Canada’s Premium Brands Holdings cuts earnings outlook as beef costs rise
CANADA – Premium Brands Holdings has lowered its 2025 earnings forecast, citing higher beef prices that have pressured profit margins despite stronger sales.
The Canadian processed meat and deli-foods group said on November 10 that it now expects its adjusted earnings before interest, tax, depreciation, and amortization (EBITDA) to reach between US$478.1 million and US$485.2 million, down from its earlier projection of US$485.2 million to US$499.4 million.
In 2024, the company’s adjusted EBITDA stood at US$416.1 million.
While trimming its earnings outlook, Premium Brands raised its annual revenue forecast to between US$5.28 billion and US$5.36 billion from the previous range of US$5.14 billion to US$5.28 billion.
The company reported record third-quarter revenue and adjusted EBITDA for the 13 weeks ending September 27, with sales reaching US$1.42 billion, up 19.1% from the same period in 2024.
Adjusted EBITDA climbed 12.4% year-on-year to US$127.7 million, driven by a 10.3% increase in organic sales volumes.
President and CEO George Paleologou said margins fell short of expectations due to double-digit inflation in beef raw material costs.
He added that the company views the price spike as temporary and is implementing pricing adjustments and new procurement measures to recover margins in affected product lines.
According to Paleologou, these steps aim to return the company to its medium-term goal of achieving a 10% annual adjusted EBITDA margin.
Acquisition plans remain on track
Despite the cost challenges, Premium Brands said its merger and acquisition pipeline is strong, with several potential deals under review.
Paleologou noted that the company expects to finalize some of these transactions within the next two quarters but emphasized that any acquisitions will align with ongoing efforts to reduce debt levels through 2025 and 2026.
Earlier this year, Premium Brands acquired Arizona-based Denmark Sausage for about US$21 million, expanding its presence in the U.S. premium sausage market.
The company also announced three acquisitions in December 2024, including NSP Quality Meats and Casa Di Bertacchi in the U.S. and Italia Salami in Canada.
Profit decline despite revenue growth
For the third quarter, Premium Brands reported a net loss of US$1.2 million, compared with a profit of US$17.8 million a year earlier.
Nine-month net earnings totaled US$20.2 million, down from US$59.1 million in the same period last year, while revenue for the first nine months of 2025 rose to US$3.98 billion from US$3.45 billion.
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