In a press release dated November 13th Maple Leaf Foods Inc. (MFI-TO) announced results for Q3 FY 2024 ended September 30th 2024. Revenue beat consensus with concurrent growth in EBITDA
The following table summarizes the results for the period compared with the values for the corresponding quarter of the previous fiscal year (Values expressed as US$ x 1,000 except EPS (conversion: CAN$1=US$0.73)
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3rd Quarter Ending September 30th
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2024
|
2023
|
Difference (%)
|
|
Sales:
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$894,656
|
$879,172
|
+1.8
|
|
Gross profit:
|
$132,211
|
$103,558
|
+27.7
|
|
Operating income:
|
$47,092
|
$28,557
|
+64.9
|
|
Pre-tax Income
Net Income/ (Loss)
|
$16,500
$12,557
|
$(174)
$(3,035)
|
+5,582
+141
|
|
Diluted earnings per share:
|
$(0.10)
|
$(0.03)
|
+433
|
|
Gross Margin (%)
|
14.8
|
11.8
|
+25.4
|
|
Operating Margin (%)
|
5.3
|
3.3
|
+60.6
|
|
Profit Margin (%)
|
1.4
|
-0.4
|
+450
|
|
Long-term Debt and lease obligations:
|
$1,254,437
|
$1,217,132
|
+3.1
|
|
12 Months Trailing:
|
|
|
|
|
Return on Assets (%)
|
3.3
|
|
|
|
Return on Equity (%)
|
2.2
|
|
|
|
Operating Margin (%)
|
5.4
|
|
|
|
Profit Margin (%)
|
-0.7
|
|
|
|
Total Assets
Intangibles and goodwill as % of assets
|
$3,162,479
25.8
|
$32,416,522
34.3
|
+30.9
|
|
Market Capitalization Sept. 30th 2024/ 2023
|
$1,938,000
|
$2,258,000
|
-14.2
|
52-Week Range in Share Price: $14.95 to $19.56 50-day Moving average $15.68
Forward P/E 32.6 Beta 0.5
Insider shareholding 40.0%. Institutional shareholding 26.2%
In commenting on Q4 results Curtis Frank president and CEO stated “In the third quarter of 2024, we made significant strides in executing our strategic playbook, achieving strong results in a challenging consumer landscape. Our sales increased by 1.8 percent driven by over 3 percent growth in our prepared meats business, while Adjusted EBITDA rose to Can.$141 million.
Frank continued, “These results reflect our continued investment in our market-leading brands, our leadership in sustainable meats, and alignment with our customers’ strategies, as we expanded retail market share and demonstrated growth in our Food Service portfolio. These factors, together with improving pork market conditions and the benefits from our capital projects, fueled a Can.$9.0m percent year-over-year increase in Adjusted EBITDA.
Frank concluded “We continue to be very excited about the benefits of the spin-off of our pork business, and the future of Maple Leaf Foods and Canada Packers as independent, public companies. The prospect of executing the transaction as a tax-free spin-off is a positive development as we continue to advance our strategy to unlock value and unleash the potential of these two unique and distinct businesses."
Given restructuring, it will no longer be able to evaluate the plant-protein business or to confirm that this previous segment achieved profitability as projected. It appears that Maple Leaf Foods has followed the expedient of “if you can’t fix it, bury it”!
The outlook for the remainder of FY 2024 will include a low single digit increase in revenue growth and capital expenditure of $50 million.