Maple Leaf Foods reported an increase in sales and net earnings for the third quarter of fiscal year 2020, which ended September 30.
The Canadian company reported its financial results for the quarter on October 27..
Sales for third quarter
Sales for the third quarter of 2020 were CA$1.06 billion (US$802.2 million) compared to CA$995.8 million for the same period last year, an increase of 6.2%. The increase was driven by both the Meat and Plant Protein Groups.
The Meat Protein Group’s sales growth is attributable primarily to increased demand in the retail channel in North America which more than offset lower volumes in foodservice. Meat Protein Group sales also benefited from strong growth in sustainable meats, exports to Asian markets and the positive impact of foreign currency translation.
The Plant Protein Group’s sales growth of 9.3% reflects investments in new products in rapidly expanding categories.
Net earnings for third quarter
Net earnings for the third quarter of 2020 were CA$66.0 million ($0.54 per basic share) compared to CA$13.4 million ($0.11 per basic share) last year.
Strong commercial performance in the Meat Protein Group more than offset costs to mitigate COVID-19 risks, strategic investment in the Plant Protein Group, as well as a favorable resolution of an income tax audit last year. Results were also impacted by a higher gain from non-cash fair value changes in biological assets and derivative contracts, which are excluded in the calculation of Adjusted Operating Earnings below.
"Maple Leaf continues to deliver on its responsibility as an essential service, its commitment to protect employees, and its support of local communities during these extraordinary times," Michael H. McCain, the company's president and CEO, said in a press release. "I continue to be amazed and humbled by the steadfastness of our team and their ability to maintain critical infrastructure in the face of extremely challenging circumstances.
"Our operational resiliency, strong brands, and the success of our sustainable meat strategy delivered excellent results in Meat Protein in the third quarter. While supply chain disruptions impacted short-term Plant Protein performance, we are seeing strong underlying consumer demand, we have implemented inspiring new brand strategies, and we are incredibly excited about the long-term prospects of this business. We have built significant growth engines at Maple Leaf Foods."