TORONTO—Maple Leaf Foods is cutting 1,550 jobs, closing plants in four provinces and streamlining distribution in a frenzied efficiency drive.
The Toronto-based maker of processed meats and other foods said the changes are part of a three-year $560-million restructuring plan expected to boost competitiveness and profitability.
Maple Leaf will close processing plants in Kitchener, Hamilton and Toronto in Ontario; in North Battleford, Sask.; Moncton and a small plant in Winnipeg by the end of 2014.
The company said the plan will create 1,150 new jobs but the associated plant closures will more than offset that, resulting in a net loss of 1,550 positions from among its 21,000 employees.
Maple Leaf said it will build a new prepared meats plant in Hamilton, Ont., and will also invest in plants in Winnipeg, Saskatoon and Brampton, Ont.
The company will also close four of its distribution centres—in Moncton, N.B., Burlington, Ont., Kitchener, Ont., and Coquitlam, B.C.—consolidating distribution for Eastern Canada in a new facility in Ontario and using an existing facility in Saskatoon as its Western Canadian hub.
Maple Leaf has been streamlining for much of the past two years in a bid to improve its profitability and become more efficient. Wednesday’s announcement is the biggest move so far by the maker of Maple Leaf and Burns and Schneiders meats and seller of Tenderflake lard and Dempster’s and other breads.
The company was focused three years ago on a Lysteria-tainted meat scandal that led to a massive recall of cured meats manufactured at a contaminated Toronto plant. Later, Maple Leaf was under pressure from shareholders to improve its finances and restructure.
“The final phase of this plan will establish Maple Leaf Foods as a more streamlined and profitable company, well positioned to deliver significant and sustainable value to its shareholders,” said Michael McCain, president and CEO of Maple Leaf.
“We are creating, through one of the largest single investments in the Canadian food industry, a highly efficient, world-class prepared meats production and distribution network that will markedly increase our competitiveness and close the cost gap with our U.S. peers.”