3rd Sep 2025 09:13
(Alliance News) - Hilton Food Group PLC on Wednesday said a shortage of white fish prompted "significant" raw material inflation and softer UK demand, contributing to a drop in half-year profitability.
In response, shares in the Huntingdon, England-based food packaging company plunged 18% to 670.00 pence in London on Wednesday morning.
Hilton Food reported pretax profit of GBP24.3 million for the 26 weeks that ended June 29, falling 4.7% from GBP25.5 million the year prior.
Adjusted operating profit edged down 0.4% to GBP46.6 million from GBP46.8 million, but rose 1.9% on a constant currency basis.
Revenue increased 7.6% to GBP2.09 billion from GBP1.94 billion, reflecting higher volumes and higher raw material prices, while administrative expenses rose 5.0% to GBP157.8 million from GBP150.3 million.
Retail meat and convenience delivered above-market volume growth of 3.1% with contributions from all regions, but seafood suffered softer results, with reduced availability of white fish leading to raw material inflation and therefore softer UK demand.
Weaker UK seafood demand has been driven by quota cuts leading to "significant" raw material inflation, the firm explained.
"We are responding with product reformulation and the introduction of alternative species alongside tactical inventory purchases to protect availability for the remainder of the year," Hilton Food said.
Reflecting the increased inventory, and higher capital spending in Canada, Hilton Foods incurred GBP30.8 million of adjusted free cash outflow in the half-year, compared to GBP30.0 million adjusted free cash inflow a year before.
Net debt increased to GBP202.4 million at June 30 from GBP131.4 million at the end of 2024.
In Europe, Hilton Food's Foppen smoked salmon business was hurt by regulatory restrictions on shipments to the US resulting in operational disruptions.
Despite the challenges of the high inflationary environment, Hilton Foods said it expects full-year adjusted pretax profit to land within the GBP76.8 million to GBP81.0 million consensus range. This would be up from GBP76.1 million in 2024 and GBP66.0 million in 2023.
"We expect our retail meat businesses to continue to perform well for the remainder of 2025 and we will continue to address the impact of inflationary trends in white fish and the operational disruption in Foppen," the company said.
Hilton Food declared an interim dividend of 10.1 pence, up 5.2% on-year from 9.6p.
By Jeremy Cutler, Alliance News reporter
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