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HIGH Liner Foods, the Canadian frozen seafood company hoping to buy a chunk of its rival, the Icelandic Group, has reported a drop in sales and profits for the fourth quarter of its trading year.
Based in Lunenburg, Nova Scotia, High Liner announced that overall group sales for the three months ended January 1st, dropped by five per cent to (Canadian) $147.7-million. But in Canada itself sales were down by seven per cent to £71.7 million. Net income ( Canadian term for profits) dropped from $3.8 million to $2 million.
Again the strong Canadian dollar, which has hit other seafood businesses in Canada recently , was blamed but the other worrying factor is low sales in the home market, probably due to the economic downturn.
However, president and chief executive Henry Demone was still upbeat, saying:"We benefited from the growth in sales volumes in the U.S. in both our food service and retail businesses, as well as from our cost-reduction initiatives to expand our margins. Moreover, we improved on our key performance measures while executing our strategic go."
High Liner is keen to expand its US base and in December it signed a deal to acquire Viking Seafoods Inc. for US$31.5 million as part of that strategy. Last month it made a surprise 340 million euro bid for the Icelandic group which has seafood operations in Europe, Britain and Asia as well as North America. But that offer was ignored in Iceland. However, it is widely expected to bid just for Icelandic USA, based in Newport News, Virginia, now that the Icelandic Group has stated it plans to sell that part of the business.
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