High Liner’s 1Q profit up, sales down

High Liner Foods on Tuesday released its first-quarter results, including an increase in net income to CAD 7.2 million (USD 7.1 million, EUR 5.6 million), compared to CAD 6.7 million in the same period last year.

The jump in net income came even though the Lunenburg, Nova Scotia-based seafood supplier recorded a decline in sales, to CAD 165.1 million (USD 162.5 million, EUR 128.2 million) in the first quarter of 2010 from CAD 183.3 million in 2009, as a stronger Canadian dollar reduced the value of its U.S. sales by approximately CAD 18.1 million. Sales volume for the first quarter of this year increased 3 percent to 51 million pounds.

Adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) amounted to CAD 14.1 million (USD 13.9 million, EUR 10.9 million) in the first quarter of 2010, compared to CAD 13.1 million in 2009.

“We are pleased with the improved profitability achieved for the quarter,” said High Liner President and CEO Henry Demone. “While our reported sales in Canadian dollars were down, primarily due to currency fluctuations, our sales volume was up 3.0 percent for the quarter.

Importantly, our U.S. foodservice business achieved a 7.1 percent increase in sales volume, representing the first quarter of growth since the recession began,” he added. “We are hopeful that the growth in this channel is signaling that the worst of the recession is behind us.”

Demone is optimistic about 2010: “We’re off to a good start in 2010 and our outlook for the rest of the year remains positive, despite the continued uncertainty in the economy. The lower raw material costs we have been experiencing benefit all our operations, and the stronger Canadian dollar benefits our Canadian business. Price decreases on commodity products along with greater promotional activity on value-added products should drive volume growth going forward. However, seafood costs in U.S. dollar terms have bottomed and we are beginning to see increases in isolated areas.”

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