MISSISSAUGA, ONTARIO — Maple Leaf Foods Inc. has laid the groundwork for a transformative year in 2025. The company has finished the initial phase of its business restructure and continues to make advancements on the pork spin-off, known as Canada Packers.
“This year will be a significant year of strategic transformation and financial progress for Maple Leaf Foods,” said Curtis Frank, president and chief executive officer of Maple Leaf Foods. “Our growth strategies have proven to be resilient and successful even in the most challenging conditions, our capital projects are exiting 2024 contributing expected benefits, market conditions and consumer behavior are recovering as anticipated, and we recently completed the first phase of our Fuel for Growth cost competitiveness initiatives, all of which we expect will underpin a meaningful improvement in profitable growth and the ongoing de-leveraging of our balance sheet.”
Maple Leaf Foods unveiled its 2025 operating plan, consisting of the following priorities:
- Revenue growth of mid-single digits driven by execution of the company's proven growth strategies.
- Significant year-over-year Adjusted EBITDA improvements driven by the full benefits of capital investments, excellence in brand and revenue management, recent restructuring and supply chain cost saving initiatives and the return of normalized market conditions.
- Continued deleveraging of the balance sheet driven by strong free cash flow from operations.
- Completion of the spin-out of Canada Packers.
- Further optimizing performance through a refocused organizational structure.
“Maple Leaf Foods has demonstrated its ability to outperform our peers in both top and bottom-line performance,” Frank said. “We expect this trend to accelerate in 2025 as our long-term strategies and focus yield clear and measurable results.”
Looking to capitalize on the growing consumer demand for protein, Maple Leaf Foods looks to leverage its position as leader in sustainable meats. The company will increase its marketing and advertising investments in the coming year for each of its brands with a unique strategy to reach the target consumers.
A key market that Maple Leaf Foods has set its sights on is the US market. Maple Leaf Foods hopes to build its existing protein platform in the United States and add new organizational structure.
With its growth-driven strategies, Maple Leaf Foods anticipates meeting or even exceeding current analyst consensus estimates of an Adjusted EBITDA of $634 million.
Contributing to the strong performance forecasted is Maple Leaf’s new Fuel for Growth initiative, which accelerates the company’s cost reduction focus and competitive edge by optimizing resources and processes, including automation investments. By the end of 2024, the Maple Leaf Foods completed a sourcing optimization initiative that will deliver enhanced savings, scalability and supply chain agility in the coming year.
Also, at the end of last year, Maple Leaf completed the first phase of SG&A (Selling, General and Administrative) reductions, resulting in a smaller headcount. This effort combined with right-sizing SG&A investments in the plant protein category will likely lead to significant savings in 2025.
Additional savings are expected to come from Maple Leaf’s closure of the Brantford, Ontario, plant in the first half of 2025, as the company works to consolidate its further processed poultry production.
Update on Canada Packers
In the company’s fiscal third quarter of 2024 earnings report, Maple Leaf announced that its pork spin-off is taking steps to become a tax-free butterfly reorganization that would require an advance tax ruling from the Canada Revenue Agency (CRA). The ruling request has been submitted, and Maple Leaf looks to hear a decision within the next nine months.
Maple Leaf has scheduled a shareholder meeting in June to approve the transaction of Canada Packers, which would allow closing to occur as soon as a positive CRA ruling has been received.
As such, Maple Leaf said the transaction is on pace to close in the second half of 2025.
“With pork markets more or less normalized, the timing to complete the transaction this year is very positive,” Frank said. “We are pleased with the progress we have made on the business and operational plans to maximize readiness once we have secured all the necessary approvals, and we are excited for the value creation potential that this transaction holds for both companies and their stakeholders going forward.”
The separation of the two companies is progressing with discussions taking place on capital structure and dividend policies. The current plan is for the initial combined dividends of Maple Leaf Foods and Canada Packers to not be less than Maple Leaf Foods’ annual dividend immediately prior to the completion of the spin-off. Future dividends will be at the discretion of each company’s board of directors. The capital structure for the two companies is also being evaluated. Full details will be included in the Management Information Circular, which is expected to be filed in May, ahead of the shareholder meeting to approve the transaction.