Reuters — Packaged meat producer Maple Leaf Foods reported a lower-than-expected quarterly profit on Thursday, hit by higher costs as it invested more in new initiatives and capacity expansion.
The company has been keen on expanding in the U.S., seeing growth opportunities in humanely raised animal products and alternative protein sources.
In April, the company said along with its unit Greenleaf Foods it will build a $310 million plant-based protein facility at Shelbyville, Indiana, which is expected to double the company’s current production capacity and produce sausages and raw foods among other items.
The company has also secured a $2 billion funding arrangement with its existing lenders to fund its expansion plans further.
Net earnings rose to $50.1 million, or 41 cents per share, in the first quarter ended March 31, from $27.9 million, or 22 cents per share, a year earlier.
Net earnings also included unrealized gains on derivative contracts.
Excluding items, the company earned 20 cents per share, missing analysts’ average estimate of 31 cents, according to IBES data from Refinitiv.
Sales rose to $907.1 million from $817.5 million.
— Reporting for Reuters by Shradha Singh in Bangalore.