Maple Leaf Foods, a key player in the food and beverage industry, announced plans to merge its meat and plant-based protein businesses following a successful year in its meat-free division. The company achieved its goal of delivering neutral or better adjusted EBITDA within 18 months in its plant protein division.
Despite a decrease in plant protein sales in the fourth quarter and for the full year, the company remains optimistic. Sales in the fourth quarter were C$36.5m, a decrease of 9.1% compared to the previous year. For 2023, sales slid 13.2% to C$147m. However, CFO David Smales reported that the plant division achieved an adjusted EBITDA target of C$95,000 for the quarter, compared to a loss of C$20.4m the previous year.
While the plant-protein division still experienced an adjusted EBITDA loss of C$33m for the full year, this was a significant improvement from the previous year’s loss of C$105m. CEO Curtis Frank emphasized the company’s focus on simplifying operations and expanding its business in both Canada and the US.
Frank highlighted the strategic benefits of merging the meat and plant divisions, including leveraging customer relationships, distribution networks, and marketing efforts. The company sees potential long-term gains from this integration, despite short-term challenges.
In terms of meat protein sales, Maple Leaf Foods faced some setbacks in the final quarter of 2023 due to market dislocations and consumer demand challenges. Despite these obstacles, meat protein sales grew to C$1.16bn, with an adjusted EBITDA of C$122m, marking a 60.3% increase from the previous year.
Looking at the company’s overall performance, total sales grew by 2.7% to C$4.87bn, with an adjusted EBITDA margin of 8.8%. Although Maple Leaf Foods reported a net loss of C$125m for the year, this was an improvement from the previous year’s net loss of $311.9m.
As Maple Leaf Foods continues to navigate the evolving food and drink consumer trends, the company remains committed to driving growth and delivering value to its stakeholders in the competitive food and beverage industry.
