Dairy company Saputo Inc. – which operates a huge plant just off Lougheed Highway in North Burnaby – saw its profit tumble in the latest quarter as its results were stacked against the surge in retail sales recorded at the outset of the pandemic last year, the company said recently.
And yet, it’s still managing to buy other companies to expand its dairy footprint.
Saputo Inc. has signed a deal to buy British cheesemaker Wensleydale Dairy Products Ltd. for $39 million.
The creamery in northern England operates two facilities in North Yorkshire and employs about 210 people making a variety of specialty and regional cheeses.
Wensleydale sources its milk from 40 local farms and uses its own starter cultures to make cheeses that it exports around the world.
"Wensleydale Dairy Products is home to an immense amount of passion, care and tradition," Saputo chief executive and chairman Lino Saputo said in a statement Monday.
"Not only is it a well-established British business with high-quality products and award-winning cheeses, but our corporate cultures are well-aligned."
The deal is the latest in a string of strategic acquisitions by Montreal-based Saputo, one of the world's largest dairy processors with major operations in Canada, Australia, Argentina, the United States and the United Kingdom.
In May, Saputo said it had acquired Bute Island Foods, a Scottish manufacturer, marketer and distributor of vegan cheese. It also announced a deal to buy the Reedsburg, Wis., facility of Wisconsin Specialty Protein, which makes ingredients like goat whey, organic lactose and other dairy powders.
The two deals were part of a broader plan by the company to beef up its non-dairy cheese and value-added ingredients holdings.
The cheese and dairy maker said it also contended with lower international market prices for cheese and dairy products during its fourth quarter, and an ongoing slump in demand from restaurants, cafeterias and other foodservice customers.
"The effects of the pandemic, still present to date, lingered on during our fourth quarter with the ongoing shift in consumer demand continuing to impact all of our sectors to varying degrees," Lino Saputo Jr. told analysts during a conference call.
"Overall sales volumes were lower when compared to our fourth quarter last year, which at the time coincided with the onset of the pandemic and the related surge in retail demand," he said. "International market prices were also lower versus the prior year, putting downward pressure on results. Food service activities remained below pre-pandemic levels, with the U.S. sector mostly affected."
Saputo reported a profit of $103.1 million in the quarter, up from a profit of $88.7 million in the same quarter last year, as its revenue fell 7.5 per cent.
Revenue for what was the company's fourth quarter totalled $3.44 billion, down from $3.72 billion in the same quarter last year.
Back in April, the company saw its profits surge nearly 17%.
Saputo plans on pulling out of Burnaby after selling the property to a developer for more than $200 million. It plans on moving to Port Coquitlam.
Saputo, which ranks among the top three cheese producers, said market factors negatively impacted the company's earnings in the quarter ended March 31.
- With files from the Canadian Press
