Volume 47, Number 9
[dropcap size=small]T[/dropcap]he landlocked Canadian operation headquarters of High Liner Foods in Concord, Ont. don’t conjure up images of cresting waves, surging gales or groundswells. But, upon closer inspection, the porthole-inspired boardroom signs, brass accents, leather seating and rich wood tones fittingly pay homage to a sea-faring life.
The Lunenburg, N.S.-based company (with U.S. headquarters in Danvers, Mass.) was founded in 1899 as W.C. Smith & Company, a salt-fish operation in Lunenburg, N.S. And, for nearly a century, its crew boasted big quotas and big boats, selling everything that was caught. But, after a government-imposed moratorium shut down the cod fishery in July 1992, the company’s leaders had to rethink their modus operandi. “We went through a period where we [had] our back against the wall,” says Mario Marino, president and COO, Canadian Operations, who started with the company as a sales rep nearly 34 years ago. “We had close to 50 vessels and no fish to catch. So, as an organization, we had to [entirely change] our model and source fish around the world. Procurement was not even a word in our vocabulary.”
The cod fishery supported coastal communities for hundreds of years, but, when stocks dwindled to near extinction, it cast a beacon on the exploitation of ocean life and the need to safeguard natural resources. “The learning there was sustainable fisheries are so important,” Marino adds. “We had to [make] sure we were sustainable and the industry was sustainable around seafood, because if we don’t have sustainable fisheries we’re not going to have fish to catch, fish to process and fish to sell.”
So, in 2010, the company defined a goal to source all its seafood from certified sustainable or responsible fisheries by the end of 2013. This includes purchasing from suppliers who catch or farm seafood responsibly, protecting against over-fishing and limiting the impact of fishing and aquaculture — the cultivation of seafood in controlled saltwater or freshwater conditions — on the environment. In February, the company reported reaching 99 per cent of its sustainability goal. This achievement required collaboration from every aspect of the business, including procurement, sales, marketing and information systems. It also came at a time of rapid business growth — 2007 annual sales were US$275.3 million; today sales exceed US$1 billion — including three acquisitions that required large-scale integration with seamless customer service.
This past February, High Liner Foods was recognized for its achievements in sustainability when it was honoured with the McDonald’s Canada 2014 Sustainability Award at the restaurant company’s Supplier Summit in Toronto. “High Liner helped McDonald’s Canada navigate sustainable sourcing practices for fish and seafood as we completed MSC’s (Marine Stewardship Council) third-party chain-of-custody certification,” says Amy Hwang, manager, Supply Chain Management for McDonald’s Canada in Toronto. “Through our partnership, we’ve been able to leverage their expertise to achieve the certification milestone and take a further step forward in our sustainability journey.”
High Liner Foods’ sustainability efforts also include reducing the company’s overall carbon footprint. At some plants, used cooking oil is generating electricity; at manufacturing locations, all paper, plastic, metals and food waste is recycled; and retrofitted lights at the Lunenburg processing facility have reduced energy consumption by 200,000 kWh annually. The company is also working with Sedex (the Supplier Ethical Data Exchange), a London, U.K.-based
not-for-profit membership organization, which helps drive improvements in ethical and responsible practices throughout the supply chain.
On the heels of its award from McDonald’s, High Liner Foods was named SeaShare’s 2014 National Fisheries Institute’s Donor of the Year — among other 2014 accolades — for its contributions of seafood, processing and funds. The Bainbridge Island, Wash.-based non-profit has provided more than 180-million seafood meals throughout the American food-bank network. Meanwhile, High Liner Foods’ Canadian operations supported various charitable groups this year, including United Way, Habitat for Humanity, World Wildlife Fund Canada and Big Brothers Big Sisters of Canada, among others. “It’s sharing back what we have been so lucky to have as a company — to continue to grow even in tough times,” says Jerome Amlinger, VP, Sales and Marketing, Foodservice Division, who works out of the Concord office.
And, there could be more to share since this year’s second-quarter operating results show sales increased in the first half of 2014 by US$58.1 million, or 12.1 per cent, to US$538.2 million, compared to US$480.1 million during the same period last year. The increase is attributed partly to improved profitability in Canada and the U.S. but mainly to the acquisition of New Bedford, Mass.-based American Pride Seafoods in October 2013, which added US$73.5 million in sales in the first half of 2014. This is one in a string of acquisitions, which saw High Liner Foods gobble up Miami-based Atlantic Trading Company, LLC in October of this year; Newport News, Va.-based Icelandic U.S.A. in 2011; the American assets of Malden, Mass.-based Viking Seafoods in 2010; and St. John’s, N.L.-based FPI (Fishery Products International) in 2007, among others.
Consolidating the fragmented North American seafood industry is key to reaching the company’s Adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) target of US$150 million by 2016. “We are aggressively pursuing acquisitions,” Marino says. “You get cost effectiveness in buying raw materials, packaging and processing, so you can get your costs down just by scale. That helps us continue to be profitable, and it helps us continue to innovate and support the category in retail and foodservice.”
High Liner Foods’ product line now comprises 30 species and more than 400 SKUs in foodservice and has grown beyond fish sticks to include premium species such as squid, lobster, crab and mussels. In October, four new species of wild-caught fish were added to the Foodservice Signature product line, including Alaska sockeye salmon, Alaska halibut, Alaska black cod and Pacific cod. And, this past summer the company introduced a gluten-free line, which includes two items under the Sea Cuisine label: Wild Pacific Salmon Fillets in Creamy Dill Sauce and Mediterranean-Glazed Haddock Portions. The new offerings meet customer demands for gluten-free products and come certified with the Mississauga, Ont.-based Canadian Celiac Association’s stamp of approval. “People are looking for gluten-free options on menus,” Amlinger explains. “And they still want indulgence; they still want to try a battered or baked fish product with
a crispy coating on it, not just a plain piece of fish.”
Making it easy for foodservice operators to increase seafood consumption at their establishments drives the top brass at High Liner Foods. They ensure product offerings provide customers with consistency in quality and consistency in supply chain, ensure products can be presented in multiple ways without a lot of specialized equipment or highly skilled labour and provide four regional distribution centres for foodservice in Canada, allowing deliveries within 24 hours from coast to coast.
As one of the largest purchasers of fish in the Canadian foodservice industry, the buyers at McDonald’s Canada have built a long-standing, collaborative relationship with High Liner Foods. “Their level of expertise of the seafood industry, coupled with their leadership and commitment to sustainable sourcing, makes them a trusted partner,” says Hwang. “Their values are aligned with ours and, as such, we’re very proud to work with them.”