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April 28, 1999
CBCL today announced earnings for the first quarter of 1999.
TORONTO, ONTARIO--CBCL (TSE: CBY) today announced earnings for the first quarter of 1999.
Sales and earnings from operations in the first quarter, although increased over last year, do not reflect the results of new management and initiatives that were started in January. As noted in the prior quarter's release, it will take some time for the effect of these actions to be fully realized in the financial results, but we do anticipate some near term improvements in the latter half of the year.
Sales of $138.9 million in the quarter reflected an increase from $118.9 million last year, primarily due to initial sales from the new A&P contract and increased frozen product sales in Canada and the US. Earnings from operations of $3.3 million compared to $3.2 million before unusual items last year.
Net earnings for the quarter of $1.8 million ($0.09 per share) compared to net earnings before unusual items last year of $2.5 million ($0.12 per share). The decrease is due to lower earnings from the Company's equity investment in Multi-Marques, and higher interest expense. The Company declared a dividend of $0.06 per share payable on July 2, 1999 to shareholders of record on June 14, 1999.
At the shareholders' meeting today, Mr. Dickhout provided details of the six near term priorities that the new management team is focused on to restore the health of the fresh bread business: creating greater leadership capacity within the management ranks, focusing on winning in the core pan bread and rolls category, driving results through greater teamwork and accountability, getting core business processes to perform more efficiently, developing more effective strategies to win in the marketplace, and achieving a better balance of product demand and supply.
Late in the quarter, the Company successfully completed the integration of the A&P bread business, and its Hamilton Bakery acquisition. These actions will result in immediate improvements in productivity and market share in the Ontario operations.
While management is currently focused on the turnaround in the Company's short term financial performance, we remain convinced that the longer term potential of the Company is strong.
Canada Bread Company, Limited, which is 68 percent owned by Maple Leaf Foods Inc., is Canada's leading manufacturer and distributor of bakery products, sold both under the Company's own brands and private label brands to the retail and food service industries.
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