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A Maple Leaf Foods employee walks through the company's meat facility in Toronto on Dec. 15, 2008.NATHAN DENETTE/The Canadian Press

Maple Leaf Foods Inc. overcame a steep drop in restaurant and food supply sales last quarter to furnish a $25-million profit thanks to a revenue boost in pork, retail consumption and Asian demand.

The meat giant raised sales by 7 per cent $1.09 billion in the second quarter as consumers of its pork and plant-based protein products stayed home and stocked up, on top of more exports to China.

“The strength of retail volumes was fully offset by the decline in food service,” said chief financial officer Geert Verellen. But an overall increase in demand and production of pork – yielding meat sales growth of 5.8 per cent – alongside 41 per cent sales growth for plant-based protein shored up income.

“There is a steady slope of recovery in food service, but we’re clearly a ways away from coming anywhere close to being flat to a year ago,” chief operating officer Curtis Frank said on a conference call Thursday.

Plant-based protein, which includes grain-based protein and vegan cheese products, has made up a rapidly growing portion of revenue for the past year, but still comprises less than 6 per cent of total sales.

Maple Leaf said it shelled out $19-million on COVID-19 costs such as personal protective equipment and sanitation protocols, mitigated by savings on travel, training and promotions.

The bulk of pandemic expenses related to the $2 hourly bonus paid to processing-plant workers from late March through June, the company said.

Maple Leaf announced it would nix the so-called hero pay late last month, prompting some backlash from the union representing front-line employees.

“We were disappointed with the decision that was made not just by Maple Leaf Foods but also by other food industry employers,” said Tim Deelstra, a spokesman for the United Food and Commercial Workers Canada.

Grocery chains Loblaw Cos. Ltd., Metro Inc. and Empire Co. – the parent company of Sobeys and Safeway – ended the wage bonus in mid-June.

“The pandemic is still there. The virus has not gone away. There is no vaccine,” Mr. Deelstra said Thursday. “Workers continue to be concerned and want to be as healthy and safe as they can be.”

Chief executive Michael McCain said the company continues to drive down costs “without sacrificing the health and safety of our people,” and expressed his “profound gratitude to our front-line team members.”

Maple Leaf earned $25.7-million in the quarter ended June 30 on higher revenues led by a 41-per-cent gain from its plant protein group.

The company says its net income amounted to 21 cents a share for the three-month period, compared with a loss of five cents a share or $6.3-million a year earlier.

Adjusted profits were 35 cents a share, up 6 per cent from 33 cents a share in the second quarter of 2019 as stronger sales were largely offset by the COVID-19 costs and strategic investments in plant protein.

Maple Leaf Foods was expected to report 25 cents per share in adjusted profits on $1.12-billion in revenues, according to financial markets data firm Refinitiv.

The company’s shares increased $1.42 or 5.1 per cent at $29.15 in midday trading on the Toronto Stock Exchange.

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This content appears as provided to The Globe by the originating wire service. It has not been edited by Globe staff.

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