Maple Leaf Foods Reports Second Quarter 2024 Financial Results
TSX: MFI
www.mapleleaffoods.com
Investor Contact
investor.relations@mapleleaf.com
Media Contact
media.hotline@mapleleaf.com
Maple Leaf records year-over-year Adjusted EBITDA growth of 37% to
Company on track to meet its 2024 priorities and execute its transformative spin-off of pork business
"In the second quarter of 2024, we made excellent progress in executing our strategic playbook, delivering Adjusted EBITDA of
"We remain laser-focused on executing our priorities for 2024, and we are not taking our eye off the longer-term goals we have set for ourselves" continued
"Looking ahead, we are on a clear path to unleashing the potential of our business by separating into two independent public companies, each primed for growth and positioned to be a leader in its field," stated
Second Quarter 2024 Highlights
- Adjusted Earnings Before Interest, Taxes, Depreciation and Amortization ("EBITDA")(i) grew to
$141 million , a 37% increase from the second quarter of last year, with Adjusted EBITDA margin increasing from 8.1% to 11.2% for the same period. - Sales were
$1,261 million for the second quarter, compared to$1,266 million for the same period last year. Sales inPrepared Foods increased approximately 1%. WithinPrepared Foods , prepared meats increased 3.2% which was partially offset by declines in poultry and plant protein of 3.9% and 2.5% respectively, compared to the same period in the prior year. Sales in the Pork operating unit decreased by 4.2% compared to last year. - Loss for the second quarter of 2024 was
$26 million ($0.21 per basic share) compared to a loss of$54 million ($0.44 loss per basic share) last year. - Capital expenditures in the second quarter of 2024 were
$16 million compared to$53 million in the second quarter last year, consistent with the Company's focus of disciplined capital management, and reflecting the completion of its large capital projects. - Net Debt(i) was
$1,723 million , with Net Debt to trailing four quarters Adjusted EBITDA of 3.4x, an improvement from 3.7x at the end of the first quarter. - Free cash flow(i) improved to
$27 million , an increase of$103 million from the same quarter last year.
Unlocking Value through the Creation of Two Independent Public Companies
- On
July 9, 2024 ,Maple Leaf Foods announced plans to separate into two independent public companies through the spin-off of its pork business. The Company expects that this transaction will be completed in 2025. An update to the previously provided management's preliminary estimates of the relative size of the two companies reflecting the last twelve months endedJune 30, 2024 can be found in the section titled Management's Estimates on the Pork business spin-off, and related Non-IFRS measures, in this news release.
Outlook
- For the full year 2024, the Company expects:
- Low single-digit revenue growth
- Adjusted EBITDA margin expansion over 2023
- To generate increased free cash flow and delever the balance sheet
- Total capital expenditures this year are expected to be in the range of
$120 -$140 million , largely focused on maintenance capital and optimization of its existing network
(i) |
Refer to the section titled Non-IFRS Financial Measures in this news release. |
Financial Highlights
|
As at or for the |
|
As at or for the |
|||||||||
Measure (i) (Unaudited) |
Three months ended |
|
Six months ended |
|||||||||
|
2024 |
|
2023 |
|
Change |
|
2024 |
|
2023 |
|
Change |
|
Sales(ii) |
|
$ 1,260.9 |
|
$ 1,265.8 |
|
(0.4) % |
|
$ 2,414.1 |
|
$ 2,436.9 |
|
(0.9) % |
(Loss) Earnings |
|
$ (26.2) |
|
$ (53.7) |
|
51.2 % |
|
$ 25.4 |
|
$ (111.4) |
|
nm(iv) |
Basic (Loss) Earnings per Share |
|
$ (0.21) |
|
$ (0.44) |
|
52.3 % |
|
$ 0.21 |
|
$ (0.92) |
|
nm(iv) |
Adjusted Operating Earnings(iii) |
|
$ 78.1 |
|
$ 45.9 |
|
70.3 % |
|
$ 131.1 |
|
$ 65.2 |
|
101.1 % |
Adjusted Earnings (Loss) per Share(iii) |
|
$ 0.18 |
|
$ 0.00 |
|
nm(iv) |
|
$ 0.22 |
|
$ (0.12) |
|
nm(iv) |
Adjusted EBITDA(iii) |
|
$ 140.9 |
|
$ 103.1 |
|
36.7 % |
|
$ 257.3 |
|
$ 178.4 |
|
44.2 % |
Adjusted EBT(iii) |
|
$ 34.4 |
|
$ 6.7 |
|
413.4 % |
|
$ 44.8 |
|
$ (7.3) |
|
nm(iv) |
Free Cash Flow(iii) |
|
$ 27.0 |
|
$ (76.3) |
|
nm(iv) |
|
$ 100.7 |
|
$ (64.0) |
|
nm(iv) |
Net Debt(iii) |
|
|
|
|
|
|
|
|
|
|
|
4.7 % |
(i) |
All financial measures in millions of dollars except Basic and Adjusted Earnings per Share. |
(ii) |
Quarterly amounts for 2023 have been adjusted to eliminate new sales agreements entered into during the year that contained an expectation of repurchase, which had previously been reported as external sales. |
(iii) |
Refer to the section titled Non-IFRS Financial Measures in this news release. |
(iv) |
Not meaningful. |
Sales for the second quarter of 2024 were
Year-to-date sales for 2024 were
As a result of improvements in pork markets, reduction of start-up expenses at new facilities, and improvement in operational efficiencies, all of which were partially offset by increased Selling, General and Administrative expenses ("SG&A"), unrealized mark to market valuation of biological assets and derivatives, and higher interest expense, Loss for the second quarter of 2024 of
Year-to-date earnings for 2024 were
Adjusted Operating Earnings for the second quarter of 2024 were
Year-to-date Adjusted Operating Earnings for 2024 were
Adjusted Earnings Before Taxes ("Adjusted EBT") for the second quarter of 2024 were
Year-to-date Adjusted EBT for 2024 were
Free Cash Flow for the second quarter of 2024 was
Year-to-date Free Cash Flow for 2024 was $100.7 million compared to Free Cash Flow of negative
Net Debt as at
For further discussion on key operational metrics and results refer to the section titled Operating Review.
Note: Several items are excluded from the discussions of underlying earnings performance as they are not representative of ongoing operational activities. Refer to the section entitled Non-IFRS Financial Measures at the end of this news release for a description and reconciliation of all non-IFRS financial measures. |
Operating Review
During the first quarter of 2024, the Company announced an update to its strategic blueprint (the "Blueprint") that reflects the progress it has made toward achieving its Purpose and Vision and establishes the roadmap for the next chapter for how
As part of delivering on these objectives, the Company combined its Meat and Plant protein businesses and aligned its organizational structure to focus on growth potential in key markets and drive operational efficiencies. As a result in the first quarter of 2024,
As a consolidated protein company,
The following table summarizes the Company's sales, gross profit, SG&A, Adjusted Operating Earnings, Adjusted EBITDA, Adjusted EBITDA Margin, and Adjusted EBT for the three and six months ended
|
Three months ended |
Six months ended |
||||||
($ millions except where noted otherwise) (Unaudited) |
|
2024 |
|
2023 |
|
2024 |
|
2023 |
Sales (i) |
|
$ 1,260.9 |
|
$ 1,265.8 |
|
$ 2,414.1 |
|
$ 2,436.9 |
Gross profit (loss) |
|
$ 131.2 |
|
$ 93.6 |
|
$ 357.5 |
|
$ 170.0 |
Selling, general and administrative expenses |
|
$ 116.6 |
|
$ 106.2 |
|
$ 226.7 |
|
$ 208.9 |
Adjusted Operating Earnings(ii) |
|
$ 78.1 |
|
$ 45.9 |
|
$ 131.1 |
|
$ 65.2 |
Adjusted EBITDA(ii) |
|
$ 140.9 |
|
$ 103.1 |
|
$ 257.3 |
|
$ 178.4 |
Adjusted EBITDA Margin(i)(ii) |
|
11.2 % |
|
8.1 % |
|
10.7 % |
|
7.3 % |
Adjusted EBT (i) |
|
$ 34.4 |
|
$ 6.7 |
|
$ 44.8 |
|
$ (7.3) |
|
|
(i) |
Quarterly amounts for 2023 have been adjusted to eliminate new sales agreements entered into during the year that contained an expectation of repurchase, which had previously been reported as external sales. |
(ii) |
Refer to the section titled Non-IFRS Financial Measures in this news release. |
Sales for the second quarter decreased 0.4% to
Year-to-date sales for 2024 decreased 0.9% to
Gross profit for the second quarter increased to
Year-to-date gross profit for 2024 was
SG&A expenses for the second quarter were
Year-to-date SG&A expenses for 2024 were
Adjusted Operating Earnings for the second quarter were $78.1 million, compared to
Year-to-date Adjusted Operating Earnings for 2024 were
Adjusted EBITDA for the second quarter were
Year-to-date Adjusted EBITDA for 2024 were
Adjusted EBT for the second quarter were
Year-to-date Adjusted EBT were
Other Matters
On
Conference Call
A conference call will be held at 9:00 a.m. ET on
A webcast of the second quarter conference call will also be available at: https://www.mapleleaffoods.com/investors/events-and-presentations/
The Company's full unaudited condensed consolidated interim financial statements ("Consolidated Interim Financial Statements") and related Management's Discussion and Analysis are available on the Company's website and on SEDAR+ at www.sedarplus.ca.
An investor presentation related to the Company's second quarter financial results is available at www.mapleleaffoods.com under Presentations and Webcasts on the Investors page.
Outlook
The Company recognizes that macro-economic factors and global conflict continue to define the current operating environment, contributing to higher interest rates, inflation, supply chain tensions, and pressures on agricultural, commodity and foreign exchange markets. As a result, consumers and businesses alike are adapting their behaviour which impacts demand and product mix. The Company leverages its data-driven insights to stay close to these dynamics, and it is confident in the resilience of its brands, business model and strategy to manage through prevailing economic conditions.
Earlier this year,
With this focus, the Company expects to achieve an overall consolidated Adjusted EBITDA margin target of 14% to 16% in normal market conditions. Prior to this year, this Adjusted EBITDA margin target applied to the previous Meat Protein segment but now applies on a consolidated protein basis.
For the full year 2024, the Company expects:
- Low single-digit revenue growth
- Adjusted EBITDA margin expansion from 2023, supported by the benefits of:
- Profitable growth of its leading portfolio of protein brands
- Returns from investments in the London Poultry Plant and the
Bacon Centre of Excellence - Leadership in sustainable meats
- Driving operational and cost efficiencies
- To generate increased Free Cash Flow and delever its balance sheet by:
- Improving margins and overall profitability as outlined above
- Generating the targeted returns on its capital investments at the London Poultry Plant and the
Bacon Centre of Excellence , including reducing start-up expenses, maximizing efficiencies and onboarding new customers - Exercising disciplined capital management, with total capital expenditures this year expected to be in the range of
$120 -$140 million , largely focused on maintenance capital and optimization of its existing network
On
Non-IFRS Financial Measures
The Company uses the following non-IFRS measures: Adjusted Operating Earnings, Adjusted Earnings per Share, Adjusted EBITDA, Adjusted EBITDA Margin, Adjusted EBT,
Adjusted Operating Earnings, Adjusted EBITDA, Adjusted EBITDA Margin and Adjusted EBT
Adjusted Operating Earnings, Adjusted EBITDA, Adjusted EBITDA Margin and Adjusted EBT are non-IFRS measures used by Management to evaluate financial operating results. Adjusted Operating Earnings is defined as earnings before other income, income taxes and interest expense adjusted for items that are not considered representative of ongoing operational activities of the business and certain items where the economic impact of the transactions will be reflected in earnings in future periods when the underlying or related asset is sold or transferred. Adjusted EBITDA is defined as Adjusted Operating Earnings plus depreciation and intangible asset amortization, adjusted for items included in other expense that are considered representative of ongoing operational activities of the business. Adjusted EBITDA Margin is calculated as Adjusted EBITDA divided by sales. Adjusted EBT is used annually by the Company to evaluate its performance and is a component of calculating bonus entitlements under the Company's short term incentive plan. It is defined as Adjusted EBITDA plus interest income, less depreciation and amortization, and interest expense.
The table below provides a reconciliation of earnings (loss) before income taxes as reported under IFRS in the Consolidated Interim Financial Statements to Adjusted Operating Earnings, Adjusted EBITDA and Adjusted EBT for the three and six months ended
|
Three months ended |
Six months ended |
||
($ millions)(i) |
2024 |
2023 |
2024 |
2023 |
Earnings (loss) before income taxes |
$ (32.5) |
$ (63.7) |
$ 41.3 |
$ (133.7) |
Interest expense and other financing costs |
43.6 |
37.6 |
85.7 |
69.2 |
Other expense (income) |
(3.5) |
2.6 |
(2.3) |
6.9 |
Restructuring and other related costs |
6.9 |
11.0 |
6.2 |
18.8 |
Earnings (loss) from operations |
$ 14.5 |
$ (12.6) |
$ 130.8 |
$ (38.9) |
Start-up expenses from |
4.4 |
33.8 |
15.8 |
68.5 |
Change in fair value of biological assets |
52.5 |
27.5 |
(16.7) |
28.7 |
Unrealized and deferred (gain) loss on derivative contracts |
6.8 |
(2.8) |
1.1 |
6.8 |
Adjusted Operating Earnings |
$ 78.1 |
$ 45.9 |
$ 131.1 |
$ 65.2 |
Depreciation and amortization(v) |
63.7 |
59.7 |
128.6 |
117.4 |
Items included in other income (expense) representative of ongoing operations(iii) |
(0.9) |
(2.5) |
(2.4) |
(4.1) |
Adjusted EBITDA |
$ 140.9 |
$ 103.1 |
$ 257.3 |
$ 178.4 |
Adjusted EBITDA Margin(iv) |
11.2 % |
8.1 % |
10.7 % |
7.3 % |
Interest expense and other financing costs |
(43.6) |
(37.6) |
(85.7) |
(69.2) |
Interest income |
0.8 |
0.8 |
1.8 |
0.8 |
Depreciation and amortization |
(63.7) |
(59.7) |
(128.6) |
(117.4) |
Adjusted EBT |
$ 34.4 |
$ 6.7 |
$ 44.8 |
$ (7.3) |
(i) |
Totals may not add due to rounding. |
(ii) |
Start-up expenses are temporary costs as a result of operating new facilities that are or were previously classified as |
(iii) |
Primarily includes certain costs associated with sustainability projects, gains and losses on the impairment and sale of long-term assets, legal settlements, gains and losses on investments, and other miscellaneous expenses. |
(iv) |
Quarterly amounts for 2023 have been adjusted to eliminate new sales agreements entered into during the year that contained an expectation of repurchase, which had previously been reported as external sales. |
(v) |
Depreciation included in start-up expenses is excluded from this line. |
Adjusted Earnings per Share
Adjusted Earnings per Share, a non-IFRS measure, is used by Management to evaluate financial operating results. It is defined as basic earnings per share and is adjusted on the same basis as Adjusted Operating Earnings. The table below provides a reconciliation of basic earnings per share as reported under IFRS in the Consolidated Interim Financial Statements to Adjusted Earnings per Share for the three and six months ended
($ per share) (Unaudited) |
Three months ended |
Six months ended |
||||||
2024 |
2023 |
2024 |
2023 |
|||||
Basic (loss) earnings per share |
|
$ (0.21) |
|
$ (0.44) |
|
$ 0.21 |
|
$ (0.92) |
Restructuring and other related costs(i) |
|
0.04 |
|
0.08 |
|
0.04 |
|
0.14 |
Items included in other expense not considered representative of ongoing operations(ii) |
|
(0.03) |
|
0.01 |
|
(0.02) |
|
0.02 |
Start-up expenses from |
|
0.03 |
|
0.21 |
|
0.10 |
|
0.42 |
Change in fair value of biological assets |
|
0.31 |
|
0.17 |
|
(0.12) |
|
0.18 |
Change in unrealized and deferred fair value on derivatives |
|
0.04 |
|
(0.02) |
|
0.01 |
|
0.04 |
Adjusted Earnings per Share |
|
$ 0.18 |
|
$ 0.00 |
|
$ 0.22 |
|
$ (0.12) |
|
|
(i) |
Includes per share impact of restructuring and other related costs, net of tax. |
(ii) |
Primarily includes legal fees and settlements, gains or losses on investment property, and transaction related costs, net of tax. |
(iii) |
Start-up expenses are temporary costs as a result of operating new facilities that are or have been classified as |
($ thousands) (Unaudited) |
|
2023 |
Property and equipment and intangibles at |
|
$ 2,663,985 |
Other capital and intangible assets at |
|
2,654,419 |
|
|
$ 9,566 |
Additions |
|
8,822 |
|
|
$ 18,388 |
Additions |
|
18,896 |
|
|
$ 37,284 |
Other capital and intangible assets at |
|
2,598,055 |
Property and equipment and intangibles at |
|
$ 2,635,339 |
|
|
|
|
|
$ 36,589 |
|
|
(i) |
Other capital and intangible assets consists of property and equipment and intangibles that do not meet the definition of |
(ii) |
As at |
(ii) |
|
(iv) |
Assumed to be fully funded by debt to the extent that the Company has Net Debt outstanding. |
Net Debt
The following table reconciles Net Debt and Net Debt to trailing four quarters Adjusted EBITDA to amounts reported under IFRS in the Company's Consolidated Interim Financial Statements as at
($ thousands) (Unaudited) |
|
As at |
||
|
2024 |
|
2023 |
|
Cash and cash equivalents |
|
$ 158,381 |
|
$ 156,859 |
Current portion of long-term debt |
|
$ (300,371) |
|
$ (398,394) |
Long-term debt |
|
(1,581,093) |
|
(1,565,822) |
Total debt |
|
|
|
|
Net Debt |
|
|
|
|
Adjusted EBITDA for the six months ended |
|
$ 257,310 |
|
$ 178,430 |
Trailing four quarters Adjusted EBITDA(i) |
|
$ 506,468 |
|
$ 310,411 |
Net Debt to trailing four quarters Adjusted EBITDA |
|
3.4 |
|
5.8 |
|
|
(i) |
Trailing four quarters includes Q3 2023, Q4 2023, Q1 2024 and Q2 2024 for 2024; and Q3 2022, Q4 2022, Q1 2023 and Q2 2023 for 2023. |
Free Cash Flow
Free Cash Flow, a non-IFRS measure, is used by Management to evaluate cash flow after investing in the maintenance of the Company's asset base. It is defined as cash provided by operations, less
($ thousands) (Unaudited) |
Three months ended |
Six months ended |
|||||
|
2024 |
2023 |
|
2024 |
|
2023 |
|
Cash provided by (used in) operating activities |
|
$ 45,496 |
$ (57,004) |
|
$ 132,821 |
|
$ (21,290) |
|
|
(18,250) |
(19,070) |
|
(31,686) |
|
(42,178) |
Interest paid and capitalized related to Maintenance |
|
(220) |
(252) |
|
(483) |
|
(486) |
Free Cash Flow |
|
$ 27,026 |
$ (76,326) |
|
$ 100,652 |
|
$ (63,954) |
(i) |
|
Return on Net Assets ("RONA")
RONA is calculated by dividing tax effected earnings from operations (adjusted for items which are not considered representative of the underlying operations of the business) by average monthly net assets. Net assets are defined as total assets (excluding cash and deferred tax assets) less non-interest bearing liabilities (excluding deferred tax liabilities). Management believes that RONA is an appropriate basis upon which to evaluate long-term financial performance.
Forward-Looking Statements
This document contains, and the Company's oral and written public communications often contain, "forward-looking information" within the meaning of applicable securities law. These statements are based on current expectations, estimates, projections, beliefs, judgements and assumptions based on information available at the time the applicable forward-looking statement was made and in light of the Company's experience combined with its perception of historical trends. Such statements include, but are not limited to, statements with respect to objectives and goals, in addition to statements with respect to beliefs, plans, targets, goals, objectives, expectations, anticipations, estimates, and intentions. Forward-looking statements are typically identified by words such as "anticipate", "continue", "estimate", "expect", "may", "will", "project", "should", "could", "would", "believe", "plan", "intend", "design", "target", "undertake", "view", "indicate", "maintain", "explore", "entail", "schedule", "objective", "strategy", "likely", "potential", "outlook", "aim", "propose", "goal", and similar expressions suggesting future events or future performance. These statements are not guarantees of future performance and involve assumptions, risks and uncertainties that are difficult to predict.
By their nature, forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause actual results or events to differ materially from those anticipated in such forward-looking statements. The Company believes the expectations reflected in the forward-looking statements are reasonable, but no assurance can be given that these expectations will prove to be correct and such forward-looking statements should not be unduly relied upon.
Specific forward-looking information in this document may include, but is not limited to, statements with respect to:
- timing, approvals, expected structure, expected benefits, risks, and tax implications associated with the proposed spin-off of the Pork business announced on
July 9, 2024 (the "Spin-Off"); - the anticipated future financial performance of the businesses following the Spin-Off, including post separation business structure and the ability of each company to execute their respective business and sustainability strategies;
- assumptions about the economic environment, including the implications of inflationary pressures on customer and consumer behaviour, supply chains, global conflicts and competitive dynamics;
- expected future cash flows and the sufficiency thereof, sources of capital at attractive rates, future contractual obligations, future financing options, renewal of credit facilities, compliance with credit facility covenants, and availability of capital to fund growth plans, operating obligations and dividends;
- future performance, including future financial objectives, goals and targets, category growth analysis, expected capital spend and expected SG&A expenditures, global pork market dynamics,
Japan export market margin outlook, labour markets, inflationary pressures (including the ability to price for inflation); - potential for a recurrence of a cybersecurity incident on the Company's systems, business and operations, as well as the ability to mitigate the financial and operational impacts, the success of remediation and recovery efforts, the implications of data breaches, and other ongoing risks associated with cybersecurity;
- the execution of the Company's business strategy, including the development and expected timing of business initiatives, brand expansion and repositioning, plant protein category investment and performance, market access in
China andJapan , capital allocation decisions (including investment in share repurchases under the NCIB) and investment in potential growth opportunities and the expected returns associated therewith; - the impact of international trade conditions and markets on the Company's business, including access to markets, global conflict and other social, economic and political factors that affect trade;
- implications associated with the spread of foreign animal disease (such as African Swine Fever ("ASF")) and other animal diseases such as Avian Influenza;
- competitive conditions and the Company's ability to position itself competitively in the markets in which it competes;
- capital projects, including planning, construction, estimated expenditures, schedules, approvals, expected capacity, in-service dates and anticipated benefits of construction of new facilities and expansions of existing facilities;
- the Company's dividend policy, including future levels and sustainability of cash dividends, the tax treatment thereof and future dividend payment dates;
- the impact of commodity prices and foreign exchange impacts on the Company's operations and financial performance, including the use and effectiveness of hedging instruments;
- operating risks, including the execution, monitoring and continuous improvement of the Company's food safety programs, animal health initiatives, cost reduction initiatives, and service levels (including service level penalties);
- the implementation, cost and impact of environmental sustainability initiatives, the ability of the Company to achieve its sustainability objectives, changing climate and sustainability laws and regulation, changes in customer and consumer expectations related to sustainability matters, as well as the anticipated future cost of remediating environmental liabilities;
- the adoption of new accounting standards and the impact of such adoption on the financial position of the Company;
- expectations regarding pension plan performance, including future pension plan assets, liabilities and contributions; and
- developments and implications of actual or potential legal actions.
Various factors or assumptions are typically applied by the Company in drawing conclusions or making the forecasts, projections, predictions or estimations set out in the forward-looking statements. These factors and assumptions are based on information currently available to the Company, including information obtained by the Company from third-party sources and include but are not limited to the following:
- expectations and assumptions concerning the timing and completion of the proposed spin-off of the Pork business announced on
July 9, 2024 ; - expectations regarding the adaptations in operations, supply chain, customer and consumer behaviour, economic patterns (including but not limited to global pork markets), foreign exchange rates, international trade dynamics and access to capital, including possible presence or absence of structural changes associated with the economic recovery since the pandemic and global conflicts;
- the competitive environment, associated market conditions and market share metrics, category growth or contraction, the expected behaviour of competitors and customers and trends in consumer preferences;
- the success of the Company's business strategy and the relationship between pricing, inflation, volume and sales of the Company's products;
- prevailing commodity prices (especially in pork and feed markets), interest rates, tax rates and exchange rates;
- potential impacts related to cybersecurity matters, including security costs, the potential for a future incident, the risks associated with data breaches, the availability of insurance, the effectiveness of remediation and prevention activities, third party activities, ongoing impacts, customer, consumer and supplier responses and regulatory considerations;
- the economic condition of and the sociopolitical dynamics between
Canada , theU.S. ,Japan andChina , and the ability of the Company to access markets and source ingredients and other inputs in light of global sociopolitical disruption, and the ongoing impact of global conflicts on inflation, trade and markets; - the spread of foreign animal disease (including ASF and Avian Influenza), preparedness strategies to manage such spread, and implications for all protein markets;
- the availability of and access to capital to fund future capital requirements and ongoing operations;
- expectations regarding participation in and funding of the Company's pension plans;
- the availability of insurance coverage to manage certain liability exposures;
- the extent of future liabilities and recoveries related to legal claims;
- prevailing regulatory, tax and environmental laws; and
- future operating costs and performance, including the Company's ability to achieve operating efficiencies and maintain sales volumes, turnover of inventories and turnover of accounts receivable.
Readers are cautioned that these assumptions may prove to be incorrect in whole or in part. The Company's actual results may differ materially from those anticipated in any forward-looking statements.
Factors that could cause actual results or outcomes to differ materially from the results expressed, implied, or projected in the forward-looking statements contained in this document include, among other things, risks associated with the following:
- the spin-off of the Pork business not proceeding as expected (within the expected timeline or at all), including as a result of the conditions of the transaction not being satisfied,
- the spin-off of the Pork business not delivering the intended benefits, including the ability of the separated companies to each succeed as a standalone publicly trading company;
- unanticipated effects of the announcement and potential spin-off on the market price for the Company's securities or the financial performance of the Company;
- the results of each of the separated companies' execution of their respective business plans, the degree to which benefits are realized or not and the timing to realize those benefits, including the implications on the financial results of each;
- presence or absence of adaptations or structural changes arising since the economic recovery following the pandemic which may have implications for the operations and financial performance of the Company, as well the ongoing implications for macro socio-economic trends and global conflict;
- macro economic trends, including inflation, consumer behaviour, recessionary indicators, labour availability and labour market dynamics and international trade trends (including global pork markets);
- the results of the Company's execution of its business plans, the degree to which benefits are realized or not, and the timing associated realizing those benefits, including the implications on cash flow;
- competition, market conditions, and the activities of competitors and customers, including the expansion or contraction of key categories, inflationary pressures, pork market dynamics and
Japan export margins; - cybersecurity and maintenance and operation of the Company's information systems, processes and data, recovery, restoration and long term impacts of the cybersecurity event, the risk of future cybersecurity events, actions of third parties, risks of data breaches, effectiveness of business continuity planning and execution, and availability of insurance;
- the health status of livestock, including the impact of potential pandemics;
- international trade and access to markets and supplies, as well as social, political and economic dynamics, including global conflicts;
- operating performance, including manufacturing operating levels, fill rates and penalties;
- availability of and access to capital, and compliance with credit facility covenants;
- decisions respecting the return of capital to shareholders;
- the execution of capital projects and investment maintenance capital;
- food safety, consumer liability and product recalls;
- climate change, climate regulation and the Company's sustainability performance;
- strategic risk management;
- acquisitions and divestitures;
- fluctuations in the debt and equity markets;
- fluctuations in interest rates and currency exchange rates;
- pension assets and liabilities;
- cyclical nature of the cost and supply of hogs and the competitive nature of the pork market generally;
- the effectiveness of commodity and interest rate hedging strategies;
- impact of changes in the market value of the biological assets and hedging instruments;
- the supply management system for poultry in
Canada ; - availability of plant protein ingredients;
- intellectual property, including product innovation, product development, brand strategy and trademark protection;
- consolidation of operations and focus on protein;
- the use of contract manufacturers;
- reputation;
- weather;
- compliance with government regulation and adapting to changes in laws;
- actual and threatened legal claims;
- consumer trends and changes in consumer tastes and buying patterns;
- environmental regulation and potential environmental liabilities;
- consolidation in the retail environment;
- employment matters, including complying with employment laws across multiple jurisdictions, the potential for work stoppages due to non-renewal of collective agreements, recruiting and retaining qualified personnel, reliance on key personnel and succession planning;
- pricing of products;
- managing the Company's supply chain;
- changes in International Financial Reporting Standards and other accounting standards that the Company is required to adhere to for regulatory purposes; and
- other factors as set out under the heading "Risk Factors" in the Company's Management Discussion and Analysis for the year ended
December 31, 2023 .
The Company cautions readers that the foregoing list of factors is not exhaustive.
Readers are further cautioned that some of the forward-looking information, such as statements concerning future capital expenditures, Adjusted EBITDA Margin expansion, and the Company's ability to achieve its financial targets or projections may be considered to be financial outlooks for purposes of applicable securities legislation. These financial outlooks are presented to evaluate potential future earnings and anticipated future uses of cash flows and may not be appropriate for other purposes. Readers should not assume these financial outlooks will be achieved.
More information about risk factors can be found under the heading "Risk Factors" in the Company's Annual Management's Discussion and Analysis for the year ended
All forward-looking statements included herein speak only as of the date hereof. Unless required by law, the Company does not undertake any obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. All forward-looking statements contained herein are expressly qualified by this cautionary statement.
Management's Estimates on the Pork business spin-off, and related Non-IFRS measures
The following table presents management's preliminary estimates of certain financial information regarding the new
Management believes that these preliminary estimates are useful in providing an indication of the relative size of the businesses upon separation. Each of these figures is expected to be refined prior to the separation, with full financial details to be presented in the prospectus and management information circular to be filed in connection with the transaction.
|
|
Last twelve months ended June 30, 2024 |
|
|||||||||
(in millions of Canadian dollars) (unaudited) |
|
New Pork |
|
|
|
|
|
Eliminations |
|
|
Consolidated
|
|
Sales |
|
$ 1,661 |
(ii) |
|
$ 3,562 |
(iii) |
|
$ (378) |
(iv) |
|
$ 4,845 |
(v) |
Adjusted EBITDA |
|
110 |
(vi) |
|
396 |
(vii) |
|
— |
|
|
506 |
(v),(viii) |
Adjusted EBITDA Margin (ix) |
|
6.6 % |
|
|
11.1 % |
|
|
— % |
|
|
10.5 % |
|
Estimate of potential impact of |
|
|
|
|
|
|
|
|
|
|
|
|
Pro Forma Adjusted EBITDA (xi) |
|
~110 |
|
|
~390 |
|
|
|
|
|
|
|
Pro Forma Adjusted EBITDA margin (xii) |
|
~7% |
|
|
~11% |
|
|
|
|
|
|
|
Estimate of potential market normalization impact(xiii) |
|
~80-85 |
|
|
|
|
|
|
|
|
|
|
Pro Forma normalized Adjusted EBITDA (xiv) |
|
~190 |
|
|
|
|
|
|
|
|
|
|
Pro Forma normalized Adjusted EBITDA Margin (xv) |
|
~11% |
|
|
|
|
|
|
|
|
|
|
|
|
Note: |
|
i. |
Refers to the business that will be retained after the separation by |
|
|
ii. |
Represents management's preliminary estimate of sales (both to |
|
|
iii. |
Represents management's preliminary estimate of sales attributable to the business that will be retained by |
|
|
iv. |
Primarily represents management's preliminary estimate of sales from the new |
|
|
v. |
Calculated by adding the previously reported results for the year ended |
|
|
vi. |
Represents management's preliminary estimate of the portion of consolidated Adjusted EBITDA attributable to the new |
|
|
vii. |
Represents management's preliminary estimate of the portion of consolidated Adjusted EBITDA attributable to |
|
|
viii. |
For a definition of Adjusted EBITDA (consolidated), and a reconciliation of Adjusted EBITDA (consolidated) for the periods described in note (iv) above to consolidated net income for such periods, see the Company's MD&A filed on SEDAR and SEDAR+ for the year ended |
|
|
ix. |
Defined as Adjusted EBITDA divided by Sales. This metric is subject to change and is expected to be refined prior to the separation in the same manner as the metrics from which this metric is derived, as noted above. |
|
|
x. |
Represents management's preliminary estimate of the potential impact on Adjusted EBITDA of the new |
|
|
xi |
Defined as Adjusted EBITDA plus management's preliminary estimate of the potential impact of the separation described in, and subject to the qualifications described in, note (10) above. |
|
|
xii. |
Defined as Pro Forma Adjusted EBITDA, as described in note (xi) above divided by Sales. This metric is subject to change and is expected to be refined prior to the separation in the same manner as the metrics from which this metric is derived, as noted above. |
|
|
xiii. |
Presented for illustrative purposes only, based on management estimates and assumptions, to indicate what the potential impact on Pro Forma Adjusted EBITDA may have been if market conditions during the period presented had reflected normal market conditions, defined as the 5-year pre-pandemic (2015 – 2019) average ("Normal Market Conditions"). Actual market conditions during the period presented were materially different from Normal Market Conditions, and there can be no assurance that actual Pro Forma Adjusted EBITDA would have been impacted in the manner shown if Normal Market Conditions had existed during the period presented, or that actual future market conditions will reflect Normal Market Conditions. This metric is not intended to be indicative of potential financial results for any future period. |
|
|
xiv. |
Defined as Pro Forma Adjusted EBITDA, as described in note (xi) above, plus management's preliminary estimate of the potential impact if market conditions during the period presented had reflected Normal Market Conditions, subject to the qualifications described in note (xiii) above. This metric is presented for illustrative purposes only and is not intended to be indicative of potential financial results for any future period. |
|
|
xv. |
Defined as Pro Forma normalized Adjusted EBITDA, as described in note (xiv) above, divided by Sales. This metric is presented for illustrative purposes only and is based on management estimates and assumptions. This metric is subject to change and is expected to be refined prior to the separation in the same manner as the metrics from which this metric is derived, as noted above. Actual market conditions during the period presented were materially different from Normal Market Conditions, and there can be no assurance that actual Pro Forma Adjusted EBITDA Margin would have been impacted in the manner shown if Normal Market Conditions had existed during the period presented, or that actual future market conditions will reflect Normal Market Conditions. This metric is not intended to be indicative of potential financial results for any future period. |
Adjusted EBITDA, Pro Forma Adjusted EBITDA, and Pro Forma normalized Adjusted EBITDA, and related margins, as presented in the table above, are non-IFRS metrics and do not have a standardized meaning prescribed by IFRS. Consequently, they may not be comparable to similarly titled measures presented by other publicly traded companies and should not be construed as an alternative to other financial measures determined in accordance with IFRS.
About
Maple Leaf Foods is a leading protein company responsibly producing food products under leading brands including Maple Leaf®, Maple Leaf Prime®, Maple Leaf Natural Selections®, Schneiders®, Schneiders® Country Naturals®, Mina®,
Consolidated Interim Balance Sheets
(In thousands of Canadian dollars) |
As at |
As at |
As at 2023 |
|||
ASSETS |
|
|
|
|
|
|
Cash and cash equivalents |
|
$ 158,381 |
|
$ 156,859 |
|
$ 203,363 |
Accounts receivable |
|
184,300 |
|
205,930 |
|
183,798 |
Notes receivable |
|
44,886 |
|
48,159 |
|
33,220 |
Inventories |
|
580,472 |
|
523,377 |
|
542,392 |
Biological assets |
|
124,688 |
|
111,796 |
|
114,917 |
Income taxes recoverable |
|
62,761 |
|
69,521 |
|
88,896 |
Prepaid expenses and other assets |
|
35,203 |
|
36,786 |
|
44,865 |
Assets held for sale |
|
27,438 |
|
11,204 |
|
— |
Total current assets |
|
$ 1,218,129 |
|
|
|
$ 1,211,451 |
Property and equipment |
|
2,186,520 |
|
2,285,314 |
|
2,251,710 |
Right-of-use assets |
|
171,692 |
|
150,211 |
|
154,610 |
Investments |
|
16,112 |
|
22,869 |
|
15,749 |
Investment property |
|
34,744 |
|
5,289 |
|
57,144 |
Employee benefits |
|
116,800 |
|
49,699 |
|
26,785 |
Other long-term assets |
|
22,271 |
|
9,601 |
|
22,336 |
Deferred tax asset |
|
42,504 |
|
41,450 |
|
40,854 |
|
|
477,353 |
|
477,353 |
|
477,353 |
Intangible assets |
|
343,457 |
|
350,025 |
|
345,129 |
Total long-term assets |
|
$ 3,411,453 |
|
|
|
$ 3,391,670 |
Total assets |
|
$ 4,629,582 |
|
|
|
$ 4,603,121 |
LIABILITIES AND EQUITY |
|
|
|
|
|
|
Accounts payable and accruals |
|
$ 543,792 |
|
$ 528,481 |
|
$ 548,444 |
Current portion of provisions |
|
9,673 |
|
23,837 |
|
9,846 |
Current portion of long-term debt |
|
300,371 |
|
398,394 |
|
400,735 |
Current portion of lease obligations |
|
40,544 |
|
37,749 |
|
38,031 |
Income taxes payable |
|
2,351 |
|
1,600 |
|
2,382 |
Other current liabilities |
|
24,986 |
|
17,998 |
|
32,974 |
Total current liabilities |
|
$ 921,717 |
|
|
|
$ 1,032,412 |
Long-term debt |
|
1,581,093 |
|
1,565,822 |
|
1,550,080 |
Lease obligations |
|
157,550 |
|
137,029 |
|
142,286 |
Employee benefits |
|
60,796 |
|
64,251 |
|
64,196 |
Provisions |
|
1,998 |
|
2,281 |
|
2,041 |
Other long-term liabilities |
|
1,167 |
|
928 |
|
1,124 |
Deferred tax liability |
|
330,232 |
|
223,190 |
|
296,203 |
Total long-term liabilities |
|
$ 2,132,836 |
|
|
|
$ 2,055,930 |
Total liabilities |
|
$ 3,054,553 |
|
|
|
$ 3,088,342 |
Shareholders' equity |
|
|
|
|
|
|
Share capital |
|
$ 886,876 |
|
$ 859,046 |
|
$ 873,477 |
Retained earnings |
|
640,589 |
|
671,870 |
|
597,429 |
Contributed surplus |
|
6,773 |
|
— |
|
3,227 |
Accumulated other comprehensive income |
|
44,222 |
|
30,150 |
|
47,829 |
|
|
(3,431) |
|
(7,183) |
|
(7,183) |
Total shareholders' equity |
|
$ 1,575,029 |
|
|
|
$ 1,514,779 |
Total liabilities and equity |
|
$ 4,629,582 |
|
|
|
$ 4,603,121 |
Consolidated Interim Statements of (Loss) Earnings
(In thousands of Canadian dollars, except share amounts) (Unaudited) |
Three months ended |
Six months ended |
||||||
|
2024 |
|
2023(i) |
|
2024 |
|
2023(i) |
|
|
|
|
|
|
|
|
|
|
Sales |
|
|
|
|
|
|
|
|
Cost of goods sold |
|
1,129,723 |
|
1,172,245 |
|
2,056,608 |
|
2,266,865 |
Gross profit |
|
$ 131,155 |
|
$ 93,595 |
|
$ 357,495 |
|
$ 170,042 |
Selling, general and administrative expenses |
|
116,649 |
|
106,184 |
|
226,682 |
|
208,897 |
Earnings (loss) before the following: |
|
$ 14,506 |
|
$ (12,589) |
|
$ 130,813 |
|
$ (38,855) |
Restructuring and other related costs |
|
6,893 |
|
11,026 |
|
6,168 |
|
18,775 |
Other (income) expense |
|
(3,492) |
|
2,579 |
|
(2,335) |
|
6,874 |
Earnings (loss) before interest and income taxes |
|
$ 11,105 |
|
$ (26,194) |
|
$ 126,980 |
|
$ (64,504) |
Interest expense and other financing costs |
|
43,637 |
|
37,554 |
|
85,720 |
|
69,157 |
(Loss) earnings before income taxes |
|
$ (32,532) |
|
$ (63,748) |
|
$ 41,260 |
|
$ (133,661) |
Income tax (recovery) expense |
|
(6,359) |
|
(10,070) |
|
15,882 |
|
(22,279) |
(Loss) earnings |
|
$ (26,173) |
|
$ (53,678) |
|
$ 25,378 |
|
$ (111,382) |
|
|
|
|
|
|
|
|
|
Earnings (loss) per share attributable to common shareholders: |
|
|
|
|
|
|
|
|
Basic (loss) earnings per share |
|
$ (0.21) |
|
$ (0.44) |
|
$ 0.21 |
|
$ (0.92) |
Diluted (loss) earnings per share |
|
$ (0.21) |
|
$ (0.44) |
|
$ 0.20 |
|
$ (0.92) |
Weighted average number of shares (millions): |
|
|
|
|
|
|
|
|
Basic |
|
122.9 |
|
121.5 |
|
122.7 |
|
121.5 |
Diluted |
|
122.9 |
|
121.5 |
|
123.8 |
|
121.5 |
(i) |
Quarterly amounts for 2023 have been adjusted see Note 17 in the condensed consolidated interim financial statements. |
Consolidated Interim Statements of Other Comprehensive Income (Loss)
(In thousands of Canadian dollars) (Unaudited) |
Three months ended |
Six months ended |
||||||
|
2024 |
|
2023 |
|
2024 |
|
2023 |
|
|
|
|
|
|
|
|
|
|
(Loss) earnings |
|
$ (26,173) |
|
$ (53,678) |
|
$ 25,378 |
|
|
Other comprehensive income |
|
|
|
|
|
|
|
|
Actuarial gains (losses) that will not be reclassified to profit or loss (Net of tax of |
|
$ 65,346 |
|
$ 25,779 |
|
$ 71,951 |
|
$ 27,903 |
Change in revaluation surplus (2023: Net of tax of |
|
— |
|
— |
|
— |
|
6,993 |
Total items that will not be reclassified to profit or loss |
|
$ 65,346 |
|
$ 25,779 |
|
$ 71,951 |
|
$ 34,896 |
Items that are or may be reclassified subsequently to profit or loss: |
|
|
|
|
|
|
|
|
Change in accumulated foreign currency translation adjustment (Net of tax of |
|
3,401 |
|
(8,686) |
|
11,111 |
|
(9,119) |
Change in foreign exchange on long-term debt designated as a net investment hedge (Net of tax of |
|
(3,226) |
|
6,498 |
|
(9,838) |
|
6,618 |
Change in cash flow hedges (Net of tax of |
|
(1,258) |
|
(782) |
|
(4,880) |
|
(3,889) |
Total items that are or may be reclassified subsequently to profit or loss |
|
$ (1,083) |
|
$ (2,970) |
|
$ (3,607) |
|
$ (6,390) |
Total other comprehensive income |
|
$ 64,263 |
|
$ 22,809 |
|
$ 68,344 |
|
$ 28,506 |
Comprehensive income (loss) |
|
$ 38,090 |
|
$ (30,869) |
|
$ 93,722 |
|
|
Consolidated Interim Statements of Changes in Total Equity
|
|
|
|
Accumulated other comprehensive income (loss) |
|
|
|||
(In thousands of Canadian dollars) |
Share capital |
Retained earnings |
Contributed surplus |
Foreign currency translation adjustment(i) |
Unrealized gains and losses on cash flow hedges(i) |
Unrealized gains on fair value of investments(i) |
Revaluation surplus |
stock |
Total equity |
Balance at |
|
597,429 |
3,227 |
8,625 |
4,416 |
(2,559) |
37,347 |
(7,183) |
|
Earnings |
— |
25,378 |
— |
— |
— |
— |
— |
— |
25,378 |
Other comprehensive income (loss)(ii) |
— |
71,951 |
— |
1,273 |
(4,880) |
— |
— |
— |
68,344 |
Dividends declared ( |
10,901 |
(54,169) |
— |
— |
— |
— |
— |
— |
(43,268) |
Share-based compensation expense |
— |
— |
11,387 |
— |
— |
— |
— |
— |
11,387 |
Deferred taxes on share-based compensation |
— |
— |
(425) |
— |
— |
— |
— |
— |
(425) |
Exercise of stock options |
2,498 |
— |
— |
— |
— |
— |
— |
— |
2,498 |
Settlement of share-based compensation |
— |
— |
(7,416) |
— |
— |
— |
— |
3,752 |
(3,664) |
Balance at |
|
640,589 |
6,773 |
9,898 |
(464) |
(2,559) |
37,347 |
(3,431) |
|
|
|
|
|||||||
|
|
|
Accumulated other comprehensive income (loss) |
|
|
||||
(In thousands of Canadian dollars) |
Share capital |
Retained earnings |
Contributed surplus |
Foreign currency translation adjustment |
Unrealized gains and losses on cash flow hedges |
Unrealized gains on fair value of investments |
Revaluation surplus |
stock |
Total equity |
Balance at |
|
809,616 |
— |
10,972 |
12,885 |
2,945 |
2,745 |
(25,916) |
|
Loss |
— |
(111,382) |
— |
— |
— |
— |
— |
— |
(111,382) |
Other comprehensive income (loss)(ii) |
— |
27,903 |
— |
(2,501) |
(3,889) |
— |
6,993 |
— |
28,506 |
Dividends declared ( |
— |
(51,252) |
— |
— |
— |
— |
— |
— |
(51,252) |
Share-based compensation expense |
— |
— |
6,062 |
— |
— |
— |
— |
— |
6,062 |
Deferred taxes on share-based compensation |
— |
— |
1,100 |
— |
— |
— |
— |
— |
1,100 |
Exercise of stock options |
4,447 |
— |
(1,363) |
— |
— |
— |
— |
— |
3,084 |
Shares re-purchased |
(4,498) |
— |
(11,595) |
— |
— |
— |
— |
— |
(16,093) |
Shares sold by RSU trust |
— |
— |
— |
— |
— |
— |
— |
9,841 |
9,841 |
Settlement of share-based compensation |
— |
(3,015) |
(15,192) |
— |
— |
— |
— |
8,892 |
(9,315) |
Change in obligation for repurchase of shares |
9,011 |
— |
20,988 |
— |
— |
— |
— |
— |
29,999 |
Balance at |
|
671,870 |
— |
8,471 |
8,996 |
2,945 |
9,738 |
(7,183) |
|
|
|
(i) |
Items that are or may be subsequently reclassified to profit or loss. |
(ii) |
Included in other comprehensive income (loss) is the change in actuarial gains and losses that will not be reclassified to profit or loss and has been reclassified to retained earnings. |
Consolidated Interim Statements of Cash Flows
(In thousands of Canadian dollars) (Unaudited) |
Three months ended |
Six months ended |
||||||
2024 |
2023 |
2024 |
2023 |
|||||
CASH PROVIDED BY (USED IN): |
|
|
|
|
||||
Operating activities |
|
|
|
|
|
|
|
|
(Loss) earnings |
|
$ (26,173) |
|
$ (53,678) |
|
$ 25,378 |
|
$ (111,382) |
Add (deduct) items not affecting cash: |
|
|
|
|
|
|
|
|
Change in fair value of biological assets |
|
52,488 |
|
27,547 |
|
(16,655) |
|
28,674 |
Depreciation and amortization |
|
64,446 |
|
66,371 |
|
130,299 |
|
133,796 |
Share-based compensation |
|
6,089 |
|
4,050 |
|
11,387 |
|
6,062 |
Deferred income tax (recovery) expense |
|
(8,843) |
|
(5,144) |
|
11,093 |
|
(8,018) |
Current income tax (recovery) expense |
|
2,484 |
|
(4,926) |
|
4,789 |
|
(14,261) |
Interest expense and other financing costs |
|
43,637 |
|
37,554 |
|
85,720 |
|
69,157 |
(Gain) loss on sale of long-term assets |
|
(1,326) |
|
741 |
|
(1,637) |
|
975 |
Impairment of property and equipment and ROU assets |
|
118 |
|
6,530 |
|
118 |
|
6,530 |
Change in fair value of investment property |
|
(5,038) |
|
— |
|
(5,038) |
|
— |
Change in fair value of non-designated derivatives |
|
2,991 |
|
(8,635) |
|
(1,674) |
|
(5,526) |
Change in net pension obligation |
|
2,169 |
|
(136) |
|
3,236 |
|
331 |
Net income taxes refunded (paid) |
|
18,764 |
|
3,143 |
|
21,746 |
|
1,366 |
Interest paid, net of capitalized interest |
|
(32,459) |
|
(33,838) |
|
(72,936) |
|
(67,628) |
Change in provision for restructuring and other related costs |
|
3,087 |
|
(13,545) |
|
(173) |
|
(19,551) |
Change in derivatives margin |
|
(1,075) |
|
8,454 |
|
1,241 |
|
(5,286) |
Cash settlement of derivatives |
|
(728) |
|
(2,735) |
|
(2,878) |
|
8,274 |
Other |
|
2,231 |
|
(3,913) |
|
5,324 |
|
(3,696) |
Change in non-cash operating working capital |
|
(77,366) |
|
(84,844) |
|
(66,519) |
|
(41,107) |
Cash provided by (used in) operating activities |
|
$ 45,496 |
|
$ (57,004) |
|
$ 132,821 |
|
$ (21,290) |
Investing activities |
|
|
|
|
|
|
|
|
Additions to long-term assets |
|
$ (16,318) |
|
$ (55,869) |
|
$ (40,131) |
|
$ (105,121) |
Interest paid and capitalized |
|
(219) |
|
(757) |
|
(574) |
|
(1,238) |
Proceeds from sale of long-term assets |
|
2,631 |
|
206 |
|
3,496 |
|
270 |
Purchase of investments |
|
— |
|
(100) |
|
— |
|
(100) |
Cash used in investing activities |
|
$ (13,906) |
|
$ (56,520) |
|
$ (37,209) |
|
$ (106,189) |
Financing activities |
|
|
|
|
|
|
|
|
Dividends paid |
|
$ (21,607) |
|
$ (25,693) |
|
$ (43,268) |
|
$ (51,252) |
Net (decrease) increase in long-term debt |
|
(50,480) |
|
219,554 |
|
(81,365) |
|
268,354 |
Payment of lease obligation |
|
(7,891) |
|
(7,462) |
|
(16,337) |
|
(17,380) |
Exercise of stock options |
|
2,498 |
|
2,315 |
|
2,498 |
|
3,084 |
Repurchase of shares |
|
— |
|
(5,324) |
|
— |
|
(16,093) |
Sale (purchase) of treasury shares |
|
— |
|
9,841 |
|
— |
|
9,841 |
Payment of financing fees |
|
(2,122) |
|
(2,281) |
|
(2,122) |
|
(3,292) |
Cash (used in) provided by financing activities |
|
$ (79,602) |
|
$ 190,950 |
|
$ (140,594) |
|
$ 193,262 |
(Decrease) increase in cash and cash equivalents |
|
$ (48,012) |
|
$ 77,426 |
|
$ (44,982) |
|
$ 65,783 |
Cash and cash equivalents, beginning of period |
|
206,393 |
|
79,433 |
|
203,363 |
|
91,076 |
Cash and cash equivalents, end of period |
|
$ 158,381 |
|
$ 156,859 |
|
$ 158,381 |
|
$ 156,859 |
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