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Weston to sell Heritage Salmon
George Weston Limited announced today its intention to sell its Heritage Salmon business.
Heritage Salmon President Fraser Walsh said, "We will be working closely with Weston to make the transition to new ownership as smooth as possible for everyone involved - including our employees, our customers and our suppliers.
In the meantime, it is business as usual."
Heritage Salmon is a fully integrated salmon aquaculture business operating in New Brunswick, Maine and British Columbia. George Weston Limited ("Weston"), a Canadian public company founded in 1882, is one of North America's largest food processing and distribution companies.
Canada News Wire
Weston has 4th-Qtr loss on writedown of fish unit
George Weston Ltd., the food company controlled by Toronto billionaire Galen Weston, said it had a fourth-quarter net loss on writedowns of a U.S. bakery unit and a salmon business.
The net loss of C$1 million ($812,000), or 6 cents a share, compared with a profit of C$252 million, or C$1.86 a share, in the year-earlier period, the Toronto-based company said. Sales fell 2.3 percent to C$7.1 billion.
George Weston plans to sell its Heritage Salmon fish-farming unit as prices declined on slumping demand. Weston also reduced the value of its Entenmann's bakery division, which makes sweet goods in the U.S., as consumers on low-carbohydrate diets cut purchases of cookies and pastries.
The company said one-time costs reduced profit by C$1.86 a share, including the writedown of its salmon business and Entenmann's. George Weston also had costs equal to 42 cents a share to revalue a 2001 forward sale agreement of 9.6 million shares of Loblaw Cos., the company's grocery store unit.
Shares of George Weston fell C$3.19, or 2.8 percent, to C$111.70 in 10:06 a.m. trading on the Toronto Stock Exchange, the biggest decline in five weeks. Weston was expected to earn C$1.79 a share, the median estimate of four analysts surveyed by Thomson Financial.
George Weston spokesman Geoff Wilson wasn't immediately available to comment.
Fish Farms
Weston said the fish unit was hurt by “negative publicity'' aimed at the farmed salmon industry last year, which led to lower prices. Weston took a C$9 million loss selling its Chilean salmon business last year. Heritage Salmon has fish farms in Maine, New Brunswick and British Columbia.
Weston's earnings were reduced in the fourth quarter a year ago, which had an extra week, after the company had C$63 million of pretax costs from closing two bakeries in Canada and severance costs at Loblaw. Operating income in the fourth quarter fell 3.5 percent to C$524 million.
About 86 percent of Weston's sales come from Loblaw, Canada's biggest supermarket chain. Weston owns 62 percent of Loblaw.
Loblaw said last week that fourth-quarter earnings rose 15 percent to C$337 million, or C$1.22 a share, from C$294 million, or C$1.06, a year ago.
(The company has scheduled a conference call for 11 a.m. Toronto time. It can be heard by dialing (1)(416) 640-4127. A replay can be hear by dialing (1)(416) 640-1917, passcode 21108960.)
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