Vancouver, BC - Fletcher's Fine Foods Ltd. reported its fourth quarter earnings increased 308% as revenues grew 32% to a record $95.1 million. The increase in fourth quarter revenues was due to strong sales growth in both the Fresh Pork and Prepared Foods Divisions. Sales in the Prepared Foods Division increased $15.5 million, or 53%, while sales in the Fresh Pork Division increased $7.6 million, or 18%.
In the fourth quarter ended December 27, 1997, Fletcher's earned $1.8 million, or $.31 per share, on revenues of $95.1 million, compared to earnings of $0.4 million, or $.10 per share, on revenues of $71.9 million in the fourth quarter a year ago. Fletcher's gross margin increased to 12.3% from 7.7% in the fourth quarter a year ago.
Fletcher's sales in fiscal 1997 increased 30% to a record $391.1 million compared to $300.6 million in 1996. About half of the Company's growth in 1997 came from internal growth in both its Prepared Foods and Fresh Pork Divisions; the remainder of the increase resulted from the Grimm's acquisition in early 1997. Grimm's manufactures and supplies a full line of branded specialty meat and other deli products.
For the full year, Fletcher's earned $6.1 million, or $1.10 per share, compared to $0.6 million, or $.18 per share in 1996. The 1997 earnings reflect a $0.7 million one time charge for the re-configuration of the Tukwila, Washington and Portland, Oregon production lines, as well as a $3.5 million gain on the sale of 80% of Fletcher's interest in Britco Export Packers Ltd., a small-scale hog processor servicing niche markets in British Columbia's Greater Vancouver area.
"We are pleased with our overall progress in repositioning the Company for the future," said Fred Knoedler, Fletcher's President and CEO. "We are especially delighted with the performance of our Prepared Foods Division which increased its gross margin by 109% to $31.6 million."
"Our 1997 results were achieved in spite of difficult operating conditions for our Fresh Pork Division," said Don Loewen, Fletcher's Chairman. "This is proof that Fletcher's strategic focus on developing its branded consumer products business makes sense."
"Since our November 1996 IPO, we have completed six acquisitions -- all of which relate to our Prepared Foods Division and its various branded consumer products business segments," said George Paleologou, Fletcher's VP and CFO. "These acquisitions, combined with other recent capital allocation decisions such as our $28.5 million investment in the expansion of our Red Deer, Alberta hog processing facility, position us well for achieving our targeted return on capital in 1998 and subsequent years."
Fletcher's has been engaged in the food processing business since 1917 and has manufacturing facilities in Alberta, British Columbia, Oregon, Saskatchewan and Washington.
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