|
Last year was a year of change, a year
of volatility and a year where we laid the
foundation for our future. It was also
a year where we exceeded our financial
targets and accomplished all of our 2007
strategic goals in the midst of a complex
business transformation. We made
remarkable headway in one of the most
unpredictable years the food industry
has ever experienced. Climbing wheat
(up 37%), corn (up 42%) and soy prices
(up 46%) resulted in soaring worldwide
input costs and food inflation; further
strengthening of the Canadian dollar
increased the already monumental
challenges faced by domestic
manufacturing and export industries;
and increased competition in the Canadian
retail grocery sector fuelled intense price
pressure on suppliers to reduce costs.
So how did Maple Leaf perform? In the
midst of turbulent markets and major
transformation in our protein business,
our stock rose 20% in 2007, outperforming
the S&P/TSX Composite Index that rose
7% and the S&P 1500 Food Index that
increased 8%. We achieved 15% growth
in adjusted operating earnings and a 34%
increase in adjusted earnings per share.
While a solid performance, it absolutely
does not reflect our goals and full potential,
nor does it include any benefits to come
from the dramatic changes underway
in our protein business. We continue to
expect this restructuring alone to yield
an incremental $100 million in operating
earnings by the end of 2009, not including
profit growth in our other businesses. So
we are satisfied with our 2007 performance
and very confident about our ability to
step-change shareholder return through
the transformational business changes
that are part of our "Destination 2010".
Here are more details as we look
back on 2007 (all earnings exclude
restructuring and other related costs,
certain non-recurring tax adjustments
and discontinued operations):
- Sales were $5.2 billion compared with
$5.3 billion in 2006
- Adjusted earnings from operations
increased 15% to $199 million
- Adjusted earnings per share increased
to $0.51 from $0.38 last year
- Operating cash flow from continuing
operations increased 14% to $123 million
- Capital expenditures increased
52% to $237 million
- Return on net assets was
6.7% compared to 5.6% last year
- Share price at year end was $14.85;
outperforming the S&P Food Products Index by 14%
|
|
