Company will begin 'wet testing' at new facility in London, Ontario, this summer.
The long-awaited opening of Maple Leaf Foods’ new poultry processing plant in London, Ontario, is “now in sight,” the president of the company recently announced.
During a recent quarterly earnings call, Curtis Frank, president and chief operating officer of Maple Leaf Foods, gave an update on the progress of the soon-to-open facility.
“Our London poultry project has progressed tremendously, and we are extremely proud of how this world-class facility is shaping up,” Frank said.
Maple Leaf in 2018 announced its plans to build a 640,000-square-foot value-added poultry plant in London, however, that project had not progressed as quickly as originally hoped, with company officials on more than one occasion saying poor weather conditions played a role in that delay.
Now, things are moving at a much more rapid pace, and Frank is optimistic about the opportunities it will bring the company.
“The startup of this plant is now in sight, and our teams are gearing up for the exciting phase of wet testing, which will begin later this summer. Through the combination of the cost reductions that come with consolidating three facilities into one, creating additional capacity to grow our profitable value-added sales, and investing in word class technology to drive operational efficiency, the London poultry project will deliver a annual benefit of appx CA$100 million (US$78.3 million) of adjusted EBITDA, or 200 basis points of EBITDA margin expansion, once fully ramped up, which we expect to be complete by the end of 2023,” Frank said.
Also during the call, Maple Leaf Foods CEO Michael McCain went over the financial results for the second quarter.
For the three-month period ending on June 30, Maple Leaf Foods posted a net loss of CA$54.6 million, compared to net earnings of CA$8.8 million for the second quarter of 2021.
Sales for the quarter were up 3.1% to CA$1.2 billion. Sales in the company’s meat protein group were up 3.8%, while sales for the plant protein group were down 15.1%.
“This chaotic and unpredictable operating environment is unprecedented in my 40-year career in the food industry,” said McCain. “Driven by a post-pandemic economy and the tragic conflict in Eastern Europe, we have been unable to hire adequate people resources to operate our supply chains, experienced unnatural agricultural and trading markets, and realized hyper-inflation that has been challenging to keep up with pricing.”
However, McCain added that he sees “sees signs of these conditions abating.”
Par: Roy Graber (11/08/2022)
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