Canada’s Maple Leaf Foods has upped its full-year EBITDA guidance ahead of the separation of its pork unit into a standalone publicly listed entity.
Pork sales led an 8.5% increase in Maple Leaf Foods’ second-quarter group revenue growth, which was accompanied by a 28.9% gain in adjusted EBITDA to C$182m ($132.5m).
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President and CEO Curtis Frank said the inroads in sales and profit were “fuelled by improved profitability in the pork complex and profitable growth in our brand-led consumer packaged goods business”.
After what Frank described as a “strong first half”, Maple Leaf Foods has raised the adjusted EBITDA guidance to a range of C$680-700m, compared to a prior forecast of C$634m “or greater”.
Maple Leaf Foods announced the planned spin-off of its pork business last summer. It will be known as Canada Packers once the transaction is completed, which is still expected sometime in the back half of this year.
The split was approved by the company’s shareholders in June.
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By GlobalDataOnce initiated, the new Maple Leaf Foods will operate two business segments: prepared foods, including other meat categories and the alternative-protein brands Field Roast and Lightlife; and poultry.
“This historic transaction will unlock significant shareholder value and establish two focused, market-leading companies,” Frank said in the results commentary. “We remain firmly on track to complete the transaction in the second half of the year, delivering long-term value for all our stakeholders.”
Maple Leaf Foods reported group revenue of C$1.36bn in the three months to 30 June but did not break down the sales values by category as it has in the past.
However, sales of pork products rose 10.7% in the quarter, ahead of increases of 7.5% and 8.5%, respectively, for prepared foods and poultry.
Alongside the increase in adjusted EBITDA, the associated profit margin climbed 210 basis points to 13.3%.
The net bottom-line result turned positive to the tune of C$57.8m, compared to a C$26.2m net loss a year earlier.
Basis earnings per share came in at 47 Canadian cents, a turnaround from the 21-cent loss in the corresponding period.
Adjusted EPS more than tripled to 56 cents.
Maple Leaf Foods said the adjusted EBITDA outlook includes the pork operations for now but warned of the potential impact from uncertainties, including US tariffs.
“Evolving macro-economic factors continue to influence the operating environment. These factors may have an impact on consumer sentiment, supply chain activity, access to markets, barriers to trade, markets and foreign- exchange rates,” the company said.
“At the same time, it recognises that its ability to deliver its 2025 guidance could be impacted by these conditions, including the impact of tariffs between Canada and the US. The company is continuing to closely monitor the evolving tariff landscape so that it is prepared to adapt quickly as circumstances change.”
