MISSISSAUGA, ONTARIO — Maple Leaf Foods Inc.’s fiscal 2023 second-quarter financial results reflected some positive results in some business segments, but industry headwinds presented financial challenges for the company. 

For the period ended June 30, 2023, the meat company reported a net income loss of C$53.7 million ($40.21 million), equal to 44¢ (33¢) per share on the common stock and up from a loss of C$54.6 million, or C44¢ per share during the same period last year.

Total quarterly sales rose to C$1.27 billion ($950 million) up 6.2% from C$1.19 billion during the second quarter of fiscal 2022.

“In our second quarter, we successfully executed our playbook, improving the financial performance of our business and marking a significant step toward the next inflection point in our journey,” said Curtis Frank, chief executive officer of Maple Leaf Foods. “With our supply chain stabilized and pricing now in place to mitigate current levels of inflation, we are well positioned to meet our Adjusted EBITDA margin target of 14-16% once pork markets normalize.”

Meat Protein Group sales rose 6.6% during the quarter to C$1.24 billion ($930 million) and were driven by an increase in volumes and pricing actions taken to offset inflation. The company’s sales also benefited from favorable foreign exchange rates and favorable shifts in product mix, according to the company.

“We sequentially improved our Adjusted EBITDA margins in the Meat Protein business, and we advanced our strategic plan to achieve Adjusted EBITDA neutral or better in our Plant Protein business in the second half of 2023,” Frank added.

In its outlook, Maple Leaf added that it expects mid-to-high single digit sales growth in 2023 for its Meat Protein Group.

Adjusted operating earnings increased in Q2 to C$45.9 million compared to C$23.6 million over the same period in 2022. Adjusted operating earnings in the first six months were up, at C$65.2 million compared to C$39.7 million last year.

The company said capital expenditure estimates remained unchanged for 2023 at less than C$250 million. 

Maple Leaf said cap ex projects include increasing further processing poultry capacity at its prepared meats facility in Brampton, Ontario. The company also said it is investing residual expenditures at its London, Ontario poultry plant and expanded capacity for the snacking kits category.

“Looking forward to 2024 and beyond, we can’t help but be optimistic,” Frank said. “We are on track to realize the benefits of the major capital investments we’ve made at our London Poultry and Bacon Centre of Excellence facilities as we continue to advance our vision of becoming the most sustainable protein company on earth.”

Plant Protein Group sales decreased 10.2% during the quarter to C$36.7 million ($27.5 million) compared to C$40.8 million in 2022.