Maple Leaf Foods ended 2005 disappointingly after a promising first three quarters and blamed high energy costs and losses in the Japanese market for its fourth quarter sales slump.
Full year sales for the Canadian food processor increased 2% to reach CAD$6.5bn – aided by sales from newly acquired Schneider Foods and an increase in fresh bakery sales.
Fourth quarter sales decreased 10% to $1.6bn, compared with $1.8bn for the same period in 2004. The slump was put down to lower commodity prices affecting the company’s pork, poultry, feed and rendering businesses, and lower sales to Japan.
Maple Leaf president and CEO Michael McCain said: “We had a year of many extraordinary accomplishments, achieving strong financial results in the first three quarters despite underlying commodity challenges.
“However, we ended the year on a disappointing note, as our growth engines in the consumer products and fresh bakery businesses were impacted by high energy and related inflationary costs. A downturn in the performance of our Japanese pork business, mostly driven by a rapid decline in the Japanese currency, compounded the earnings decline in the quarter, overshadowing the significant improvements we made throughout the year in our fresh pork operations.”