Canada Bread earnings climb 27% in third quarter

by Eric Schroeder
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TORONTO — Net earnings at Canada Bread Co., Ltd. in the third quarter ended Sept. 30 were C$25,050,000 ($23,339,000), equal to C$0.99 per share on the common stock, up 27% from C$19,727,000, or C$0.77 per share, in the same period a year ago.

Earnings from operations before restructuring and other related costs were C$36,915,000 ($34,410,000), up from C$31,859,000.

"Our organization has achieved steady earnings growth despite challenging global economic conditions," said Richard Lan, president and chief executive officer. "We are steadfastly focused on growing sales through deepening our relationships with customers, delivering more product innovation to appeal to consumers, and developing lots of excitement and momentum internally around our market wins and opportunities ahead."

Sales for the third quarter fell 4% to C$424,555,000 ($396,188,000) from C$443,086,000 for the prior-year period.

Earnings from operations within the Fresh Bakery segment rose 28% to C$33,260,000 ($31,026,000) despite a 1% decline in sales to C$287,285,000 ($267,871,000).

"Fresh Bakery launched several exciting new innovative products in the quarter aimed at supporting margin and category expansion," Canada Bread said. "Dempster’s OvenFresh is a line of fresh, long life white and multigrain baguettes and dinner rolls that finish baking at home in minutes. Under a licensing agreement, the company has also launched Cadbury Snack Cakes in Eastern Canada, an exciting new addition to its sweet goods offerings in the region."

Earnings from operations with the Frozen Bakery segment fell 38% to C$3,655,000 ($3,408,000) from C$5,874,000. Sales in the division eased 11% to C$137,270,000 ($127,924,000) from C$152,890,000. The company said earnings in the division were adversely affected by the continued effects of the recession on sales of premium specialty bakery products in the United Kingdom.

For the nine months ended Sept. 30, Canada Bread posted net earnings of C$62,469,000 ($58,214,000), or C$2.46 per share, up from C$38,476,000, or C$1.51 per share, in the same period a year ago. Net sales were C$1,273,598,000 ($1,187,240,000), up narrowly from C$1,263,373,000 in the same period a year ago.

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