Food companies with products that cause outbreaks usually end up falling into one of two groups. Either they are quickly gone forever, like Topps or Peanut Corporation of America, or they take responsibility and ask the public to give them another chance.
Canada’s Maple Leaf Foods clearly has joined the second camp, making a comeback after ready-to-eat meats from its Toronto processing plant spread Listeria across the country and killed 22 mostly elderly Canadians.
After announcing its return to profitability last week, Maple Leaf Foods watched its stock price rise to $11.45 per share, almost 79 percent of the price it fetched going into 2008 before meat cutting machines at the Toronto plant began contaminating cold cuts with listeria.
And the tragic outbreak could not have come at a worse time as Maple Leaf saw its stock price tank at the same time world markets were reeling from the worst economic crisis since the Great Depression.
Maple Leaf earned a $22.5 (Canadian) profit during the third quarter of 2009, up from a loss of $12.9 for the same period of 2008 when it was dealing with recall, litigation and investigative costs. It’s stock hit a low of $7.30 last year.
Market analysts read the third quarter financials as evidence that Maple Leaf has put the Listeria crisis behind it and the company is now able to focus on future earnings.
Maple Leaf has taken numerous steps to regain its place with consumers. Among these are opening ThinkFOOD Centre, a 25,000 square foot state-of-the-art culinary innovation facility for customer involvement in product development on the campus of it corporate offices in Mississauga, Ontario and being aggressive about recalls.
Last August, Maple Leaf recalled nine wiener products made by its plant in Hamilton, Ontario after its new testing procedures found low levels of Listeria. Dr. Randall Huffman, Maple Leaf’s Chief Food Safety Officer, they’d do recalls even if the food safety risk is remote.
Maple Leaf’s Food Safety Action Plan is now easily found on the company’s consumer education website. It says: “In August 2008, a number of Maple Leaf deli meats were found to be contaminated with Listeria which led to the deaths of 22 people and made many others ill.
“This was by far the most awful event in the 100-plus year history of the company. In the wake of this tragedy, Maple Leaf Foods made an unwavering commitment to be an industry leader in food safety and to help spread the word to educate consumers, peers and the industry on Listeria and other foodborne illnesses.”
With each step, Maple Leaf is winning the public back. It still has a ways to go, both to regain its stock price and sales for the third quarter were still down four percent at $1.29 billion.