By Kevin Bell
Aug. 9 (Bloomberg) -- Menu Foods Income Fund, the Canadian owner of a company that recalled more than 60 million cans of pet food, reported a second-quarter net loss as sales plunged 44 percent after customers canceled orders.
The net loss was C$3.6 million ($3.4 million), or 19 cents a unit, compared with profit of C$1.97 million, or 11 cents, a year earlier, the company said today in a statement. Sales fell to C$47.2 million. Since the March 16 recall, customers accounting for at least 16 percent of revenue stopped using Menu Foods Ltd.
The company, North America's biggest maker of store-brand pet food, recalled the products after some cats and dogs that ate them became sick with kidney failure and later died. Most of the C$45 million in recall costs have been included in the last two quarterly results, Menu Foods said.
Menu Foods stock, known as units, dropped 17 cents, or 5.2 percent, to C$3.10 by 4 p.m. in trading on the Toronto Stock Exchange. They have plunged 58 percent since March 15, the day before the recall was announced. Income trusts avoid most corporate taxes because they pay the bulk of their cash flow.
Menu Foods, based in Streetsville, Ontario, also said it agreed to sell a production facility in South Dakota to Mars Inc. for $26.3 million. The proceeds will go to pay down debt, the company said.
To contact the reporter on this story: Kevin Bell in Toronto at kbell2@bloomberg.net
source: http://www.bloomberg.com/apps/news?pid=20601082&sid=a3NJam.x08Ck&refer=canada