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Michael McCain steps down as Maple Leaf Foods CEO

Current president and chief operating officer Curtis Frank steps into the top role

The head of Maple Leaf Foods Inc. said he's confident in the future of the companyas he hands the reins of the protein producer to current president and chief operating officer Curtis Frank.

CEO Michael McCain will stay on as executive chair of the board of directors for the Mississauga-based firm, and said his family would remain as the company's largest shareholder through McCain Capital.

"When I started at Maple Leaf almost three decades ago, the world was a very different place and the challenges, while many, were perhaps not as profound as they are today,'' said McCain on a call with analysts Thursday. The company announced a year ago that McCain would be stepping down after taking the top job in 1998.

"Our vision to be the most sustainable protein company on Earth is inspiring and enduring. I could not be more thankful or prouder of the team that we have the resilience that they've shown over decades," he said.

The remarks came as Maple Leaf reported a loss in its first quarter compared with a profit a year ago as it faced a difficult pork market, cost inflation and higher startup expenses. McCain said on the call that some of the post-pandemic difficulties the industry has faced are starting to abate.

The company said Thursday it lost $57.7 million or 48 cents per share for the quarter ended March 31 compared with a profit of $13.7 million or 11 cents per share in the same quarter last year.

Sales in the quarter totalled $1.17 billion, up from $1.13 billion in the first three months of 2022.

The company said the increased revenue came as sales in its meat protein group rose to $1.14 billion compared with $1.09 billion in the same quarter last year. Plant protein sales fell to $37.4 million compared with $44.9 million a year earlier.

McCain said in a news release that the company's supply chain has made "exceptional progress back to full normalization," and the company had been raising prices to mitigate inflation.

Maple Leaf is also taking advantage of renewed access to Chinese markets, he said.

McCain also said the company hoped to achieve neutral adjusted earnings before interest, taxes, depreciation and amortization on its plant-protein business this year.

"Our objective is for the plant-protein business to be highly profitable,'' he said on the call with analysts.

McCain said the company had seen demand in China for pork products go up, as European supply contracts.

On an adjusted basis, Maple Leaf said it lost 12 cents per share compared with an adjusted profit of three cents per share in its first quarter last year.

Analysts on average had expected an adjusted loss of 10 cents per share and $1.16 billion in revenue, according to estimates compiled by financial markets data firm Refinitiv.

Analyst Irene Nattel at RBC Capital Markets said in a note that Maple Leaf's meat and plant protein businesses delivered marginally better results than forecast.

Shares in the company were up almost 10 per cent Thursday at $27.43.

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