The culmination of this effort is a detailed strategic blueprint for delivering significant and sustainable value to our shareholders, now and over the next five years, by significantly reducing our cost structure.
Adjusting our business model and our performance to a new normal of parity currency with the United States is a journey – a challenging one; but an exciting and rewarding one. Our Board and Management have spent the past two years evaluating a wide range of strategic alternatives for maximizing shareholder value and plotting the best course forward for Maple Leaf Foods. This process saw us visit over 20 leading plants around the world; perform a detailed, line-by-line assessment of potential savings by individual product category; engage over 60 internal and external experts; conduct over 20 different reviews by our senior management team; and undertake six separate Board reviews of our strategic direction. We have done our homework!
The culmination of this effort is a detailed strategic blueprint for delivering significant and sustainable value to our shareholders, now and over the next five years, by significantly reducing our cost structure. It is a plan that was built from the bottom up and evaluated in the context of our peers’ performance in the food industry, which typically deliver EBITDA margins in the 10% to 15% range. It is a plan rooted in specific cost reductions, not aspirational growth targets. Our plan will see Maple Leaf deliver margins of 9.5% by 2012 and 12.5% margins by 2015, compared to 7.3% in 2010, and returns on assets well in excess of the Company’s cost of capital.