Canadian food processor Maple Leaf Foods has posted net earnings for the third quarter before restructuring and other costs and non-recurring tax adjustments of C$11.8m (US$10.5m), or $0.09 per share, down from $30.1m ($0.24 per share) last year.

Year-to-date net earnings, before restructuring and other costs and non-recurring tax adjustments, were $50.3m ($0.39 per share), against nine-month net earnings for 2005, not including restructuring costs, of $84.4m ($0.67 per share). Including restructuring and other costs and non-recurring tax adjustments, the company said it recorded a net loss of $22.3m (loss of $0.17 per share) and year-to-date net earnings of $16.1m ($0.13 per share).

Maple Leaf, which in October announced a major shift in strategy and reorganisation of its protein value chain operations in a bid to boost long-term profitability, posted a 5% drop in third-quarter sales to $1.5bn, which primarily reflected lower prices in export markets due to currency changes. Sales for the nine-month period also fell by 5% to $4.4bn.

"Our performance in the third quarter clearly does not reflect the potential of this company and reaffirms our decision to move forward with major changes in our protein value chain," said president and CEO Michael McCain. "We will significantly improve long-term profitability, and reduce our exposure to currency and commodity markets, through reorganising these operations to focus growth in the higher margin, value-added meats and meals business."

McCain added that while the company's bakery group had achieved significant top-line growth in the quarter, profitability had been negatively impacted by record high flour prices and other short-term factors. "We are implementing price increases to offset these higher costs, and we will continue to benefit from the brand and market leadership we have built in this business," McCain said.

Meat Products Group sales for the third quarter decreased by 9% to $926m, primarily due to a currency related decline in the value of export sales. Year-to-date sales were $2.8bn compared to $3.1bn last year.
Earnings from these operations for the third quarter declined to $9.2m from $13.3m last year, while year-to-date earnings were $36.6m compared to $49.5m last year.

In the company's Agribusiness Group, sales for the third quarter declined to $190m from $200m, while year-to-date sales increased to $598m from $589m last year. Agribusiness earnings from operations for the third quarter declined to $13.2m from $26.8m last year, and year-to-date earnings fell to $44.4m from $83.0m last year.

The bakery products division saw sales for the third quarter increase by 9% to $342m from $314m last year, while nine-month sales rose to $979m from $917m. Third-quarter earnings from operations in bakery fell to $23.8m from $31.4m last year, while year-to-date earnings declined to $77.5m from $78.9m.