Maple Leaf Foods Reports Results for Fourth Quarter Fiscal 2007



    EARNINGS INCREASE DESPITE CURRENCY AND COMMODITY HEADWINDS

    TORONTO, Feb. 21 /CNW/ - Maple Leaf Foods Inc. (TSX: MFI) today reported
its financial results for the fourth quarter and year ended December 31, 2007.

    
    Financial and operational highlights include:

    -   Earnings from operations increased 11% in the quarter;
        15% for the year
    -   Earnings per share increased 54% to $0.20 in the quarter;
        $0.51 for the year
    -   Protein Group operating earnings up 15% in the quarter;
        14% for the year
    -   Bakery Products Group operating earnings up 5% for the quarter;
        16% for the year
    -   Successfully double shifted front end processing at the Brandon pork
        plant
    -   Completed the sale of non-core hog production operations
        in early 2008

    Note: All earnings measures are defined as earnings from continuing
    operations before restructuring and other related costs. All earnings per
    share measures are defined as earnings per share from continuing
    operations before restructuring and other related costs and certain non-
    recurring tax adjustments.
    

    "The global food industry has been impacted by the ripple effect of an
unprecedented rise in commodity grain costs over the past year. Our steady
performance in 2007 reflects our efforts to manage this impact through
reducing costs and raising prices," said Michael H. McCain, President and CEO.
"While we are well positioned to offset a continued rise in input costs over
time, heading into 2008 we may face some short-term volatility depending on
the precise timing of matching price action with cost increases, given the
magnitude of the changes. However, we are making excellent progress in
implementing structural changes in our protein operations that will
substantially increase profitability and reduce currency and commodity
exposure for the long term. This includes the recent sale of our Ontario and
Alberta hog operations that will significantly reduce our losses in this
business."

    Financial Overview
    ------------------

    Sales for the fourth quarter decreased by 6% to $1.3 billion compared to
the same period last year, and year to date sales decreased 2% to
$5.2 billion. Although price increases and acquisitions have generated higher
sales, total sales are lower due to the impact of the sale or exit of non-core
businesses and the stronger Canadian dollar.
    Earnings from continuing operations before restructuring and other
related costs ("Adjusted Operating Earnings") increased 11% to $57.9 million
for the quarter and by 15% to $199.1 million for the year. Price increases in
both the Bakery and Meat Products Groups mostly offset rising input costs and,
combined with improved operational efficiencies and the contribution of
acquisitions in the U.K., had a positive impact on results for the quarter and
the year.
    Earnings per share from continuing operations before restructuring and
other related costs and certain non-recurring tax adjustments ("Adjusted EPS")
for the quarter were $0.20, compared to $0.13 last year. Earnings per share
for the year, on a comparable basis, were $0.51 compared to $0.38 last year.

    Following is a summary of Adjusted EPS:

    
                                          Fourth Quarter       Year-To-Date
                                        -------------------------------------
                                          2007      2006      2007      2006
                                          ----      ----      ----      ----

    EPS from continuing operations      ($0.19)   ($0.14)   ($0.18)   ($0.16)

    Restructuring and other related
     costs, net of tax (i)               $0.47     $0.27     $0.77     $0.53

    Tax benefit from lower future tax
     rates (ii)                         ($0.08)        -    ($0.08)        -

                                        -------------------------------------
    Adjusted EPS (iii)(iv)               $0.20     $0.13     $0.51     $0.38

    Discontinued operations              $0.01     $0.05     $1.81     $0.19

                                        -------------------------------------
                                        -------------------------------------
    EPS before restructuring and other
     related costs (iii) (iv)            $0.22     $0.17     $2.32     $0.57
                                        -------------------------------------
                                        -------------------------------------

    (i)    Includes the per share impact of restructuring and other related
           costs net of tax and minority interest and includes the
           recognition of a tax benefit of $5.1 million in Q2 2007 related to
           the sale of the animal nutrition business and a non-recurring tax
           adjustment in 2006 for $21.2 million to write down future tax
           assets related to the Company's U.S. frozen bakery business.
    (ii)   During 2007, the Company recorded a net tax benefit of
           $9.9 million related to the enactment of lower future tax rates.
    (iii)  These are not recognized measures under Canadian GAAP. Management
           believes that this is the most appropriate basis on which to
           evaluate results, as restructuring and other related costs are not
           representative of continuing operations.
    (iv)   Does not add due to rounding.


    Business Segment Review
    -----------------------

    Following is a summary of Adjusted Operating Earnings by business segment:

    ($ millions)                   Fourth Quarter           Full Year
                               ---------------------- -----------------------
                                2007    2006  Change   2007    2006   Change
                                ----    ----  ------   ----    ----   ------
    Meat Products Group         42.4    37.9    12%    90.2    74.4     21%
    Agribusiness Group (i)      (9.1)   (9.0)   (1%)   (7.8)   (2.5)  (217%)
                               ---------------------- -----------------------
    Protein Group               33.3    28.9    15%    82.4    71.9     14%
    Bakery Products Group       24.6    23.3     5%   116.7   100.9     16%
                               ---------------------- -----------------------
                                57.9    52.2    11%   199.1   172.8     15%
                               ---------------------- -----------------------
                               ---------------------- -----------------------

    (i)    Agribusiness Group excludes the results of the animal nutrition
           business that are reported as discontinued operations.
    

    Meat Products Group (value-added processed packaged meats; chilled meal
    entrees and lunch kits; value-added pork, poultry and turkey products;
    and global meat sales.)

    Meat Products Group sales for the fourth quarter declined 13% to
$820 million compared to $942 million last year and for the year declined 8%
to $3.5 billion compared to $3.7 billion last year. This decrease was due
primarily to exit of certain global businesses and currency changes.
    Adjusted Operating Earnings for the fourth quarter increased by 12% to
$42.4 million from $37.9 million last year, reflecting improved earnings from
the fresh pork business, driven by benefits related to the closure of the
Saskatoon and Winnipeg pork processing plants in the second and fourth
quarters of 2007 respectively, and completion of double-shifting front-end
processing at the Brandon processing plant, combined with stronger industry
pork processor margins. Further processed meat products benefited from
increased pricing. These positive factors outweighed the impact of currency
and lower poultry processor margins as increases in live bird costs exceeded
fresh poultry market price increases.
    Adjusted Operating Earnings for the year increased by 21% to
$90.2 million from $74.4 million in 2006, mainly driven by increased returns
in the fresh pork and poultry businesses, benefiting from improved industry
processor margins on average through the year, compared to 2006. The positive
effect of these improvements were further reinforced by improved operating
efficiencies resulting from primary processing plant optimization mentioned
above and the closure of the Company's poultry facility in Atlantic Canada,
which offset the impact of a strengthening Canadian dollar. While price
increases implemented by the further processed meat business managed to offset
rising raw material costs by the end of the year, the lag in the timing of
pricing together with an increased investment in product development and
marketing resulted in lower earnings compared to 2006. The Company has made
significant investments to drive expansion in the chilled meals category, and
over the past year has established market leadership in this higher growth
market segment.
    A cornerstone of the Company's new protein strategy is to significantly
reduce the volume of fresh pork it processes to a level that supports internal
requirements for further processed products, consolidated in one scale plant
in Brandon, Manitoba. Supporting this strategy, the Company double shifted the
front-end processing at Brandon in early September, reaching its target of
75,000 hogs per week during the fourth quarter. In 2007, the Company closed
two pork processing plants in Saskatoon and Winnipeg, which processed a
combined total of approximately 1.7 million hogs per year. The Company will
invest further capital in its Brandon facility in 2008 to expand and double
shift the back end 'cut' operation and proceed with the divestiture of its
primary processing facility in Burlington, Ontario.

    Agribusiness Group (swine production and animal by-products recycling)

    Agribusiness Group sales for the fourth quarter decreased 7% to
$60.5 million from $64.8 million last year, and sales for the year decreased
2% to $241 million from $245 million. This decrease was primarily due to the
restructuring of the hog production operations.
    Adjusted Operating Earnings for the fourth quarter were a loss of
$9.1 million, consistent with the prior year. Significant increases in feed
prices and the continuing rise in the Canadian dollar, compounded by lower hog
prices had a negative impact on hog production margins. Increased earnings
from rendering operations, along with benefits from short-term risk management
programs helped offset these negative factors. Biodiesel production also
contributed to performance benefiting from capital upgrades undertaken in the
year that further enhanced product quality and consistency.
    Adjusted Operating Earnings for the year were a loss of $7.8 million
compared to a loss of $2.5 million in 2006. As noted above, rising feed costs
and a strong Canadian dollar resulted in lower hog producer margins.
Productivity was also affected earlier in the year by an industry-wide
outbreak of circo virus. These impacts were somewhat mitigated by strong
markets for rendered products that tracked rising commodity grain prices.
    In January 2008, the Company sold most of its Ontario hog production
operations and almost all of its hog production investments in Alberta. This,
combined with progress in restructuring its operations in Manitoba, represents
a significant milestone towards achieving the Company's new integrated
business model. This materially completes the Company's exit from Alberta and
Ontario hog production operations and the concentration of its production
assets in Manitoba. The balance of the hog inventory in Ontario and Alberta
will be marketed in the first quarter of 2008. As a result, after the first
quarter of 2008, the annualized number of finished pigs produced by the
Company is expected to reduce to approximately 750,000 hogs compared to the
1.3 million produced in 2007. At the end of 2007, the Company effectively
owned 20% of the hogs that it processed in its facilities.
    In the first quarter of 2008, the Company completed the purchase of
Central By-Products, a rendering business located near London, Ontario. This
acquisition reflects the Company's ongoing commitment to the rendering
business.

    Bakery Products Group (fresh, frozen and branded value-added bakery
    products, including frozen par-baked bakery products; and specialty pasta
    and sauces)

    Bakery Product Group sales for the fourth quarter increased 11% to
$393 million compared to $355 million last year. Sales for the year increased
13% to $1.5 billion. Excluding acquisitions, sales increased by 3% in the
fourth quarter and 5% for the year, reflecting increased volumes in the U.K.
and price increases across all the bakery businesses.
    Adjusted Operating Earnings in the fourth quarter increased 5% to
$24.6 million compared to $23.3 million last year, primarily driven by
increased contributions from acquisitions in the U.K. and improved earnings in
the frozen bakery operations. Significantly higher wheat and dairy costs
impacted margins across all the bakery businesses, however the Company was
able to mitigate these rising input prices, inflationary increases in
manufacturing costs, and an industry-wide volume decline in the fresh bread
category through price increases and cost reduction initiatives. The Company
completed a large warehouse expansion in the quarter at its Roanoke, Virginia
facility that has optimized storage capacity and reduced third party storage
costs and freight.
    Since the beginning of 2008, wheat prices have continued to increase at a
significant rate. In order to offset these impacts, further price increases
during 2008 will be necessary. The timing of such price increases may not
match the increase in wheat prices and other inflationary increases, but over
the medium-term the Company expects to recover these increased costs through
increased prices and operating efficiencies.
    Adjusted Operating Earnings for the year increased by 16% to
$116.7 million compared to $100.9 million in 2006, benefiting from price
increases and contribution from acquisitions. In the U.K., the benefits of
price increases were not sufficient to offset the impact of higher input costs
and investments in promotion and advertising. However, these headwinds were
offset by the positive contribution of acquisitions and organic growth in
bagel and other specialty bakery categories. During the year, the Company
acquired La Fornaia Ltd., a specialty Italian baker and, responding to
customer needs, expanded capacity at its Rotherham bagel facility, positioning
the business to continue its growth in the specialty bakery and bagel markets.
Through these investments, the Company now operates one of the largest
specialty bakeries in the U.K. In the first quarter of 2008, the Company
completed the purchase of Aliments Martel, a Quebec-based manufacturer and
distributor of sandwiches, meals and sweet goods. The Company has growth plans
in the sandwich business, and this acquisition is a significant step in
supporting this strategy. With this acquisition, the Company becomes the
national leader in the Canadian pre-packaged sandwich market.

    Sale of Animal Nutrition Business
    ---------------------------------

    On July 20, 2007, the Company completed the sale of its animal nutrition
business to Nutreco Holding BV for gross proceeds of $525 million. Including
the impact of a $20.7 million goodwill impairment charge relating to the
retained operations of the animal nutrition business and a $5.1 million tax
benefit recorded in earnings in the second quarter, the net after-tax gain on
the sale of the business was $204 million ($1.60 per share).
    Earnings of the animal nutrition business prior to the sale have been
disclosed as discontinued operations. Earnings per share from discontinued
operations in the fourth quarter of 2007 were $0.01 compared to $0.05 last
year; and $1.81 for the year compared to $0.19 for the same period last year,
including the gain on the sale of the business.

    Restructuring and Other Related Costs
    -------------------------------------

    The Company recorded a restructuring charge of $71.9 million in the
fourth quarter and $122.3 million for the year. The charges in the quarter
relate to the impairment of hog production assets classified as held for sale
in Alberta and Ontario, as well as the write down of the remaining hog related
assets in the Agribusiness Group mostly related to those held in Manitoba.
These charges in the quarter have resulted in a revision of Management's
estimates of total restructuring and other related costs for 2006 to 2009
which are now estimated to be between $275 million and $325 million (of which
the cash component is $90 to $110 million). This increase in restructuring and
other related costs is primarily due to the impairment of hog production
assets classified as held for sale in Alberta and Ontario and the impairment
of the remaining long-lived hog production assets. The total amount of
restructuring and other related charges is partly dependent on whether certain
facilities that are non-core to the Company strategy will be sold or closed.
These estimates include restructuring and other related charges for projects
that are anticipated to occur before the end of 2009, for which the plans are
both known to Management and the amounts of restructuring and other related
charges are reasonably quantifiable. These estimates do not include all
restructuring projects that will occur during this time period and may change
as the Company implements its restructuring initiatives. As a result, actual
restructuring and other related costs over the next two years may differ
materially from what is expressed.
    The Company had previously estimated the total restructuring and other
related costs to be between $165 million and $215 million (of which the cash
component was $50 to $75 million).

    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 our objectives and goals, as well as statements
with respect to our beliefs, plans, objectives, expectations, anticipations,
estimates and intentions. 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. Therefore, actual outcomes and results may differ
materially from what is expressed, implied or forecasted in such
forward-looking statements. The Company does not intend, 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.
    These forward-looking statements are based on a variety of factors and
assumptions including, but not limited to: the condition of the Canadian and
United States economies; the rate of appreciation of the Canadian dollar
versus the U.S. dollar and Japanese yen; the availability and saleability of
prices of livestock, raw materials, energy and supplies; product pricing; the
competitive environment and related market conditions; improvement of
operating efficiencies; continued access to capital; the cost of compliance
with environmental and health standards; adverse results from ongoing
litigation; no expected actions of domestic and foreign governments and the
general assumption that none of the risks identified under "Risk Factors" will
materialize. These assumptions have been derived from information currently
available to the Company including information obtained by the Company from
third-party industry analysts.
    Actual results may differ materially from those predicted by such
forward-looking statements. While the Company does not know what impact any of
these differences may have on its business, results of operations, financial
condition and the market price of its securities may be materially adversely
affected. Factors that could cause actual results or outcomes to differ
materially from the results expressed or implied by forward-looking statements
are discussed more fully in the Company's Management Discussion and Analysis
which will be available on SEDAR at www.sedar.com.

    Other Matters
    -------------

    On February 21, 2008, Maple Leaf Foods Inc. declared a dividend of $0.04
per share payable on March 31, 2008 to shareholders of record on March 10,
2008. Unless indicated otherwise in writing at or before the time the dividend
is paid, each dividend paid by the corporation in 2007 or a subsequent year is
an eligible dividend for the purposes of the "Enhanced Dividend Tax Credit
System."

    Maple Leaf Foods Inc. is a leading food processing company, headquartered
in Toronto, Canada. The Company employs approximately 23,000 people at its
operations across Canada and in the United States, the United Kingdom and
Asia. The Company had sales of $5.2 billion in 2007.

    An investor presentation related to the Company's fourth quarter
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 February 21, 2008 to review Maple Leaf Foods' fourth
quarter financial results. To participate in the call, please dial
416-641-6113 or 866-226-1792. For those unable to participate, playback will
be made available an hour after the event at 416-695-5800 / 800-408-3053
(Passcode 3250810 followed by the number sign).
    A webcast presentation of the fourth quarter financial results will also
be available at http://investor.mapleleaf.ca via a link
http://events.startcast.com/events/91/B0024.


    
           Consolidated Interim Financial Statements
           (Expressed in Canadian dollars)

           MAPLE LEAF FOODS INC.
           Three and twelve months ended December 31, 2007 and 2006


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

    -------------------------------------------------------------------------
                                                           As at December 31,
                                                           2007         2006
    -------------------------------------------------------------------------

    ASSETS

    Current assets
      Cash and cash equivalents                     $    28,222  $    64,494
      Accounts receivable                               202,285      201,743
      Inventories                                       351,064      376,216
      Future tax asset - current                         25,409        2,128
      Prepaid expenses and other assets                  16,529       11,158
      Assets held for sale                               10,092      311,172
      ----------------------------------------------------------------------
                                           	     $   633,601  $   966,911

    Investments in associated companies                   1,207       15,499

    Property and equipment                            1,126,727    1,080,293

    Other long-term assets                              303,360      279,001

    Future tax asset - non-current                       22,837       23,464

    Goodwill                                            817,477      829,641

    Other intangibles                                    92,635       80,917

    -------------------------------------------------------------------------
                                                    $ 2,997,844  $ 3,275,726
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    LIABILITIES AND SHAREHOLDERS' EQUITY

    Current liabilities
      Bank indebtedness                             $     9,845  $     9,130
      Accounts payable and accrued charges              550,528      594,685
      Income and other taxes payable                     12,881       18,056
      Current portion of long-term debt                  17,945       81,954
      Liabilities related to assets held for sale             -       74,474
      -----------------------------------------------------------------------
                                                    $   591,199  $   778,299

    Long-term debt                                      855,281    1,185,970

    Future tax liability - non-current                   61,935       29,867

    Other long-term liabilities                         248,448      196,911

    Minority interest                                    79,554       90,237

    Shareholders' equity                              1,161,427      994,442

    -------------------------------------------------------------------------
                                                    $ 2,997,844  $ 3,275,726
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------


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

    -------------------------------------------------------------------------
                                Three months ended       Twelve months ended
                                       December 31,              December 31,
                                 2007         2006         2007         2006
    -------------------------------------------------------------------------
                           (Unaudited)  (Unaudited)

    Sales                 $ 1,273,633  $ 1,361,361  $ 5,209,640  $ 5,324,756

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

    Earnings from
     continuing operations
     before restructuring
     and other related
     costs                $    57,941  $    52,241  $   199,056  $   172,802
    Restructuring and
     other related costs      (71,907)     (43,662)    (122,304)     (63,230)
    -------------------------------------------------------------------------

    Earnings (loss) from
     continuing
     operations               (13,966)       8,579       76,752      109,572
    Other income                2,244          732        4,578        2,647
    -------------------------------------------------------------------------

    Earnings (loss) from
     continuing operations
     before interest and
     income taxes             (11,722)       9,311       81,330      112,219
    Interest expense           21,093       22,611       94,122       90,204
    -------------------------------------------------------------------------

    Earnings (loss) from
     continuing operations
     before income taxes      (32,815)     (13,300)     (12,792)      22,015
    Income taxes              (11,772)       2,763          801       35,799
    -------------------------------------------------------------------------

    Earnings (loss) from
     continuing operations
     before minority
     interest                 (21,043)     (16,063)     (13,593)     (13,784)
    Minority interest           2,695        1,816        9,639        6,208
    -------------------------------------------------------------------------

    Net earnings (loss)
     from continuing
     operations               (23,738)     (17,879)     (23,232)     (19,992)
    Net earnings from
     discontinued
     operations - net
     of income tax              1,666        6,255      230,376       24,517

    -------------------------------------------------------------------------
    Net earnings (loss)
     for the period       $   (22,072) $   (11,624) $   207,144  $     4,525
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    Basic earnings (loss)
     per share
      From continuing
       operations         $     (0.19) $     (0.14) $     (0.18) $     (0.16)
      From discontinued
       operations                0.01         0.05         1.81         0.19
    -------------------------------------------------------------------------
                          $     (0.17) $     (0.09) $      1.63  $      0.04
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    Diluted earnings (loss) per
     share
      From continuing
       operations         $     (0.19) $     (0.14) $     (0.18) $     (0.16)
      From discontinued
       operations                0.01         0.05         1.77         0.19
    -------------------------------------------------------------------------
                          $     (0.17) $     (0.09) $      1.59  $      0.03
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    Weighted average
     number of shares
     (millions)                 127.0        127.0        127.3        127.5

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


    MAPLE LEAF FOODS INC.
    Consolidated Statements of Retained Earnings
    (In thousands of Canadian dollars)
    -------------------------------------------------------------------------
                                             Twelve months ended December 31,
                                                           2007         2006
    -------------------------------------------------------------------------

    Retained earnings, beginning of year            $   204,415  $   231,807
    Net earnings for the year                           207,144        4,525
    Dividends declared $0.16 per share;
     (2006: $0.16 per share)                            (20,775)     (20,387)
    Premium on repurchase of share capital                    -      (11,530)

    -------------------------------------------------------------------------
    Retained earnings, end of year                  $   390,784  $   204,415
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------


    Consolidated Statements of Comprehensive Income (Loss)
    (In thousands of Canadian dollars)

    -------------------------------------------------------------------------
                                Three months ended       Twelve months ended
                                       December 31,              December 31,
                                 2007         2006         2007         2006
    -------------------------------------------------------------------------
                           (Unaudited)  (Unaudited)

    Net earnings (loss)
     for the period       $   (22,072) $   (11,624) $   207,144  $     4,525

    Other comprehensive
     income (loss)

      Change in
       accumulated foreign
       currency
       translation
       adjustment              (2,314)       6,131      (16,036)       8,749
      Change in net
       unrealized
       derivative loss on
       cash flow hedges         4,347            -       22,620            -
    -------------------------------------------------------------------------
                          $     2,033  $     6,131  $     6,584  $     8,749
    -------------------------------------------------------------------------
    Comprehensive income
     (loss)               $   (20,039) $    (5,493) $   213,728  $    13,274
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------


    MAPLE LEAF FOODS INC.
    Consolidated Statements of Cash Flows
    (In thousands of Canadian dollars)
    -------------------------------------------------------------------------
                                Three months ended       Twelve months ended
                                       December 31,              December 31,
                                 2007         2006         2007         2006
    -------------------------------------------------------------------------
    CASH PROVIDED BY
     (USED) IN             (Unaudited)  (Unaudited)

    Operating activities
      Net earnings (loss) $   (23,738) $   (17,880) $   (23,232) $   (19,992)
      Add (deduct) items
       not affecting cash:
        Depreciation and
         amortization          35,477       33,194      141,181      130,736
        Stock-based
         compensation           4,866        3,367       15,340       10,384
        Minority interest       2,695        1,816        9,639        6,208
        Future income
         taxes                (35,274)     (15,774)     (46,290)          75
        Gain on sale of
         property and
         equipment             (2,086)      (1,781)      (2,341)      (2,051)
        Loss (gain) on
         sale of
         investments              (14)          57         (176)         202
      Change in other
       long-term
       receivables             (2,071)       2,460       (1,957)       4,546
      Increase in net
       pension asset          (11,308)     (20,925)     (48,034)     (55,322)
      Asset impairments
       and change in
       restructuring
       provision               69,917        6,810      101,348       20,621
      Other                    16,503        4,604        7,999        7,185
      Change in non-cash
       operating working
       capital                 44,176       48,365      (30,643)       4,827
    -------------------------------------------------------------------------
    Cash provided by
     operating
     activities of
     continuing
     operations           $    99,143  $    44,313  $   122,834  $   107,419
    Cash provided by
     (used in) operating
     activities of
     discontinued
     operations                     -       14,017      (17,086)      24,592
    -------------------------------------------------------------------------
                          $    99,143  $    58,330  $   105,748  $   132,011

    Financing activities
      Dividends paid           (5,384)      (5,081)     (20,775)     (20,387)
      Dividends paid to
       minority interest         (183)        (191)        (801)      (1,602)
      Net increase
       (decrease) in
       long-term debt         (75,935)      85,836     (335,474)     109,680
      Increase in share
       capital                    600        1,454       20,944       15,556
      Shares repurchased
       for cancellation             -            -            -      (23,056)
      Purchase of
       treasury stock         (25,362)           -      (30,054)           -
      Other                       909            -        8,200        2,357
    -------------------------------------------------------------------------
    Cash provided by
     (used in) financing
     activities of
     continuing
     operations           $  (105,355) $    82,018  $  (357,960) $    82,548
    Cash provided by
     (used in) financing
     activities of
     discontinued
     operations                     -            1         (389)         403
    -------------------------------------------------------------------------
                          $  (105,355) $    82,019  $  (358,349) $    82,951

    Investing activities
      Additions to
       property and
       equipment              (66,424)     (60,060)    (236,660)    (155,935)
      Proceeds from sale
       of property and
       equipment                6,668        2,597        9,788        7,605
      Acquisition of
       business - net of
       cash
      Acquired                   (390)     (70,663)     (65,013)     (80,986)
      Proceeds on sale
       of investments               -            -        3,713            -
      Proceeds on
       disposal of
       business                     -            -        5,470            -
      Purchase of Canada
       Bread shares                 -            -       (6,521)           -
      Other                       138        5,125        1,521        1,956
    -------------------------------------------------------------------------
    Cash provided by
     (used in) investing
     activities of
     continuing
     operations           $   (60,008) $  (123,001) $  (287,702) $  (227,360)
    Cash provided by
     (used in) investing
     activities of
     discontinued
     operations                     -       (4,591)     503,316      (12,740)
    -------------------------------------------------------------------------
                          $   (60,008) $  (127,592) $   215,614  $  (240,100)
    Increase (decrease)
     in cash and cash
     equivalents              (66,220)      12,757      (36,987)     (25,138)
    Cash and cash equivalents,
      beginning of period      84,597       42,607       55,364       80,502
    -------------------------------------------------------------------------
    Cash and cash equivalents,
      end of period       $    18,377  $    55,364  $    18,377  $    55,364
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------


    MAPLE LEAF FOODS INC.
    Segmented Financial Information
    (In thousands of Canadian dollars)
    -------------------------------------------------------------------------
                                Three months ended       Twelve months ended
                                       December 31,              December 31,
                                 2007         2006         2007         2006
    -------------------------------------------------------------------------
                           (Unaudited)  (Unaudited)

    Sales
      Meat Products Group $   820,402  $   941,557  $ 3,458,055  $ 3,745,654
      Agribusiness Group       60,449       64,813      240,956      245,438
      Bakery Products
       Group                  392,782      354,991    1,510,629    1,333,664
    -------------------------------------------------------------------------
                          $ 1,273,633  $ 1,361,361  $ 5,209,640  $ 5,324,756
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    Earnings from
     operations, before
     restructuring and
     other related costs
      Meat Products Group $    42,399  $    37,855  $    90,193  $    74,400
      Agribusiness Group       (9,064)      (8,950)      (7,841)      (2,475)
      Bakery Products
       Group                   24,606       23,336      116,704      100,877
    -------------------------------------------------------------------------
                          $    57,941  $    52,241  $   199,056  $   172,802
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    Additions to property
     and equipment
      Meat Products Group $    39,074  $    35,869  $   132,220  $    91,271
      Agribusiness Group        4,652        7,584       15,068       15,210
      Bakery Products
       Group                   22,698       16,607       89,372       49,454
    -------------------------------------------------------------------------
                          $    66,424  $    60,060  $   236,660  $   155,935
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    Depreciation and
     amortization
      Meat Products Group $    16,595  $    16,657  $    68,806  $    66,987
      Agribusiness Group        5,552        4,438       20,536       17,323
      Bakery Products
       Group                   13,330       12,099       51,839       46,426
    -------------------------------------------------------------------------
                          $    35,477  $    33,194  $   141,181  $   130,736
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------


    -------------------------------------------------------------------------
                                                           As at December 31,
                                                           2007         2006
    -------------------------------------------------------------------------

    Total assets
      Meat Products Group                           $ 1,560,244  $ 1,551,502
      Agribusiness Group                                302,999      702,534
      Bakery Products Group                             823,137      810,940
      Non-allocated assets                              311,464      210,750
    -------------------------------------------------------------------------
                                                    $ 2,997,844  $ 3,275,726
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    Goodwill
      Meat Products Group                           $   450,929  $   457,039
      Agribusiness Group                                  2,058       19,885
      Bakery Products Group                             364,490      352,717
    -------------------------------------------------------------------------
                                                    $   817,477  $   829,641
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    





For further information:

For further information: Lynda Kuhn, Senior Vice-President,
Communications & Consumer Relations, (416) 926-2026, www.mapleleaf.com


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