Maple Leaf Reports 2002 Second Quarter Financial Results; Operating Earnings Up 24%; Earnings Per Share Up 27%.Business Editors TORONTO--(BUSINESS WIRE)--July 24, 2002 Maple Leaf Foods Maple Leaf Foods TSX: MFI is a major Canadian food processing company. The company was originally known as Maple Leaf. It was founded in 1927 as a merger of several major Toronto meat packers, most prominently William Davies Co. Inc. (TSX TSX Toronto Stock Exchange (TSE before April, 2002) TSX Transfer from Stack Pointer to Index TSX True Space Extension :MFI MFI Microfinance Institution MFI Money Flow Index MFI Melt Flow Index MFI Median Family Income MFI Malaria Foundation International MFI Massachusetts Family Institute MFI Multi-port Fuel Injection (automobile) ) today reported its financial results for the second quarter ended June June: see month. 30, 2002. "Maple Leaf maple leaf of Canada. [Flower Symbolism: Jobes, 283] See : Flower Or Plant, National achieved another quarter of solid earnings growth, as we continue to leverage the value of our assets, improve operating performance and shift our operations and sales mix sales mix See product mix. to higher value-added val·ue-add·ed adj. Of or relating to the estimated value that is added to a product or material at each stage of its manufacture or distribution: products," said Michael Michael, archangel Michael (mī`kəl) [Heb.,=who is like God?], archangel prominent in Christian, Jewish, and Muslim traditions. In the Bible and early Jewish literature, Michael is one of the angels of God's presence. H. McCain, President and Chief Executive Officer. "We are particularly pleased with the growth of our Bakery Products Group, which realized a 133% increase in earnings quarter-over-quarter, as well as increased earnings in our Meat Products Group, which more than offset lower earnings in the Agribusiness agribusiness Agriculture operated by business; specifically, that part of a modern national economy devoted to the production, processing, and distribution of food and fibre products and byproducts. Group." In accordance Accordance is Bible Study Software for Macintosh developed by OakTree Software, Inc.[] As well as a standalone program, it is the base software packaged by Zondervan in their Bible Study suites for Macintosh. with recent changes in generally accepted accounting principles The standard accounting rules, regulations, and procedures used by companies in maintaining their financial records. Generally accepted accounting principles (GAAP) provide companies and accountants with a consistent set of guidelines that cover both broad accounting , effective January January: see month. 1, 2002 the Company no longer amortizes goodwill, resulting in a positive impact on 2002 earnings. The effect of this is explained more fully in note 1 to these financial statements. All comparative percentage increases noted here are after taking account of this change. Sales for the second quarter increased 4% to $1.3 billion from $1.2 billion for the same period last year, a positive result considering the substantial decline in many key underlying commodity values. Earnings from operations of $51.3 million increased from $38.9 million last year ($41.4 million before goodwill amortization), an increase of 24%. This increase is principally due to very strong results in the Bakery Products Group and higher Meat Products earnings. Net earnings for the second quarter of $22.6 million ($0.19 per share) increased from $12.8 million ($0.12 per share) in 2001 ($15.0 million or $0.15 per share before goodwill amortization), an increase of 27%. Earnings for the first six months were $39.5 million or $0.33 per share compared to $27.0 million or $0.26 per share last year on the same basis. Other income for the second quarter of $3.9 million compared to $1.0 million for the same period last year, reflecting increased earnings from real estate operations. Interest expense for the quarter of $15.0 million decreased from $17.1 million for the prior year due to lower debt and interest rates. Year-to-date Year-to-date (YTD) The period beginning at the start of the calendar year up to the current date. interest expense was $28.4 million compared to $33.4 million in 2001. The Company's cash flow from operating activities for the second quarter was $ 78.9 million compared to $90.9 million last year, reflecting higher cash earnings, offset by higher investments in working capital. Meat Products Group (branded value-added prepared meat products; fresh, frozen and branded value-added pork pork, flesh of swine prepared as food, one of the principal commodities of the meatpacking industry. Pork has long been a staple food in most of the world, although religious taboos have limited its use, especially among Jews and Muslims. products; fresh, frozen and branded value-added chicken and turkey products; and global food marketing, distribution and trading) Meat Product Group sales Group sales Block sale (of large amounts) of securities to institutional investors. group sales The distribution of a new security issue to institutional clients. for the second quarter decreased 9% to $751 million from $827 million last year. While volumes increased from last year, sales values were impacted by reduced prices for pork and poultry poultry, domesticated fowl kept primarily for meat and eggs; including birds of the order Galliformes, e.g., the chicken, turkey, guinea fowl, pheasant, quail, and peacock; and natatorial (swimming) birds, e.g., the duck and goose. products as a result of low commodity prices. Year-to-date sales of $1.5 billion were consistent with last year. Earnings from operations increased 43% to $14.7 million, compared to $9.1 million for the same period last year ($10.2 million before goodwill amortization). Earnings for the first six months were $27.1 million, an increase of 25% over last year. Maple Leaf Pork continues to benefit from its focus on shifting product and sales mix to increasingly higher value-added products. Consumer Foods earnings also increased in the second quarter, driven in part by market share improvements in its Top Dogs brand of hot dogs, and the success of a new line of Top Dogs MegaBites. Earnings declined in the Maple Leaf Poultry operations, the result of industry-wide margin pressure due to a surplus in supply and lower prices, a market condition that is expected to continue for the balance of the year. Agribusiness Group (research, development and supply of quality livestock livestock Farm animals, with the exception of poultry. In Western countries the category encompasses primarily cattle, sheep, pigs, goats, horses, donkeys, and mules; other animals (e.g., buffalo, oxen, or camels) may predominate in other areas. nutrition nutrition, study of the materials that nourish an organism and of the manner in which the separate components are used for maintenance, repair, growth, and reproduction. Nutrition is achieved in various ways by different forms of life. products and services; pet food; swine swine, name for any of the cloven-hoofed mammals of the family Suidae, native to the Old World. A swine has a rather long, mobile snout, a heavy, relatively short-legged body, a thick, bristly hide, and a small tail. production; and animal by-products Animal by-products are biodegradable wastes consisting of animal carcases, parts of animal carcases, products of animal origin which are not intended for human consumption, includes catering waste (all waste food from restaurants, catering facilities, central kitchens, recycling recycling, the process of recovering and reusing waste products—from household use, manufacturing, agriculture, and business—and thereby reducing their burden on the environment. ) Agribusiness Group sales for the second quarter increased 8% to $241 million compared to $224 million last year, while year-to-date sales were $462 million compared to $425 million last year. Operating earnings Operating Earnings Profits after subtracting expenses such as marketing, cost of goods sold, administration and general operating costs from revenue. Notes: Tax and interest expenses are not subtracted - operating earnings are synonymous with EBIT (earnings before were $17.5 million compared to $22.6 million for the same period last year ($23.0 million before goodwill amortization), a decrease of 24%. Earnings for the first six months were $34.8 million compared to $37.5 million for the prior year. The decrease in profitability was primarily due to lower hog prices, which impacted the Group's hog production operations. However, the Company's Vertical Coordination coordination /co·or·di·na·tion/ (ko-or?di-na´shun) the harmonious functioning of interrelated organs and parts. co·or·di·na·tion n. 1. The harmonious adjustment or interaction of parts. strategy offset this impact with increased profitability at the Maple Leaf Pork and Maple Leaf Consumer Foods operations. Earnings in the feed business declined slightly due to unsettled spring weather and a slow down in feeding rates. Bakery Products Group (fresh, frozen and branded value-added bakery products, including frozen par-baked bakery products; and specialty pasta While the only basic difference between these names is the shape of the pasta, each pasta is typically matched with a particular sauce based on cooking time, consistency, ability to hold sauce, ease of eating, etc. and sauces) Bakery Product Group sales for the second quarter of $287 million increased 65% from $174 million for the same period last year and year-to-date sales increased to $552 million from $338 million last year. The increase was principally due to strong performance in fresh and frozen bakery operations and significant contributions from Multi-Marques Multi-Marques Inc. is Quebec’s largest bakery and the second largest in Canada since its merger with Canada Bread. Multi-Marques Inc. employs more than 1 700 people throughout seven bakeries in Laval, Beauport, Lévis, Quebec, Montreal and St-Côme-de-Beauce. Inc. (Quebec Quebec, city, Canada Quebec, Fr. Québec, city (1991 pop. 167,517), provincial capital, S Que., Canada, at the confluence of the St. Lawrence and St. Charles rivers. ) and the New York New York, state, United States New York, Middle Atlantic state of the United States. It is bordered by Vermont, Massachusetts, Connecticut, and the Atlantic Ocean (E), New Jersey and Pennsylvania (S), Lakes Erie and Ontario and the Canadian province of Bagel Company (United Kingdom), both of which were purchased in the second half of 2001 and continue to exceed expectations. In addition, on April 11, 2002, the Company acquired the remaining shares of Ben's Bakery Limited in Atlantic Canada Canada (kăn`ədə), independent nation (2001 pop. 30,007,094), 3,851,787 sq mi (9,976,128 sq km), N North America. Canada occupies all of North America N of the United States (and E of Alaska) except for Greenland and the French islands of , which also contributed to increased sales and profitability quarter-over-quarter. Excluding the effect of these acquisitions, sales for the quarter increased by 8%. Earnings from operations for the second quarter of $19.2 million increased from $7.2 million for the same period last year ($8.3 million before goodwill amortization), an increase of 133%. Earnings for the first six months were $31.2 million, a 101% increase from last year. On July July: see month. 18, 2002 Canada Bread announced that it had acquired the Olafson's Baking baking: see cooking. baking Process of cooking by dry heat, especially in an oven. Baked products include bread, cookies, pies, and pastries. Company, Inc. of Delta, British Columbia Delta is a district municipality in British Columbia, Canada. Located south of Richmond, it is bordered by the Fraser River to the north, the United States (Point Roberts, Washington) to the south and the city of Surrey to the east. . With annual sales of approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. $30 million, Olafson's specializes in the production of premium value added Value Added The enhancement a company gives its product or service before offering the product to customers. Notes: This can either increase the products price or value. bakery products, which are highly complementary with Canada Bread's existing product line. The acquisition of Olafson's will expand the range of products Canada Bread can offer its national customers and provides a strong platform for growth. The Company declared de·clare v. de·clared, de·clar·ing, de·clares v.tr. 1. To make known formally or officially. See Synonyms at announce. 2. To state emphatically or authoritatively; affirm. 3. a dividend of $0.04 per share payable on September September: see month. 30, 2002 to shareholders of record on September 20, 2002. Maple Leaf Foods Inc. is a leading Canadian Canadian (kənā`dēən), river, 906 mi (1,458 km) long, rising in NE New Mexico. and flowing E across N Texas and central Oklahoma into the Arkansas River in E Oklahoma. food processing Food processing is the set of methods and techniques used to transform raw ingredients into food for consumption by humans or animals. The food processing industry utilises these processes. company committed to delivering quality food products to consumers around the world. Headquartered in Toronto Toronto (tərŏn`tō), city (1998 est pop. 2,400,000), provincial capital, S Ont., Canada, on Lake Ontario. Toronto is the largest city in Canada and since the 1970s has been one of the fastest-changing cities in North America, experiencing , Canada, the Company employs more than 14,000 people at its operations across Canada Across Canada was an afternoon program that formerly aired on The Weather Network. The segment ran from early 1999 until mid 2002. The show ran from 3:00PM ET until 7:00 PM ET. , and in the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. , Europe Europe (y  r`əp), 6th largest continent, c.4,000,000 sq mi (10,360,000 sq km) including adjacent islands (1992 est. pop. 512,000,000). and Asia. Maple Leaf Foods Inc. reported sales of $4.8 billion in
2001.
A conference call will be held at 3:00 p.m. (Toronto time) on July 24, 2002 to review Maple Leaf Foods' financial results for the second quarter ended June 30, 2002. The call will be hosted by Michael H. McCain, President & Chief Executive Officer; Tom P. Muir, Chief Financial Officer and Michael H. Vels, Executive Vice-President vice president or vice-pres·i·dent n. Abbr. VP 1. An officer ranking next below a president, usually empowered to assume the president's duties under conditions such as absence, illness, or death. 2. , Finance. To participate in the call, please dial in to 1-888-740-8770. For those unable to participate playback Playback could mean:
Maple Leaf Foods Inc. Notes to Consolidated Financial Statements (For the quarters ended June 30, 2002 and June 30, 2001) (Tabular amounts in thousands of Canadian dollars except for per share amounts) 1. Significant Accounting Policies The unaudited interim consolidated financial statements Consolidated Financial Statements The combined financial statements of a parent company and its subsidiaries. Notes: Because consolidated financial statements present an aggregated look at the financial position of a parent and its subsidiaries, they enable you to gauge should be read in conjunction with the annual consolidated financial statements for the year ended December December: see month. 31, 2001. These unaudited interim consolidated financial statements have been prepared in accordance with Canadian generally accepted accounting principles using the same accounting policies as were applied in the consolidated financial statements for the year ended December 31, 2001 except for the following: (a) Business Combinations, Goodwill and Other Intangible Assets Intangible Asset An asset that is not physical in nature. Notes: Examples are things like copyrights, patents, intellectual property, and goodwill. These are the opposite of tangible assets. In September 2001, the Canadian Institute of Chartered Accountants The Canadian Institute of Chartered Accountants (CICA) is the umbrella body for the Chartered Accountant profession in Canada and Bermuda. Membership of the CICA totals 70,000 Chartered Accountants and 8,500 students. ("CICA CICA Competition In Contracting Act of 1984 (USA) CICA Canadian Institute of Chartered Accountants CICA Competition In Contracting Act CICA Criminal Injuries Compensation Authority (UK) ") issued Handbook
This article is about reference works. For the subnotebook computer, see .
1. A reduction in a company's stated capital. 2. The total capital that is less than the par value of the company's capital stock. Notes: 1. This is usually reduced because of poorly estimated losses or gains. 2. at least annually. The Company has adopted these new standards as of January 1, 2002 and has discontinued dis·con·tin·ue v. dis·con·tin·ued, dis·con·tin·u·ing, dis·con·tin·ues v.tr. 1. To stop doing or providing (something); end or abandon: amortization of all existing goodwill. Effective July 1, 2001, goodwill arising on business combinations completed after June 30, 2001 was not amortized. In accordance with the transitional provisions of CICA Handbook Section 3062, Goodwill and Other Intangible Assets, the Company has completed the first step of the transitional goodwill impairment test for all reporting units. The results of this test have indicated there is no impairment to the book value of goodwill. Effective January 1, 2002, the Company had unamortized goodwill of $402.6 million which is no longer being amortized. This change in accounting policy is not applied retroactively ret·ro·ac·tive adj. Influencing or applying to a period prior to enactment: a retroactive pay increase. [French rétroactif, from Latin and the amounts presented for prior periods have not been restated for this change. To enable consistent comparison to prior periods, the following selected pro-forma financial information is provided for 2001, assuming no goodwill amortization for 2001:
Quarter ended Six months ended
June 30, June 30,
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2002 2001 2002 2001
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Earnings from operations as
reported $ 51,341 $ 38,916 $ 93,047 $ 69,750
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Add back goodwill
amortization 2,501 5,032
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Pro-forma earnings from
operations $ 51,341 $ 41,417 $ 93,047 $ 74,782
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Pro-forma net earnings
for the period $ 22,597 $ 15,030 $ 39,487 $ 27,044
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Earnings per share as
reported (basic and
diluted) $0.19 $0.12 $0.33 $0.21
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Pro-forma earnings per
share (basic and diluted) $0.19 $0.15 $0.33 $0.26
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(b) Stock-based compensation and other stock-based payments Effective January 1, 2002, the Company adopted the new CICA Handbook Section 3870, which requires that a fair value based method of accounting be applied to certain types of stock options. The new standard requires that for stock option awards such as those awarded by the Company, the effect on reported net earnings be disclosed on a pro-forma basis in the notes to the financial statements Notes to the financial statements A detailed set of notes immediately following the financial statements in an annual report that explain and expand on the information in the financial statements. as if the Company had accounted for these stock option awards under the fair value method. During the second quarter of 2002, the Company granted 2,208,500 stock options (2,297,500 year to date) that call for settlement by the issuance of common shares at a weighted average exercise price per share of $14.73. The fair value of the options issued in the quarter was determined using the Black-Scholes option pricing model option pricing model A mathematical formula for determining the price at which an option should trade. The model expresses the value of an option as a function of the value of the underlying asset, length of time until maturity, exercise price, yields on with the following assumptions: a weighted-average risk free interest rate of 4.9%, a weighted-average expected dividend yield Expected dividend yield Total amount of dividends received during the life of a futures contract or total dividends received for holding a particular stock one year. See: Current yield. of 1.1%, a weighted-average volatility Volatility 1. A statistical measure of the tendency of a market or security to rise or fall sharply within a period of time. 2. A variable in option pricing formulas that denotes the extent to which the return of the underlying asset will fluctuate between now and the factor of the market price of the Company's shares of 38.7%, and a weighted-average expected option life of 4.2 years. The estimated fair value of the options issued during the quarter was $7.9 million ($8.3 million year to date). For the purpose of the pro-forma disclosure, the estimated fair value of the options issued is amortized to income over the vesting Vesting The process by which employees accrue non-forfeitable rights over employer contributions that are made to the employee's qualified retirement plan account. Notes: period of the related options. For the three months ended June 30, 2002, the effect of these stock option awards, had they been charged to earnings during the second quarter of 2002, would have been an expense of $0.1 million ($0.1 million year to date) with no impact to diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. earnings per common share. On a comparative basis, during the second quarter of 2001, the Company granted 2,230,400 stock options (2,365,400 for the first 6 months of 2001) that call for settlement by the issuance of common shares at a weighted average exercise price per share of $10.88. The estimated fair value of the options issued during the second quarter of 2001 was $6.5 million ($6.7 million for the first 6 months of 2001). For the three months ended June 30, 2001, the effect of these stock option awards, had they been charged to earnings during the second quarter of 2001, would have had no impact on diluted earnings per common share. (c) Foreign Currency Translation A revision to section 1650 of the CICA Handbook eliminated deferral deferral - Waiting for quiet on the Ethernet. and amortization of foreign currency translation differences resulting from the translation of long-term Long-term Three or more years. In the context of accounting, more than 1 year. long-term 1. Of or relating to a gain or loss in the value of a security that has been held over a specific length of time. Compare short-term. monetary assets and liabilities Monetary assets and liabilities Assets and liabilities with contractual payoffs. denominated in foreign currencies. All such translation differences are now charged directly to income. The Company adopted the revision retroactively, effective January 1, 2002, without restating the financial statements of any prior period. Application of the recommendation would not have materially affected net earnings reported in 2001. In total, the adoption of the standard results in a cumulative reduction to retained earnings Retained Earnings The percentage of net earnings not paid out in dividends, but retained by the company to be reinvested in its core business or to pay debt. It is recorded under shareholders equity on the balance sheet. at January 1, 2002 of $1.5 million. (d) Comparative figures Certain comparative figures have been reclassified to conform with the financial statement presentation adopted in the current year. 2. Acquisitions On October October: see month. 12, 2001 Canada Bread Company Limited, ("Canada Bread"), a 68% owned subsidiary of the Company, acquired the remaining 75% interest in Multi-Marques Inc., to now hold 100%. On April 11, 2002, Canada Bread acquired the remaining 40% interest in Ben's Limited, a bakery business in Atlantic Canada, to now hold 100% for $12.9 million. Canada Bread has not yet completed the determination of fair values of the individual assets and liabilities acquired or its restructuring restructuring - The transformation from one representation form to another at the same relative abstraction level, while preserving the subject system's external behaviour (functionality and semantics). and integration plans for the operations acquired. Accordingly, the allocation The apportionment or designation of an item for a specific purpose or to a particular place. In the law of trusts, the allocation of cash dividends earned by a stock that makes up the principal of a trust for a beneficiary usually means that the dividends will be treated as of the purchase cost to the assets and liabilities acquired is preliminary and will change further as restructuring plans are finalized See finalization. . No restructuring costs related to the acquisitions, other than those incurred to date, have been accrued ac·crue v. ac·crued, ac·cru·ing, ac·crues v.intr. 1. To come to one as a gain, addition, or increment: interest accruing in my savings account. 2. in the preliminary purchase accounting included in these financial statements, or accrued with respect to any restructuring of existing Canada Bread operations that may result from integration plans, when finalized. On July 18, 2002 Canada Bread acquired Olafson's Baking Company Inc. of Delta, British Columbia with annual sales of approximately $30 million. Olafson's specializes in the production of premium value added bakery products. 3. Accounts Receivable accounts receivable n. the amounts of money due or owed to a business or professional by customers or clients. Generally, accounts receivable refers to the total amount due and is considered in calculating the value of a business or the business' problems in paying Under revolving securitization Securitization The process of creating a financial instrument by combining other financial assets and then marketing them to investors. Notes: Mortgage backed securities are a perfect example of securitization. May also be spelled as "securitisation. programs, the Company has sold, with limited recourse Limited recourse A term describing a type of loan in which the lender has limited or no claim against the parent company if the collateral is insufficient to repay the debt. See:Nonrecourse. , certain of its trade accounts receivable to financial institutions. The Company retains servicing responsibilities and assumes limited recourse obligations for delinquent delinquent 1) adj. not paid in full amount or on time. 2) n. short for an underage violator of the law as in juvenile delinquent. DELINQUENT, civil law. He who has been guilty of some crime, offence or failure of duty. receivables Receivables An asset designation applicable to all debts, unsettled transactions or other monetary obligations owed to a company by its debtors or customers. Receivables are recorded by a company's accountants and reported on the balance sheet, and they and include all debts owed . At June 30, 2002, trade accounts receivable amounting to $172.2 million (June 30, 2001 - $127.0 million) had been sold under these programs. 4. Other Income
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Quarter Ended Six months Ended
June 30, June 30,
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2002 2001 2002 2001
Earnings from associated companies $ 134 $ 202 $ 296 $ 457
Dividends received 25 -- 39 --
Gain on sale of investments, net 25 979
Gain (loss) on real estate
operations 3,521 (220) 3,839 2,593
Gain (loss) on sale of property &
equipment 52 (39) 129 (126)
Other 184 1,068 254 1,609
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$ 3,941 $ 1,011 $ 5,536 $ 4,533
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Maple Leaf Foods Inc.
Consolidated Statements of Earnings
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In thousands of
Canadian dollars,
except per share Quarter ended Six Months ended
amounts June 30, June 30
(Unaudited) 2002 2001 2002 2001
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Sales $1,279,595 $1,224,564 $2,502,773 $2,279,465
Earnings from
operations 51,341 38,916 93,047 69,750
Other income (note 4) 3,941 1,011 5,536 4,533
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Earnings before
interest and taxes 55,282 39,927 98,583 74,283
Interest expense 15,020 17,095 28,376 33,428
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Earnings before
income taxes 40,262 22,832 70,207 40,855
Income taxes 14,375 8,952 25,215 16,089
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Earnings before
minority interest 25,887 13,880 44,992 24,766
Minority interest 3,290 1,115 5,505 2,282
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Net earnings for the
period $22,597 $12,765 $39,487 $22,484
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Earnings per share
(basic and fully
diluted) $0.19 $0.12 $0.33 $0.21
Dividends per share
declared 0.04 0.04 0.08 0.08
Weighted average
number of shares
(millions) 112.5 95.0 112.5 95.0
The accompanying notes to the consolidated financial statements
are an integral part of this statement.
Maple Leaf Foods Inc.
Consolidated Balance Sheets
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In thousands of Canadian As at
dollars As at June 30, December 31,
2002 2001 2001
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(Unaudited) (Unaudited)
ASSETS
Current assets:
Cash $51,580 $64,317 $52,611
Accounts receivable (note 3) 238,402 231,201 248,064
Inventories 248,518 234,421 231,918
Prepaid expenses and
other assets 22,075 23,142 14,725
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560,575 553,081 547,318
Investments in associated
companies 52,194 89,553 58,303
Property and equipment 770,764 682,987 795,932
Other long-term assets 154,913 170,454 161,961
Future tax asset 12,970 20,150 14,602
Goodwill and other
intangibles 425,923 328,002 402,636
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$1,977,339 $1,844,227 $1,980,752
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LIABILITIES AND
SHAREHOLDERS' EQUITY
Current liabilities:
Bank indebtedness $- $16,927 $-
Accounts payable and
accrued charges 471,087 421,499 488,226
Income and other taxes
payable 26,235 22,892 34,573
Current portion of
long-term debt 21,027 14,698 23,556
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518,349 476,016 546,355
Long-term debt 616,321 776,608 627,890
Future tax liability 57,638 44,489 51,417
Other long-term
liabilities 7,139 5,805 7,315
Minority interest 87,236 79,889 88,059
Shareholders' equity 690,656 461,420 659,716
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$1,977,339 $1,844,227 $1,980,752
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The accompanying notes to the consolidated financial statements
are an integral part of this statement.
Maple Leaf Foods Inc.
Consolidated Statements of Cash Flows
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In thousands of Canadian Quarter ended Six months ended
dollars June 30, June 30,
(Unaudited) 2002 2001 2002 2001
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CASH PROVIDED BY (USED IN):
Operating activities
Net earnings for the
period $22,597 $12,765 $39,487 $22,484
Add (deduct) items not
affecting cash:
Depreciation 24,133 22,775 48,262 42,703
Amortization - 2,644 - 5,298
Minority interest 3,290 1,115 5,505 2,282
Future income taxes 3,663 3,747 6,076 3,703
Undistributed earnings of
associated companies (20) (1,886) (588) 7,546
Loss (gain) on sale of
property and equipment (52) 39 (129) 126
Other 3,449 (6,139) (1,703) 1,677
Change in other long-term
receivables 9,684 2,708 12,567 2,965
Change in non-cash
operating working capital 12,188 53,085 (37,989) (31,974)
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78,932 90,853 71,488 56,810
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Financing activities
Dividends paid (4,507) (3,798) (8,999) (7,602)
Dividends paid to
minority interest (437) (439) (1,918) (955)
Increase (decrease) in
long-term debt (41,489) (38,451) (14,098) 67,796
Convertible debenture
interest paid (1,369) (1,369) (2,739) (2,739)
Increase in share capital 3,608 196 6,543 675
Shares repurchased for
cancellation - (293) - (1,511)
Other 159 298 (800) 594
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(44,035) (43,856) (22,011) 56,258
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Investing activities
Additions to property and
equipment (25,301) (21,362) (43,871) (28,367)
Proceeds from sale of
property and equipment 187 7,248 2,610 7,327
Purchase of net assets of
businesses (15,944) - (15,944) (42,836)
Change in other
investments, net 5,478 (2,341) 6,697 (2,003)
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(35,580) (16,455) (50,508) (65,879)
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Increase (decrease) in
cash and cash equivalents (683) 30,542 (1,031) 47,189
Cash and cash
equivalents, beginning of
period 52,263 16,848 52,611 201
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Cash and cash
equivalents, end of
period 51,580 47,390 51,580 47,390
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The accompanying notes to the consolidated financial statements
are an integral part of this statement.
Maple Leaf Foods Inc.
Consolidated Statements of Retained Earnings/Deficit
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In thousands of Canadian dollars Six months ended June 30,
(Unaudited) 2002 2001
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Retained earnings (deficit),
beginning of period
as previously reported $3,310 $(32,889)
Adjustment to reflect change in
accounting for foreign currency
translation (note 1 (c)) $(1,493)
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As restated $1,817 $(32,889)
Net earnings for the period 39,487 22,484
Dividends declared ($0.08 per
share; 2001 - $0.08 per share) (8,999) (7,602)
Premium on repurchase of share
capital - (811)
Convertible debenture charge (2,647) (2,516)
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Retained earnings (deficit), end of
period $29,658 $(21,334)
---------------------------------------------------------------------
---------------------------------------------------------------------
The accompanying notes to the consolidated financial statements
are an integral part of this statement.
Maple Leaf Foods Inc.
Segmented Financial Information
-------------------------------------------------------------------
Pro-forma
for the
In thousands of Canadian Quarter ended quarter ended
dollars, June 30, June 30,
(Unaudited) 2002 2001 2001 (i)
-------------------------------------------------------------------
Sales
Meat Products Group $751,076 $827,047 $827,047
Agribusiness Group 241,225 223,609 223,609
Bakery Products Group 287,294 173,908 173,908
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$1,279,595 $1,224,564 $1,224,564
-------------------------------------------------------------------
-------------------------------------------------------------------
Earnings from operations
Meat Products Group $14,655 $9,115 $10,215
Agribusiness Group 17,482 22,567 22,950
Bakery Products Group 19,204 7,234 8,252
-------------------------------------------------------------------
$51,341 $38,916 $41,417
-------------------------------------------------------------------
-------------------------------------------------------------------
Capital expenditures
Meat Products Group $8,242 $12,497 $12,497
Agribusiness Group 10,288 3,319 3,319
Bakery Products Group 6,771 5,546 5,546
-------------------------------------------------------------------
$25,301 $21,362 $21,362
-------------------------------------------------------------------
-------------------------------------------------------------------
Depreciation and amortization
Meat Products Group $9,574 $12,821 $11,721
Agribusiness Group 4,181 4,465 4,082
Bakery Products Group 10,378 8,133 7,115
-------------------------------------------------------------------
$24,133 $25,419 $22,918
-------------------------------------------------------------------
-------------------------------------------------------------------
-------------------------------------------------------------------
Pro-forma
for the
six months
In thousands of Canadian Six months ended ended
dollars, June 30 June 30,
(Unaudited) 2002 2001 2001 (i)
-------------------------------------------------------------------
Sales
Meat Products Group $1,488,430 $1,516,449 $1,516,449
Agribusiness Group 461,902 425,495 425,495
Bakery Products Group 552,441 337,521 337,521
-------------------------------------------------------------------
$2,502,773 $2,279,465 $2,279,465
-------------------------------------------------------------------
-------------------------------------------------------------------
Earnings from operations
Meat Products Group $27,110 $19,511 $21,716
Agribusiness Group 34,780 36,757 37,540
Bakery Products Group 31,157 13,482 15,526
-------------------------------------------------------------------
$93,047 $69,750 $74,782
-------------------------------------------------------------------
-------------------------------------------------------------------
Capital expenditures
Meat Products Group $12,846 $13,973 $13,973
Agribusiness Group 17,722 5,856 5,856
Bakery Products Group 13,303 8,538 8,538
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$43,871 $28,367 $28,367
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-------------------------------------------------------------------
Depreciation and amortization
Meat Products Group $19,636 $22,862 $20,657
Agribusiness Group 8,186 8,988 8,205
Bakery Products Group 20,440 16,151 14,107
-------------------------------------------------------------------
$48,262 $48,001 $42,969
-------------------------------------------------------------------
-------------------------------------------------------------------
-------------------------------------------------------------------
As at As at
In thousands of Canadian dollars, June 30, December,
2002 2001 2001
-------------------------------------------------------------------
(Unaudited) (Unaudited)
Total assets
Meat Products Group $699,226 $708,591 $724,137
Agribusiness Group 488,520 452,502 457,862
Bakery Products Group 631,872 462,818 627,017
Non-allocated assets 157,721 220,316 171,736
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$1,977,339 $1,844,227 $1,980,752
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-------------------------------------------------------------------
(i) Effective January 1, 2002, in accordance with changes in
generally accepted accounting principles, the Company no
longer amortizes goodwill. The pro-forma effect of this
change, as if goodwill had not been amortized in 2001, is
presented above.
The accompanying notes to the consolidated financial statements
are an integral part of this statement.
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