3rd Apr 2024 11:43
(Alliance News) - Hilton Food Group PLC's annual results provide growing confidence the firm is moving from rebuild into growth mode, Shore Capital said on Wednesday.
Shares in Hilton Food Group fell 2.5% to 833.00 pence on Wednesday morning, reversing early gains.
Hilton Food said an improved showing at its seafood business had underpinned a sharp increase in annual profit.
In 2023, the Huntingdon-headquartered food packaging company reported pretax profit rose 64% to GBP48.6 million from GBP29.6 million the year prior. Earnings per share more than doubled to 40.6 pence from 19.8p last year.
Revenue edged up 3.7% to GBP3.99 billion from GBP3.85 billion.
Hilton Food said the recovery in its seafood arm was delivered ahead of plan, returning to full year operating profit, supporting the uplift in group pretax profit.
The company said the core meat category continued to perform well with strong meat volume growth in Asia-Pacific plus a resilient out turn in Europe and UK, achieved against an inflationary backdrop.
While the Seafood business recovered strongly, market challenges in the vegetarian and vegan business remain, the firm commented.
"We have taken steps to consolidate this business into a single operating facility and we are confident in the opportunities that the category will present for Hilton Foods over the coming years," it said.
House broker Shore Capital said the figures showed an "especially pleasing profit rebuild," a little ahead of its expectations.
The broker said it looked forward to the current financial year with "greater confidence" and anticipates "record" profitability and growth beyond.
Shore Capital left profit forecasts for the next two financial years unchanged but lowered its debt predictions.
The broker pointed out Hilton Food trades on a 13.7 price to earnings ratio in 2024, falling to 12.8x in 2025.
"We see these.....multiples as especially attractive for a high-quality and advanced food manufacturer and end-to-end supply operator."
"Hilton Food Group once again offers a lot to like for equity investors," the broker concluded.
By Jeremy Cutler, Alliance News reporter
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