Maple Leaf Foods Reports Results for First Quarter 2011

    <<
    TSX: MFI
    www.mapleleaffoods.com
    >>

TORONTO, April 28 /CNW/ - Maple Leaf Foods Inc. (TSX: MFI) today reported its financial results for the first quarter ended March 31, 2011. First quarter highlights include:

    <<
    -   Adjusted Operating Earnings(1) increased 61% to $50.7 million
    -   Value creation initiatives on track and contributing to margin growth
    -   Net earnings in the quarter decreased 47% to $10.5 million, including
        $26.1 million in pre-tax restructuring costs
    -   Adjusted Earnings per Share(1) increased to $0.18 from $0.07 last
        year
    >>

"Maple Leaf Foods delivered our eighth consecutive quarter of improved results, with a significant increase in profitability in our fresh and prepared meats businesses." said Michael H. McCain, President and CEO. "We are very pleased with the progress on both short and long-term initiatives. Our value creation plan is on track and contributed to earnings in the quarter. While the most significant challenge has been rising raw material costs, we are passing on price increases to protect our margins. Overall, this was another strong quarter of performance."

(1): Adjusted Operating Earnings measures are defined as earnings from operations before restructuring and other related costs, other income and the impact of the change in fair value of non-designated interest rate swaps, unrealized gains/losses on commodity futures contracts and the change in fair value of biological assets. Adjusted Earnings per Share ("Adjusted EPS") measures are defined as basic earnings per share adjusted for the impact of restructuring and other related costs and the impact of the change in fair value of non-designated interest rate swaps, unrealized gains/losses on commodity futures contracts and the change in fair value of biological assets, net of tax and non-controlling interest. Please refer to the section entitled Reconciliation of Non-IFRS Financial Measures at the end of this news release.

Financial Overview

Sales for the first quarter of 2011 decreased 4% to $1,147.9 million compared to $1,191.5 million last year, primarily due to business divestitures. Excluding the effect of divestitures, and the impact of a stronger Canadian dollar, sales increased by 4%.

Adjusted Operating Earnings increased to $50.7 million compared to $31.5 million last year primarily due to improved performance in the Protein Group. Adjusted Earnings per Share increased to $0.18, including $2.4 million ($0.02 per share) related to tax benefits associated with a prior acquisition. Adjusted Earnings per Share for the prior period were $0.07.

Net earnings decreased to $10.5 million or $0.08 basic earnings per share in the first quarter compared to net earnings of $19.9 million or $0.14 basic earnings per share last year. Net earnings in the quarter included $26.1 million of pre-tax costs related to restructuring activities (2010: $4.0 million).

Several items are excluded from the discussions of underlying earnings performance during the quarter. These include restructuring charges, mark-to-market adjustments on hedging contracts that are not designated in a hedging relationship and mark-to-market adjustments related to biological assets. Restructuring charges are excluded as they do not reflect the continuing earnings performance of the business. Mark to market adjustments do not reflect the economic effect of the hedging transactions and are excluded from earnings discussions until the underlying asset is sold or transferred. A full reconciliation is included in the section entitled Reconciliation of Non-IFRS Financial Measures in this news release.

    <<
    Business Segment Review
    -----------------------
    >>

Following is a summary of sales by business segment:

    <<
    -------------------------------------------------------------------------
                                                           First Quarter
    (Unaudited)                                    --------------------------
    ($ thousands)                                         2011          2010
    -------------------------------------------------------------------------
    Meat Products Group                               $718,240      $768,180
    Agribusiness Group                                  57,294        41,808
    -------------------------------------------------------------------------
    Protein Group                                     $775,534      $809,988
    Bakery Products Group                              372,408       381,519
    -------------------------------------------------------------------------
    Sales                                           $1,147,942    $1,191,507
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    >>

The following table summarizes Adjusted Operating Earnings by business segment:

    <<
    -------------------------------------------------------------------------
                                                           First Quarter
    (Unaudited)                                    --------------------------
    ($ thousands)                                         2011          2010
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    Meat Products Group                                $26,645       $11,551
    Agribusiness Group                                  14,005         6,324
    -------------------------------------------------------------------------
    Protein Group                                      $40,650       $17,875
    Bakery Products Group                               12,188        17,102
    Non-allocated Costs in
     Adjusted Operating
     Earnings(i)                                        (2,153)       (3,521)
    -------------------------------------------------------------------------
    Adjusted Operating Earnings                        $50,685       $31,456
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    (i)    Non-allocated costs in Adjusted Operating Earnings comprise
           costs related to systems conversion and consulting fees.
           Management believes that not allocating these costs provides a
           more comparable assessment of operating results.
    >>
    <<
    Meat Products Group
    -------------------
    >>

Includes value-added prepared meats, chilled meal entrees and lunch kits; and fresh pork, poultry and turkey products sold to retail, foodservice, industrial and convenience channels. Includes leading Canadian brands such as Maple Leaf (R), Schneiders (R) and many leading sub-brands.

Sales for the first quarter decreased 7% to $718.2 million from $768.2 million in the first quarter last year, largely due to the sale of the Company's Burlington, Ontario primary pork processing operation in November 2010. Excluding this divestiture and the impact of a stronger Canadian dollar that reduced the sales value of exports, sales increased by 4%. The business benefited from higher market prices in fresh pork and increased net pricing and improved sales mix in prepared meats, which were partly offset by lower volumes in prepared meats.

Adjusted Operating Earnings in the Meat Products Group for the first quarter increased 131% to $26.6 million compared to $11.6 million last year, driven by margin expansion in prepared meats and improved primary processing markets.

Prepared meats margins strengthened as price increases were successfully implemented to manage the effect of rising input costs. Higher prices continued to result in some volume declines, consistent with the experience of others in the food industry. As food inflation trends continue in 2011, pricing will continue to be implemented as required to offset higher costs. New product innovation, including the Natural Selections(TM) line of sliced meat products, contributed to an improved sales mix and higher margins. The Company is building on the success of this natural product offering, made with no artificial preservatives, with the launch of Schneiders(R) Country Naturals(TM) sliced meats across a broad range of prepared meat products.

Strong performance in primary pork processing operations was driven by improved market conditions in North America and operating efficiencies at the Brandon pork processing facility. Earnings from the fresh poultry operations declined, as higher corn prices drove up live bird prices and contracted industry processor margins.

The Company continues to implement its value creation plan to increase shareholder value over the near and long term. This includes implementing price increases, simplifying its product mix and increasing scale in its manufacturing network. During the quarter, the Company announced that it will close its Surrey, B.C. prepared meats facility and transfer production to other facilities in order to consolidate production and reduce costs.

    <<
    Agribusiness Group
    ------------------
    >>

Consists of Canadian hog production and animal by-product recycling operations.

Sales in the Agribusiness Group for the first quarter increased 37% to $57.3 million from $41.8 million in the first quarter last year. Of this increase, approximately 25% was due to higher sales values, the remainder was related to higher volumes in the by-product recycling business.

Adjusted Operating Earnings in the Agribusiness Group in the first quarter increased to $14.0 million compared to $6.3 million last year, driven by stronger performance in both by-product recycling and hog production.

Hog prices have increased 18% since last year and outpaced the Company's net cost of grain, contributing to higher earnings. The contribution from by-products recycling operations also increased due to higher biodiesel sales volumes, eco-energy credits that were not received in the first quarter of 2010, and operational improvements. The benefit of higher market prices in the rendering business was mostly offset by higher raw material costs.

    <<
    Bakery Products Group
    ---------------------
    >>

Includes fresh and frozen bakery products, including breads, rolls, bagels, specialty and artisan breads, sweet goods, and fresh pasta and sauces sold to retail, foodservice and convenience channels. It includes national brands such as Dempster's(R), Tenderflake(R), Olivieri(R) and New York Bakery Co(TM), and many leading regional brands.

Sales in the Bakery Products Group for the first quarter decreased 2% to $372.4 million compared to $381.5 million last year, largely due to the sale of the Company's fresh sandwich product line in February, 2011. Excluding this and currency translation differences on sales in the U.S. and U.K., sales were consistent with prior year. While sales benefited from price increases implemented during 2010, this benefit was offset by volume declines. The North American frozen bakery business continued to experience weaker volumes due to changes implemented by certain retail customers earlier in 2010. Progress has been made in securing new business, which is expected to strengthen volumes in 2011. In the U.K., bagel volume increased significantly with the re-launch of the New York Bakery brand bagels, although overall volumes for the UK bakery were lower than last year.

Adjusted Operating Earnings in the Bakery Products Group for the first quarter decreased 29% to $12.2 million compared to $17.1 million last year, driven by the rapid rise in wheat prices and lower volumes. During the quarter the fresh bakery operation was significantly exposed to higher wheat prices with a lag in pricing to offset these inflationary pressures. Price increases were implemented at the end of the quarter and have begun to positively affect margins going forward. Also affecting earnings in the Bakery Products Group were lower volumes in the North American and U.K. frozen bakery businesses. In the U.K bakery, the margin improvement from the successful marketing campaign and product innovation in the bagel category was largely offset by the advertising and promotion expenses associated with the re-launch.

A significant element of the Company's value creation plan is the construction of the new fresh bakery in Hamilton, Ontario to benefit from scale efficiencies, reduce overhead costs and support future growth. This new bakery is on schedule to begin initial production in July 2011.

During the quarter the Company announced plans to close a fresh bakery facility located in Delta, B.C., in November 2011. Production will be consolidated at the Company's other bakeries in Langley, B.C. and Edmonton, Alberta. Concurrently, an investment of approximately $11.0 million will be made to expand the Edmonton bakery to support increased tortilla production, where the Company has a leading market position and brand.

In March 2011, the Company closed a sub-scale bakery in Laval, Quebec and transferred production to other bakeries where there was available capacity. Also in the first quarter of 2011, the Company entered into an agreement to sell a small bakery facility in Cumbria, U.K.

    <<
    Other Matters
    -------------
    >>

On April 27, 2011 Maple Leaf Foods Inc. declared a dividend of $0.04 per share payable on June 30, 2011 to shareholders of record at the close of business on June 10, 2011. Unless indicated otherwise by the Company in writing at or before the time the dividend is paid, these dividends will not be considered an eligible dividend for the purposes of the "Enhanced Dividend Tax Credit System".

It is currently anticipated that the full amount of the dividends to be paid in the first and second quarters of 2011 and a portion of the dividends to be paid in the third quarter will not be considered an eligible dividend for the purposes of the "Enhanced Dividend Tax Credit System". A portion of the dividend in the third quarter and the dividend for the fourth quarter are expected to be considered an eligible dividend for the purposes of the "Enhanced Dividend Tax Credit System".

An investor presentation related to the Company's fourth and full year financial results is available at www.mapleleaf.com and can be found under Investor Relations on the Quarterly Results page. A conference call will be held at 2:30 p.m. EDT on April 28, 2011 to review Maple Leaf Foods' first quarter financial results. To participate in the call, please dial 416-340-2219 or 877-240-9772. For those unable to participate, playback will be made available an hour after the event at 905-694-9451 / 800-408-3053 (Passcode 3612372).

A webcast presentation of the first quarter financial results will also be available at http://investor.mapleleaf.ca via a link:

http://phx.corporate-ir.net/phoenix.zhtml?p=irol-eventDetails&c=88490&eventID=3899007

The Company's full financial statements and related Management's Discussion and Analysis are available for download on the Company's website.

    <<
    Forward-Looking Statements
    >>

This document contains, and the Company's oral and written public communications often contain, forward-looking statements that are based on current expectations, estimates, forecasts and projections about the industries in which the Company operates and beliefs and assumptions made by the Management of the Company. Such statements include, but are not limited to, statements with respect to objectives and goals, as well as statements with respect to beliefs, plans, objectives, expectations, anticipations, estimates and intentions. Specific forward-looking statements in this document include, but are not limited to, statements with respect to improving business trends in 2011, expectations regarding actions to reduce costs, restore and/or promote volumes and/or increase prices, improve efficiencies, the expected use of cash balances, source of funds for ongoing business requirements, capital investments and debt repayment, and expectations regarding sufficiency of the allowance for uncollectible accounts. Words such as "expect", "anticipate", "intend", "attempt", "may", "will", "plan", "believe", "seek", "estimate", and variations of such words and similar expressions are intended to identify such forward-looking statements. These statements are not guarantees of future performance and involve assumptions and risks and uncertainties that are difficult to predict.

In addition, these statements and expectations concerning the performance of the Company's business in general are based on a number of factors and assumptions including, but not limited to: the condition of the Canadian, United States, United Kingdom and Japanese economies; the rate of exchange of the Canadian dollar to the U.S. dollar, British pound and the Japanese yen; the availability and prices of raw materials, energy and supplies; product pricing; the availability of insurance; the competitive environment and related market conditions; improvement of operating efficiencies whether as a result of the protein business transformation or otherwise; continued access to capital; the cost of compliance with environmental and health standards; no adverse results from ongoing litigation; no unexpected actions of domestic and foreign governments; and the general assumption that none of the risks identified below or elsewhere in this document will materialize. All of these assumptions have been derived from information currently available to the Company including information obtained by the Company from third-party sources. These assumptions may prove to be incorrect in whole or in part. In addition, actual results may differ materially from those expressed, implied or forecasted in such forward-looking statements, which reflect the Company's expectations only as of the date hereof.

Factors that could cause actual results or outcomes to differ materially from the results expressed, implied or forecasted by forward-looking statements are discussed more fully in the Company's Annual Management's Discussion and Analysis for the period ended March 31, 2011 including the section entitled "Risk Factors" that is available on SEDAR at www.sedar.com. The Company does not intend to, and the Company disclaims any obligation to, update any forward-looking statements, whether written or oral, or whether as a result of new information, future events or otherwise except as required by law.

Maple Leaf Foods Inc. is a leading food processing company, headquartered in Toronto, Canada. The Company employs approximately 21,000 people at its operations across Canada and in the United States, the United Kingdom, and Asia. The Company had sales of $5.0 billion in 2010.

    <<
    Reconciliation of Non-IFRS Financial Measures
    ---------------------------------------------
    >>

The Company uses the following non-IFRS measures: Adjusted Operating Earnings and Adjusted EPS. Management believes that these non-IFRS measures provide useful information to both Management and investors in measuring the financial performance of the Company for the reasons outlined below. These measures do not have a standardized meaning prescribed by IFRS and therefore they may not be comparable to similarly titled measures presented by other publicly traded companies and should not be construed as an alternative to other financial measures determined in accordance with IFRS.

Adjusted Operating Earnings

The following table reconciles earnings from operations before restructuring and other related costs, other income (expense) and the impact of the change in fair value of non-designated interest rate swaps, unrealized gains/losses on commodity futures contracts and the change in fair value of biological assets to net earnings as reported under IFRS in the unaudited condensed consolidated interim statements of earnings for the three-month periods ended as indicated below. Management believes that this is the most appropriate basis on which to evaluate operating results, as restructuring and other related costs, other income (expense) and the change in fair value of non-designated interest rate swaps, unrealized gains/losses on commodity futures contracts and the change in fair value of biological assets are not representative of operational results during the period.

    <<
    -------------------------------------------------------------------------
    (Unaudited)                   Three months ended March 31, 2011
    -------------------------------------------------------------------------
    ($ thousands)(1)             Meat    Agri-   Bakery      Non-   Consol-
                              Products business Products allocated   idated
                                 Group    Group    Group     Costs
    -------------------------------------------------------------------------
    Net earnings                                                     $10,547
    Income taxes                                                       2,426
    -------------------------------------------------------------------------
    Earnings from operations
     before income taxes                                              12,973
    Interest expense                                                  17,951
    Change in the fair
     value of non-designated
     interest rate swaps                                              (4,665)
    Other income                    (4)     (89)     (78)       15      (156)
    Restructuring and other
     related costs               5,281        -   20,050       794    26,125
    -------------------------------------------------------------------------
    Earnings from Operations    26,645   14,005   12,188      (610)   52,228
    (Increase) / decrease in
     fair value of biological
     assets                          -        -        -    (5,507)   (5,507)
    Unrealized (gains) / losses
     on commodity futures
     contracts                       -        -        -     3,964     3,964
    -------------------------------------------------------------------------
    Adjusted Operating
     Earnings                  $26,645  $14,005  $12,188   ($2,153)  $50,685
    -------------------------------------------------------------------------
    (1) May not add due to rounding


    -------------------------------------------------------------------------
    (Unaudited)                    Three months ended March 31, 2010
    -------------------------------------------------------------------------
    ($ thousands)(1)             Meat    Agri-   Bakery      Non-   Consol-
                              Products business Products allocated   idated
                                 Group    Group    Group     Costs
    -------------------------------------------------------------------------
    Net earnings                                                     $19,892
    Income taxes                                                       7,511
    -------------------------------------------------------------------------
    Earnings from operations
     before income taxes                                              27,403
    Interest expense                                                  16,069
    Change in the fair value
     of non-designated
     interest rate swaps                                                   -
    Other income                (1,208)     955      (72)       (4)     (329)
    Restructuring and other
     related costs               2,469     (210)   1,704         -     3,963
    -------------------------------------------------------------------------
    Earnings from
     Operations                 11,551    6,324   17,102    12,129    47,106
    (Increase) / decrease in
     fair value of biological
     assets                          -        -        -   (14,212)  (14,212)
    Unrealized (gains) / losses
     on commodity futures
     contracts                       -        -        -    (1,438)   (1,438)
    -------------------------------------------------------------------------
    Adjusted Operating
     Earnings                  $11,551   $6,324  $17,102   ($3,521)  $31,456
    -------------------------------------------------------------------------
    (1) May not add due to rounding
    >>

Adjusted Earnings per Share

The following table reconciles Adjusted Earnings per Share to basic earnings per share as reported under IFRS in the unaudited condensed consolidated interim statements of earnings for the three-month periods ended as indicated below. Management believes this is the most appropriate basis on which to evaluate financial results as restructuring and other related costs and the changes in the fair value of non-designated interest rate swaps, unrealized gains/losses on commodity futures contracts and the change in fair value of biological assets net of tax and non-controlling interests are not representative of operational results.

    <<
    -------------------------------------------------------------------------
                                                          Three months ended
    (Unaudited)                                                 March 31,
                                                         --------------------
    ($ per share)                                           2011        2010
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    Basic earnings per share                                0.08        0.14
    Restructuring and other related costs(i)                0.13        0.02
    Change in the fair value of
     non-designated interest rate swaps(ii)                (0.02)          -
    Unrealized gains/losses on commodity
     futures contracts                                      0.02       (0.01)
    Change in fair value of biological
     assets(ii)                                            (0.03)      (0.08)
    -------------------------------------------------------------------------
    Adjusted Earnings per Share                             0.18        0.07
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------


    (i)    Includes per share impact of restructuring and other related
           costs, net of tax and non-controlling interest.
    (ii)   Includes per share impact of the change in fair value of non-
           designated interest rate swaps, unrealized gains/losses on
           commodity futures contracts and the change in fair value of
           biological assets, net of tax.



             Condensed Consolidated Interim Financial Statements
                       (Expressed in Canadian dollars)
                                 (Unaudited)

                            MAPLE LEAF FOODS INC.


                 Three months ended March 31, 2011 and 2010


    MAPLE LEAF FOODS INC.
    Consolidated Balance Sheets
    (In thousands of Canadian dollars)
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

                                As at        As at        As at        As at
                             March 31,    March 31, December 31,   January 1,
    (Unaudited)                  2011         2010         2010         2010
    -------------------------------------------------------------------------
    ASSETS
    Current assets
      Cash and cash
       equivalents        $    15,936  $    72,334  $         -  $    29,316
      Accounts receivable     105,687      335,318       84,117      375,143
      Notes receivable        124,733            -      136,663            -
      Inventories             299,024      330,703      275,643      298,320
      Biological assets        52,989       52,327       45,440       42,568
      Income and other
       taxes recoverable       39,138       15,807       29,957       18,067
      Prepaid expenses
       and other assets        33,436       18,978       14,766       15,328
    -------------------------------------------------------------------------
                          $   670,943  $   825,467  $   586,586  $   778,742

      Property and
       equipment            1,016,913    1,059,532    1,025,012    1,084,147
      Investment property      11,523        6,468        6,832        6,646
      Employee benefits        52,825      103,253       55,761      104,386
      Other long-term
       assets                   5,901        4,992        6,426        5,407
      Deferred tax asset      103,840       96,034      110,286       91,768
      Goodwill                751,484      752,838      752,911      755,059
      Other intangible
       assets                 169,752      143,783      164,178      137,239
    -------------------------------------------------------------------------
      Total assets        $ 2,783,181  $ 2,992,367  $ 2,707,992  $ 2,963,394
    -------------------------------------------------------------------------
    LIABILITIES AND
      EQUITY
    Current liabilities
      Bank indebtedness   $         -  $     6,167  $    15,858  $     4,247
      Accounts payable
       and accruals           475,118      649,524      481,816      638,146
      Provisions               44,860       19,681       35,062       20,612
      Current portion of
       long-term debt         250,286      202,776      496,835      206,147
      Other current
       liabilities             84,276       39,479       63,465       37,837
    -------------------------------------------------------------------------
                          $   854,540  $   917,627  $ 1,093,036  $   906,989

      Long-term debt          691,278      831,946      389,078      834,557
      Deferred tax
       liability               22,911       29,263       26,183       31,091
      Employee benefits       105,370      103,905      105,849      101,379
      Other long-term
       liabilities            100,845      111,715       98,417       98,918
    -------------------------------------------------------------------------
       Total liabilities  $ 1,774,944  $ 1,994,456  $ 1,712,563  $ 1,972,934
    -------------------------------------------------------------------------
    Shareholders' Equity
    Share capital         $   902,810  $   869,393  $   902,810  $   869,353
    Retained earnings          41,271       45,904       36,201       32,733
    Contributed surplus        63,279       61,486       59,002       57,486
    Accumulated other
     comprehensive loss       (50,909)     (14,544)     (55,396)      (5,055)
    Treasury stock            (10,078)     (24,499)     (10,078)     (24,499)
    -------------------------------------------------------------------------
    Total shareholders'
     equity               $   946,373  $   937,740  $   932,539  $   930,018
    Non-controlling
     interest                  61,864       60,171       62,890       60,442
    -------------------------------------------------------------------------
    Total equity          $ 1,008,237  $   997,911  $   995,429  $   990,460
    -------------------------------------------------------------------------
    Total liabilities
     and equity           $ 2,783,181  $ 2,992,367  $ 2,707,992  $ 2,963,394
    -------------------------------------------------------------------------



    MAPLE LEAF FOODS INC.
    Consolidated Statements of Earnings
    (In thousands of Canadian dollars, except share amounts)

    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
                                                 Three months ended March 31,
    (Unaudited)                                            2011         2010
    -------------------------------------------------------------------------

    Sales                                           $ 1,147,942  $ 1,191,507

    Cost of goods sold                                  966,689    1,016,082

    -------------------------------------------------------------------------
    Gross margin                                    $   181,253  $   175,425

    Selling, general and administrative expenses        129,025      128,319
    -------------------------------------------------------------------------

    Earnings from operations before the following:  $    52,228  $    47,106

    Restructuring and other related costs               (26,125)      (3,963)
    Change in fair value of non-designated
     interest rate swaps                                  4,665            -
    Other income                                            156          329
    -------------------------------------------------------------------------

    Earnings from operations before interest
     and income taxes                               $    30,924  $    43,472

    Interest expense                                     17,951       16,069
    -------------------------------------------------------------------------

    Earnings from operations before income taxes    $    12,973  $    27,403

    Income taxes                                          2,426        7,511
    -------------------------------------------------------------------------

    Net earnings                                    $    10,547  $    19,892
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    Attributed to:

    Common shareholders                             $    10,662  $    18,565
    Non-controlling interest                               (115)       1,327
    -------------------------------------------------------------------------

                                                    $    10,547  $    19,892
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    Earnings per share attributable to
     common shareholders

    Basic earnings per share                        $      0.08  $      0.14
    Diluted earnings per share                      $      0.07  $      0.13

    -------------------------------------------------------------------------

    Weighted average number of shares (millions)          139.2        134.9

    -------------------------------------------------------------------------



    MAPLE LEAF FOODS INC.
    Consolidated Statements of Comprehensive Income (Loss)
    (In thousands of Canadian dollars)

    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
                                                 Three months ended March 31,
    (Unaudited)                                            2011         2010
    -------------------------------------------------------------------------

    Net earnings                                    $    10,547  $    19,892
    -------------------------------------------------------------------------

    Other comprehensive income (loss)
      Change in accumulated foreign
       currency translation adjustment                   (1,211)     (11,636)
      Change in unrealized loss on cash flow
       hedges                                             5,038          835
    -------------------------------------------------------------------------
                                                    $     3,827  $   (10,801)
    -------------------------------------------------------------------------

    Comprehensive income                            $    14,374       $9,091
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    Attributed to:

    Common shareholders                             $    15,149       $9,076
    Non-controlling interest                               (775)          15
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------



    MAPLE LEAF FOODS INC.
    Consolidated Statements of Changes in Shareholders' Equity
    (In thousands of Canadian dollars)

    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
                                     Attributable to common shareholders
                            -------------------------------------------------
                                                             Total
                                                            accum-
                                                            ulated
                                                             other
                                                    Con-     comp-
                               Share  Retained  tributed rehensive  Treasury
    (Unaudited)              capital  earnings   surplus      loss     stock
    -------------------------------------------------------------------------

    Balance at
     January 1, 2010        $869,353  $ 32,733  $ 57,486  $ (5,055) $(24,499)

      Net earnings                 -    18,565         -         -         -
      Other comprehensive
       income                      -         -         -    (9,489)        -
      Dividends declared
       ($0.04 per share)           -    (5,394)        -         -         -
      Stock-based
       compensation
       expense                     -         -     4,000         -         -
      Share options
       exercised                  40         -         -         -         -
    -------------------------------------------------------------------------
    Balance at
     March 31, 2010         $869,393  $ 45,904  $ 61,486  $(14,544) $(24,499)
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------


    -------------------------------------------
    -------------------------------------------



                            Non-con-
                            trolling     Total
    (Unaudited)             interest    equity
    -------------------------------------------

    Balance at
     January 1, 2010        $ 60,442  $990,460

      Net earnings             1,327    19,892
      Other comprehensive
       income                 (1,312)  (10,801)
      Dividends declared
       ($0.04 per share)        (286)   (5,680)
      Stock-based
       compensation
       expense                     -     4,000
      Share options
       exercised                   -        40
    -------------------------------------------
    Balance at
     March 31, 2010         $ 60,171  $997,911
    -------------------------------------------
    -------------------------------------------



    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
                                     Attributable to common shareholders
                            -------------------------------------------------
                                                             Total
                                                            accum-
                                                            ulated
                                                             other
                                                    Con-     comp-
                               Share  Retained  tributed rehensive  Treasury
    (Unaudited)              capital  earnings   surplus      loss     stock
    -------------------------------------------------------------------------
    Balance at
     January 1, 2011        $902,810  $ 36,201  $ 59,002  $(55,396) $(10,078)

      Net earnings                 -    10,662         -         -         -
      Other comprehensive
       income                      -         -         -     4,487         -
      Dividends declared
       ($0.04 per share)           -    (5,592)        -         -         -
      Stock-based
       compensation
       expense                     -         -     4,277         -         -
      Share options
       exercised                   -         -         -         -         -
    -------------------------------------------------------------------------
    Balance at
     March 31, 2011         $902,810  $ 41,271  $ 63,279  $(50,909) $(10,078)
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------


    -------------------------------------------
    -------------------------------------------



                            Non-con-
                            trolling     Total
    (Unaudited)             interest    equity
    --------------------------------------------
    Balance at
     January 1, 2011        $ 62,890 $  995,429

      Net earnings              (115)    10,547
      Other comprehensive
       income                   (660)     3,827
      Dividends declared
       ($0.04 per share)        (251)    (5,843)
      Stock-based
       compensation
       expense                     -      4,277
      Share options
       exercised                   -
    --------------------------------------------
    Balance at
     March 31, 2011         $ 61,864 $1,008,237
    --------------------------------------------
    --------------------------------------------



    MAPLE LEAF FOODS INC.
    Consolidated Statements of Cash Flows
    (In thousands of Canadian dollars)
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
                                                 Three months ended March 31,
    (Unaudited)                                            2011         2010
    -------------------------------------------------------------------------
    CASH PROVIDED BY (USED IN):

    Operating activities
      Net earnings                                  $    10,547  $    19,892
      Add (deduct) items not affecting cash:
        Change in fair value of biological assets        (5,507)     (14,212)
        Depreciation and amortization                    32,869       37,704
        Stock-based compensation                          4,277        4,000
        Deferred income taxes                             1,130       (6,814)
        Income tax current                                1,286       13,848
        Interest expense                                 17,951       16,069
        Gain on sale of property and equipment              (24)      (1,243)
        Amortization of terminated interest rate
         swap                                               503          503
        Change in fair value of non-designated
         interest rate swaps                             (4,666)           -
        Change in fair value of derivative
         financial instruments                            4,373       (2,972)
      Decrease in pension asset                           2,457        2,862
      Income taxes paid                                  (9,998)     (11,508)
      Interest paid                                      (3,364)      (2,959)
      Change in provision for restructuring and
       other related costs                               20,652          182
      Other                                              (2,702)      (2,953)
      Change in non-cash operating working capital      (62,088)      12,081
    -------------------------------------------------------------------------
    Cash provided by operating activities           $     7,696  $    64,480
    -------------------------------------------------------------------------

    Financing activities
      Dividends paid                                $    (5,592) $    (5,394)
      Dividends paid to non-controlling interest           (251)        (286)
      Net increase in long-term debt                     77,805        9,475
      Increase in share capital                               -           40
      Increase in financing costs                        (2,138)           -
      Other                                                   -         (677)
    -------------------------------------------------------------------------
    Cash provided by financing activities           $    69,824  $     3,158
    -------------------------------------------------------------------------

    Investing activities
      Additions to property and equipment           $   (50,334) $   (28,703)
      Capitalization of interest expense                 (1,377)         (58)
      Proceeds from sale of property and equipment        5,437        2,172
      Other                                                 548           49
    -------------------------------------------------------------------------
    Cash used in investing activities               $   (45,726) $   (26,540)
    -------------------------------------------------------------------------

    Increase in cash and cash equivalents           $    31,794  $    41,098

    Net cash and cash equivalents, beginning of
     period                                             (15,858)      25,069

    -------------------------------------------------------------------------
    Net cash and cash equivalents, end of period    $    15,936  $    66,167
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    Net cash and cash equivalents is comprised of:

    Cash and cash equivalents                       $    15,936  $    72,334
    Bank indebtedness                                         -       (6,167)

    -------------------------------------------------------------------------
    Net cash and cash equivalents, end of period    $    15,936  $    66,167
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------



    MAPLE LEAF FOODS INC.
    Segmented Financial Information
    (In thousands of Canadian dollars)

    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
                                                 Three months ended March 31,
                                                           2011         2010
    -------------------------------------------------------------------------

    Sales
      Meat Products Group                           $   718,240  $   768,180
      Agribusiness Group                                 57,294       41,808
      Bakery Products Group                             372,408      381,519
    -------------------------------------------------------------------------
                                                    $ 1,147,942  $ 1,191,507
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    Earnings from operations before
     restructuring and other related costs
     and other income
      Meat Products Group                           $    26,645  $    11,551
      Agribusiness Group                                 14,005        6,324
      Bakery Products Group                              12,188       17,102
      Non-allocated costs                                  (610)      12,129
    -------------------------------------------------------------------------
                                                    $    52,228  $    47,106
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    Capital expenditures
      Meat Products Group                           $    14,417  $    13,626
      Agribusiness Group                                  2,633        4,191
      Bakery Products Group                              33,284       10,886
    -------------------------------------------------------------------------
                                                    $    50,334  $    28,703
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    Depreciation and amortization
       Meat Products Group                          $    15,819  $    20,103
       Agribusiness Group                                 3,940        4,111
       Bakery Products Group                             13,110       13,490
    -------------------------------------------------------------------------
                                                    $    32,869  $    37,704
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    -------------------------------------------------------------------------

                             March 31,    March 31, December 31,   January 1,
                                 2011         2010         2010         2010
    -------------------------------------------------------------------------

    Total assets
      Meat Products Group $ 1,476,676  $ 1,619,082  $ 1,405,566  $ 1,619,072
      Agribusiness Group      213,616      240,797      211,858      226,844
      Bakery Products
       Group                  850,571      855,386      836,447      890,578
      Non-allocated
       assets                 242,318      276,382      254,121      226,900
    -------------------------------------------------------------------------
                          $ 2,783,181  $ 2,992,367  $ 2,707,992  $ 2,963,394
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    Goodwill
      Meat Products Group $   442,336  $   442,806  $   442,336  $   443,150
      Agribusiness Group       13,939       13,939       13,939       13,939
      Bakery Products
       Group                  295,209      296,093      296,636      297,970
    -------------------------------------------------------------------------
                          $   751,484  $   752,838  $   752,911  $   755,059
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    >>

SOURCE Maple Leaf Foods Inc.

For further information: Investor Contact: Nick Boland, VP Investor Relations: 416-926-2005; Media Contact: 416-926-2020


FORFAITS PERSONNALISÉS

Jetez un coup d’œil sur nos forfaits personnalisés ou créez le vôtre selon vos besoins de communication particuliers.

Commencez dès aujourd'hui .

ADHÉSION À CNW

Remplissez un formulaire d'adhésion à CNW ou communiquez avec nous au 1-877-269-7890.

RENSEIGNEZ-VOUS SUR LES SERVICES DE CNW

Demandez plus d'informations sur les produits et services de CNW ou communiquez avec nous au 1‑877-269-7890.