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Saputo Reports Financial Results for Fiscal 2019 Second Quarter

Saputo Reports Financial Results for Fiscal 2019 Second Quarter


MONTREAL, CANADA
Friday, November 2nd, 2018

Saputo Inc. CEO Lino Saputo Jr. weighed in on USMCA’s dairy provisions this week—expressing surprise about the extent to which U.S. companies will be able to access the Canadian dairy market and warning against the potentially disruptive effect of giving import quotas to “the wrong people.”

Lino Saputo, Jr., CEO, Saputo“What was a little bit of a surprise was the amount of access Canada granted to the U.S. into our market,” said Saputo, in the company’s Q2 earnings call. He added: “All collected, we’re looking at over 10 percent of our market was given to these trading partners.”

Saputo claimed that domestic cheeses could lose shelf space to cheaper items produced abroad and suggested Canada had “made a mistake” in granting similar concessions in previous trade agreements with the European Union, accord to a report from the Toronto Star.

Saputo expressed surprise about the extent to which U.S. companies will be able to access the Canadian dairy marketWhile Saputo lamented the potentially disruptive effect of greater access to the Canadian market for U.S. dairy producers and processors, critics in the U.S. have, conversely, noted that the trade agreement’s dairy provisions were trivial in scope and disappointing to the U.S. dairy industry—particularly to long-beleaguered U.S. dairy farmers suffering from chronic oversupply.

Saputo Inc. also reported the fiscal results of its second quarter 2019. The company noted the following highlights from the 12-week period ending September 30, 2018:

  • Revenues for the quarter amounted to $3.420 billion, an increase of approximately $536 million or 18.6%.
  • Earnings before interest, income taxes, depreciation, amortization, acquisition, and restructuring costs (adjusted EBITDA*) amounted to $318.5 million, a decrease of $11.3 million or 3.4%.
  • Net earnings totalled $163.1 million, a decrease of $22.1 million or 11.9%.
  • Adjusted net earnings* totalled $163.1 million, a decrease of $22.3 million or 12.0%.
  • Net earnings per share (basic and diluted) were $0.42 for the quarter, as compared to $0.48 and $0.47 for the corresponding quarter last fiscal year, a decrease of 12.5% and 10.6%, respectively.
  • Adjusted net earnings per share* (basic and diluted) were $0.42 for the quarter, as compared to $0.48 and $0.47 for the corresponding quarter last fiscal year, a decrease of 12.5% and 10.6%, respectively.

Despite significant growth in the way of revenue, Saputo missed the analyst’s expectation with its net earnings, according to a The Globe and Mail report. The company’s stock had plunged from $30.65 on November 1 to $28.26 as of noon, Friday, November 2.

Saputo


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