Dairy food producer Saputo Inc. is reporting a slightly improved profit in its latest quarter on a modest drop in revenue, missing analysts' expectations.
The Quebec-based company says it earned net income of $129.7-million, or 65 cents per diluted share, in its fiscal second-quarter, compared with $127.1-million, or 61 cents, in the year-earlier period.
Revenue slipped to $1.75-billion from $1.79-billion year over year.
Adjusted earnings were the same for both periods.
Saputo was expected to report adjusted earnings per share of 66 cents on $1.8-billion of revenue in the quarter, according to estimates compiled by Thomson Reuters.
The company noted that in the U.S., the average block market per pound of cheese – the average daily price of a 40-pound block of cheddar on the Chicago Mercantile Exchange – decreased by 26 cents U.S. compared to the same period last fiscal year, negatively affecting revenue.
Saputo's dairy products division also faced lower sales volumes and selling prices, mainly in the export market.
It did note, however, that the weakening of the loonie versus the U.S. dollar during the quarter had a positive impact on revenues and EBITDA, or earnings before interest, taxes, depreciation and amortization.
The Montreal-based company recently announced that the Saputo family company, Jolina Capital Inc., sold 3.1 million shares for $129.3-million in gross proceeds as part of a secondary offering.
Saputo is the world's 12th-largest dairy processor, and Canada's largest with more than 10,200 employees.
It produces, markets and distributes cheese, milk, yogurt and dairy products at 47 plants in Canada, the U.S., Europe and Argentina. It is also Canada's largest snack cake producer.