "may", "will", "plan", "believe", "seek", "estimate", and variations of such words and similar expressions are intended to identify such forward-looking information. These statements are not guarantees of future performance and involve assumptions and risks and uncertainties that are difficult to predict.In addition, these statements and expectations concerning the performance of the Company's business in general are based on a number of factors and assumptions including, but not limited to: the condition of the Canadian, U.S., U.K. and Japanese economies; the rate of exchange of the Canadian dollar to the U.S. dollar, U.K. British pound and the Japanese yen;  the availability and prices of raw materials, energy and supplies; product pricing; the availability of insurance; the competitive environment and related market conditions; improvement of operating efficiencies whether as a result of the Value Creation Plan or otherwise; continued access to capital; the cost of compliance with environmental and health standards; no adverse results from ongoing litigation; no unexpected actions of domestic and foreign governments; and the general assumption that none of the risks identified below or elsewhere in this document will materialize.  All of these assumptions have been derived from information currently available to the Company including information obtained by the Company from third-party sources. These assumptions may prove to be incorrect in whole or in part.  In addition, actual results may differ materially from those expressed, implied or forecasted in such forward-looking information, which reflect the Company's expectations only as of the date hereof.Factors that could cause actual results or outcomes to differ materially from the results expressed, implied or forecasted by forward-looking information is discussed more fully in the Company's Annual Management's Discussion and Analysis for the period ended December 31, 2012 including the section entitled "Risk Factors", that are updated each quarter in the Management's Discussion and Analysis, and are available on SEDAR at www.sedar.com. The Company does not intend to, and the Company disclaims any obligation to, update any forward-looking information, whether written or oral, or whether as a result of new information, future events or otherwise except as required by law.Maple Leaf Foods Inc. ("Maple Leaf" or the "Company") is a leading Canadian value-added meat, meals and bakery company committed to delivering quality food products to consumers around the world. Headquartered in Toronto, Canada, the Company employs approximately 20,000 people at its operations across Canada and in the United States, Europe and Asia.Consolidated Financial Statements(Expressed in Canadian dollars)MAPLE LEAF FOODS INC.Three and twelve months ended December 31, 2012 and 2011MAPLE LEAF FOODS INC.Consolidated Balance Sheets(In thousands of Canadian dollars)         As at  As at  December 31,  December 31,  2012  2011      ASSETS           Current assets      Cash and cash equivalents$90,414  $- Accounts receivable 116,503   133,504 Notes receivable 125,487   98,545 Inventories 301,804   293,231 Biological assets 78,127   49,265 Income taxes recoverable 41,527   43,789 Prepaid expenses and other assets 12,590   24,688 Assets held for sale 37,087   -  $803,539    $643,022       Property and equipment 1,212,177   1,067,246 Investment property 11,979   11,232 Employee benefits 107,831   133,942 Other long-term assets  13,663   11,926 Deferred tax asset 132,558   127,456 Goodwill 753,156   753,739 Intangible assets 208,793   191,896 Total assets$3,243,696  $2,940,459      LIABILITIES AND EQUITY           Current liabilities      Bank indebtedness$48,243   $36,404 Accounts payable and accruals 446,911   482,059 Provisions 26,335   44,255 Current portion of long-term debt 6,573   5,618 Other current liabilities 14,961   20,409 $543,023   $ 588,745       Long-term debt 1,206,945   941,956 Employee benefits 420,933   350,853 Provisions 25,800   28,936 Other long-term liabilities 80,084   88,153 Deferred tax liability  8,912   11,703 Total liabilities $2,285,697  $2,010,346        Shareholders' equity       Share capital$902,810    $902,810Deficit (72,701)  (78,674)Contributed surplus 75,913   64,327Accumulated other comprehensive loss (13,263)  (17,042)Treasury stock (1,845)  (6,347)Total shareholders' equity $890,914    $865,074Non-controlling interest 67,085   65,039Total equity$957,999    $930,113Total liabilities and equity$3,243,696    $2,940,459 MAPLE LEAF FOODS INC.Consolidated Statements of Earnings(In thousands of Canadian dollars, except share amounts)             Three months ended Twelve months ended December 31, December 31,  2012  2011  2012  2011  (Unaudited)  (Unaudited)                  Sales$1,204,777  $1,245,328 $4,864,779  $4,893,624            Cost of goods sold 994,074   1,058,687  4,096,794   4,126,460            Gross margin$210,703  $186,641 $767,985  $767,164            Selling, general and administrative expenses 108,294  125,575  494,714   504,194                        Earnings before the following:$102,409  $61,066 $273,271  $262,970            Restructuring and other related costs (12,796)  (32,193)  (47,511)  (79,795)Change in fair value of non-designated   interest rate swaps 117   422  7,297   (10,960)Other income (expense) 4,381   5,105  9,231   10,332            Earnings before interest and income taxes$94,111  $34,400 $242,288  $182,547Interest expense 17,187   17,795  71,685   70,747            Earnings before income taxes$76,924  $16,605 $170,603  $111,800Income taxes 20,080   7,410  47,889   24,469            Net earnings$56,844  $9,195 $122,714  $87,331            Attributed to:                       Common shareholders$54,609  $8,426 $115,296  $82,134Non-controlling interest 2,235   769  7,418   5,197             $56,844  $9,195 $122,714  $87,331            Earnings per share attributable to   common shareholders           Basic earnings per share$0.39  $0.06 $0.83  $0.59Diluted earnings per share$0.38  $0.06 $0.81  $0.58                        Weighted average number of shares (millions) 139.3   138.1  139.4   138.7             MAPLE LEAF FOODS INC.Consolidated Statements of Comprehensive Income (Loss)(In thousands of Canadian dollars)                 Three months ended Twelve months ended   December 31, December 31,    2012  2011 2012  2011    (Unaudited)  (Unaudited)     Net earnings  $56,844 $9,195$122,714 $87,331                          Other comprehensive income (loss)             Change in accumulated foreign currency translation adjustment  $1,972 $(4,434)$(1,730) $5,651 Change in unrealized gains and losseson cash flow hedges   (1,061)  5,154 5,251  282 Change in asset ceiling and minimum funding requirements   -   12,680 -  12,680 Change in actuarial gains and losses   723  6,127 (87,743)  (128,832)   $1,634 $19,527$(84,222) $(110,219)             Comprehensive income (loss)    $58,478 $28,722$38,492  $(22,888)             Attributed to:                         Common shareholders  $55,773 $28,619$31,981 $(26,979)Non-controlling interest   2,705   103 6,511  4,091              MAPLE LEAF FOODS INC.Consolidated Statements of Changes in Total Equity(In thousands of Canadian dollars)                      Attributable to Common Shareholders                 Total                    accumulated                    other     Non-     Share     Contributed  comprehensive  Treasury  controlling  Total  capital  Deficit  surplus  loss  stock  interest  equity                     Balance at December 31, 2011$902,810 $(78,674) $64,327   $(17,042)  $(6,347)  $65,039   $930,113                       Net earnings  -  115,296   -   -   -   7,418   122,714  Other comprehensive income (loss) -  (87,094)  -   3,779   -   (907)  (84,222) Dividends declared   ($0.16 per share) -  (22,229)  -   -   -   (4,473)  (26,702) Stock-based compensation expense -  -   24,711   -   -   -   24,711  Issue of stock from treasury -  -   (13,525)  -   13,525   -   -  Repurchase of treasury stock -  -   -   -   (9,023)  -   (9,023) Acquisition of business -  -   -   -   -   (82)  (82) Other -  -   400   -   -   90   490Balance at December 31, 2012 $902,810 $(72,701)  $75,913   $(13,263)  $(1,845)  $67,085   $957,999                                                                 Attributable to Common Shareholders                Total                    accumulated                    other     Non-     Share     Contributed  comprehensive  Treasury  controlling  Total  capital  Deficit  surplus  loss  stock  interest  equity                                          Balance at December 31, 2010$902,810 $(5,267) $59,002 $(22,585) $(10,078) $62,890 $986,772                      Net earnings -  82,134  -  -  -  5,197  87,331 Other comprehensive income (loss) -  (114,656)  -  5,543  -  (1,106)  (110,219) Dividends declared   ($0.16 per share) -  (22,386)  -  -  -  (1,830)  (24,216) Stock-based compensation expense -  -  19,393  -  -  -  19,393 Issue of stock from treasury -  (18,499)  (14,068)  -  32,567  -  - Repurchase of treasury stock -  -  -  -  (28,836)  -  (28,836) Decrease in minority interest -  -  -  -  -  (112)  (112)Balance at December 31, 2011$902,810 $(78,674) $64,327 $(17,042) $(6,347) $65,039 $930,113                      MAPLE LEAF FOODS INC.Consolidated Statements of Cash Flows(In thousands of Canadian dollars)                Three months ended Twelve months ended  December 31, December 31,   2012  2011  2012  2011             CASH PROVIDED BY (USED IN):  (Unaudited)  (Unaudited)                   Operating activities             Net earnings  $56,844   $9,195 $  122,714   $87,331 Add (deduct) items not affecting cash:              Change in fair value of biological assets  (10,703)  (67)  3,436   1,027  Depreciation and amortization  35,093   28,368  132,739   125,990  Stock-based compensation  8,482   6,575  24,711   19,393  Deferred income taxes  12,945   (6,050)  18,967   5,896  Income tax current  7,135   13,460  28,922   18,573  Interest expense  17,187   17,795  71,685   70,747  Gain on sale of long-term assets  (203)  (3,221)  (624)  (6,987)  Gain on disposal of assets held for sale  -   (571)  (459)  (571)  Gain on business combination  (5,330)  -  (5,330)  -  Change in fair value of non-designated                 interest rate swaps  (117)  (423)  (7,297)  10,959  Change in fair value of derivative financial   instruments  (196)  (6,756)  3,107   (3,924) Increase (decrease) in net pension liability  (13,589)  6,545  (21,870)  10,364 Net income taxes paid  (5,349)  1,096  (21,861)  (17,703) Interest paid  (16,473)  (21,381)  (69,896)  (57,969) Change in provision for restructuring and   other related costs  7,120   22,925  13,179   43,563 Other  (2,038)  (2,255)  (9,427)  (5,969) Change in non-cash operating working capital  (24,383)  13,644  (64,616)  (55,886)Cash provided by operating activities  $66,425  $78,879 $  218,080  $  244,834             Financing activities             Dividends paid  $(5,639) $(5,470) $(22,229) $(22,386) Dividends paid to non-controlling interest  (1,270)  (508)  (3,710)  (1,830) Net increase (decrease) in long-term debt  83,410   (26,846)  272,546   5,195 Increase in financing costs  -   (214)  -   (6,610) Purchase of treasury stock  -   -  (9,023)  (28,836) Other   (352)  (366)  (1,619)  (1,512)Cash provided by (used in) financing activities $76,149  $(33,404) $  235,965  $ (55,979)             Investing activities             Additions to long-lived assets $(108,723) $(68,588) $(306,334)  $(229,171) Acquisition of business  (46,560)  -  (77,690)  - Capitalization of interest expense  (2,771)  (1,109)  (6,901)  (5,600) Proceeds from sale of long-term assets  1,630   5,524  7,481   24,267 Proceeds from sale of assets held for sale  -   -  7,974   - Other  -   23  -   1,103Cash used in investing activities $(156,424)  $(64,150) $(375,470) $(209,401)             Increase (decrease) in cash and cash equivalents $(13,850) $(18,675) $78,575   $(20,546)Net cash and cash equivalents, beginning of period  56,021   (17,729)  (36,404)  (15,858)Net cash and cash equivalents, end of period $42,171   $(36,404)  $42,171   $(36,404)             Net cash and cash equivalents is comprised of:                         Cash and cash equivalents  $90,414  $- $90,414  $-Bank indebtedness  (48,243)  (36,404)  (48,243)  (36,404)             Net cash and cash equivalents, end of period  $42,171   $(36,404) $42,171   $(36,404)               MAPLE LEAF FOODS INC.Segmented Financial Information(In thousands of Canadian dollars)      Three months ended Twelve months ended December 31,December 31,  2012  2011 2012  2011  (Unaudited)  (Unaudited)     Sales           Meat Products Group$740,764  $781,813$  3,003,444  $  3,039,460 Agribusiness Group 73,410   63,499 294,713   259,644 Bakery Products Group 390,603   400,016 1,566,622   1,594,520 $1,204,777  $1,245,328$4,864,779  $4,893,624           Earnings before restructuring andother related costs and other income           Meat Products Group$48,133  $27,472$121,272  $95,987 Agribusiness Group 12,660   14,744 68,436   81,895 Bakery Products Group 31,410   16,129 97,634   86,294 Non-allocated costs 10,206   2,721 (14,071)  (1,206)  $102,409   $61,066 $ 273,271   $262,970            Capital expenditures           Meat Products Group$85,951  $32,491 $234,663  $84,437 Agribusiness Group 7,424   8,400 16,361   17,108 Bakery Products Group 15,348   27,697 55,310   127,626 $108,723  $68,588$306,334  $229,171           Depreciation and amortization           Meat Products Group$16,431  $10,286$61,260  $57,702 Agribusiness Group 4,031   4,473 15,980   16,126 Bakery Products Group 14,631   13,609 55,499   52,162 $35,093  $28,368$132,739  $125,990                                        As at  As at        December 31,  December 31,        2012  2011            Total assets           Meat Products Group      $1,617,413  $1,465,576 Agribusiness Group      275,167   223,013 Bakery Products Group      1,005,432   937,292 Non-allocated assets      345,684   314,578      $3,243,696  $2,940,459           Goodwill           Meat Products Group     $442,925  $442,336 Agribusiness Group      13,845   13,845 Bakery Products Group      296,386   297,558      $753,156  $753,739            SOURCE: Maple Leaf Foods Inc.For further information: Investor Contact: Nick Boland, VP Investor Relations: 416-926-2005 Media Contact: 416-926-2020