TORONTO, March 23, 2021 /CNW/ - George Weston Limited
("George Weston", "GWL", or the "Company") (TSX: WN) today
announced its intention to focus on its Retail and Real Estate
businesses as it launches a process to sell Weston Foods. This
announcement follows a strategic review by the Board of Directors
that determined these two pillars will remain the Company's most
significant drivers of long-term value creation. Despite its
position as a leading North American bakery, Weston Foods remains a
small part of GWL's overall value. In the absence of attractive
opportunities to increase its relative scale within the Company,
the Board believes that a sale represents the best opportunity to
unlock its growth potential.
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"Weston Foods has been at the core of our company for 139 years.
It has a strong foundation, attractive and growing margins, a
robust list of customers, strong brands, and a first-rate
management team," said Galen G.
Weston, Chairman and Chief Executive Officer. "As
George Weston focuses its attention
on Loblaw and Choice Properties, we are confident this is the right
time to unlock the strategic growth potential that exists within
Weston Foods through its sale."
Weston Foods, a leading North American manufacturer, serves
retail and foodservice customers with packaged fresh bread and
rolls as well as frozen and artisan bread and rolls, cakes, donuts,
pies, cookies, crackers, wafers and alternatives throughout
Canada and the U.S. The company
produces private label products and many well-known brands
including Wonder®, ACE Bakery®, Country Harvest®, D'Italiano®, Casa
Mendosa™, Dave's Killer Bread* and Gadoua®.
The Company intends to commence an orderly sale process shortly,
ensuring that a smooth transition plan is in place as Weston Foods
continues to support its customers and workforce. In the meantime,
the business will continue its focus on growing sales while
improving margins. The Company's Retail and Real Estate
businesses have solid balance sheets and generate strong cash
flows. As a result, the proceeds from the sale of Weston
Foods are likely to be returned to shareholders through share
repurchases over time.
Houlihan Lokey and CIBC Capital
Markets have been retained by the Company to advise on the sale
process and the Company will update the market on progress as
appropriate.
Weston Foods had sales of $2.1
billion and Adjusted EBITDA1 of $200 million in 2020.
Related to this announcement, a separate, joint press release
with Loblaw Companies Limited is being released today.
The Company will host an investor call and audio webcast on
Tuesday, March 23, 2021 at
8:30 a.m. (ET) to discuss today's
announcement. To access the conference call, please dial (647)
427-7450 or 1-888-231-8191, Access Code: 1627089. The playback will
be made available approximately two hours after the event at (416)
849-0833 or 1-855-859-2056, Access Code: 1627089. To access via
audio webcast, please visit the Investor Centre section of
www.weston.ca. Pre-registration will be available.
About George Weston Limited
George Weston Limited is a Canadian public company founded in
1882. The Company operates through its three reportable operating
segments, Loblaw Companies Limited, Choice Properties Real Estate
Investment Trust and Weston Foods. Loblaw provides Canadians with
grocery, pharmacy, health and beauty, apparel, general merchandise,
financial services and wireless mobile products and services.
Choice Properties owns, manages and develops a high-quality
portfolio of commercial retail, industrial, office and residential
properties across Canada. The
Weston Foods operating segment includes a leading North American
bakery that offers packaged bread and rolls in Canada as well as frozen and artisan bread and
rolls, cakes, donuts, pies, biscuits and alternatives throughout
Canada and the U.S.
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1 See Section 14,
"Non-GAAP Financial Measures", of the Company's 2020 Management's
Discussion and Analysis.
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* TM of Flowers
Bakeries Brands, LLC. Used under license.
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Forward Looking Statements
This press release may contain forward-looking information
within the meaning of applicable securities legislation, including
with respect to the announced corporate actions, which reflects the
Company's current expectations regarding future events. There can
be no assurance regarding (a) the ability of the Company to
successfully conclude a sale of the Weston Foods business, (b) the
net proceeds to be derived from a sale, (c) the timing of such a
sale, (d) the impact of this announcement or the Company's ability
to meet its stated 2021 financial outlook, or (e) other risks
inherent to the Company or its operating segments' businesses
and/or factors beyond its control which could have a material
adverse effect on the Company.
Forward-looking information is based on a number of assumptions
and is subject to a number of risks and uncertainties, many of
which are beyond the Company's control that could cause actual
results and events to differ materially from those that are
disclosed in or implied by such forward-looking information. Such
risks and uncertainties include, but are not limited to, the
factors discussed in the Company's current Annual MD&A and
Annual Information Form and uncertainty related to the ongoing
COVID-19 pandemic. The Company does not undertake any obligation to
update such forward-looking information, whether as a result of new
information, future events or otherwise, except as expressly
required by applicable law. All forward-looking statements
contained in this press release are made as of the date hereof and
are qualified by these cautionary statements.
SOURCE George Weston Limited