Hilton Food reports first-half profit growth, statutory revenue slides

4th Sep 2024 07:23

(Sharecast News) - Hilton Food Group reported strong first-half profit growth and increased volumes on Wednesday, although revenue slid more than 8% on a statutory basis.

The FTSE 250 company saw a 3.2% rise in volumes and a 1% increase in revenue on a like-for-like basis, despite challenges from raw material price deflation in the Asia-Pacific region.

On a statutory basis, revenue decreased 8.4% to £1.94bn, which the board put down to a shortened reporting period compared to the prior year.

Adjusted operating profit saw significant growth, increasing by 23.2% on a like-for-like basis and 12.2% on a reported basis, totaling £46.9m.

Free cash flow more than doubled to £34.7m.

Hilton Foods also noted continued expansion in core meat categories across all regions and growth in its seafood business, particularly in the UK and Ireland.

Developments include a new global contract for Foods Connected with McDonald's, progress in plant-based operations, and a commitment to sustainability, particularly in packaging.

Looking ahead , the company said it was optimistic about continued growth and strategic investments, while maintaining strong customer relationships and exploring geographic expansion.

"These results represent another step forward as Hilton Foods further improves business performance and profitability," said chief executive officer Steve Murrells.

"Our core meat category performed particularly well, driving volume growth, while the continued positive momentum in our seafood business has helped to underpin profit performance.

"Our core product ranges remain highly attractive to both our customers and their consumers, while the breadth of our offering make us well placed to win across every meal, in both retail and food service."

Murrells said that looking ahead, Hilton Foods had "all the right attributes" in place.

"Our strong financial platform, unique multi-category offer, and market-leading technology adds to my confidence in the group's ability to achieve further international growth."

In a separate announcement, Hilton Foods confirmed the appointment of Mark Allen OBE as non-executive director and chair designate, effective 1 October.

Allen, currently chair of AG Barr and former CEO of Dairy Crest Group, would take over as chair of Hilton Foods from January.

He would succeed Robert Watson, who had been with the company for over 20 years, including as chief executive and executive chairman, before transitioning to a non-executive role in 2021.

Watson would remain a significant investor in the company.

The board said Allen would bring substantial experience in the food and consumer goods industries, including leadership roles at Warburtons and Halo Foods.

At 0823 BST, shares in Hilton Food Group were down 2.43% at 949.37p.

Reporting by Josh White for Sharecast.com.