Hilton Food Group confident in strategy as profits fall

(Sharecast News) - Hilton Food Group said on Tuesday that its adjusted profit fell in 2025 as inflation and weaker performance in parts of its seafood and alternative protein businesses weighed on earnings, while the group outlined a strategy to refocus on its core meat operations and announced plans to appoint a new non-executive chair. The FTSE 250 food packing and distribution group reported adjusted profit before tax of £73.2m for the 52 weeks ended 28 December, down 3.8% from £76.1m a year earlier, while adjusted profit before tax from continuing operations slipped 2.1% to £69.0m.

Revenue from continuing operations rose 10.3% to £4.21 billion, driven by raw material inflation, with volumes broadly flat at 523,379 tonnes.

Adjusted operating profit from continuing operations declined 4.0% to £95.1m, while adjusted earnings per share fell 8.2% to 56.0p.

Statutory profit before tax from continuing operations edged down 2.3% to £56.1m.

Free cash flow decreased to £53.6m from £62.2m, while net bank debt improved slightly to £126.7m.

Executive chair Mark Allen said the group's core meat business continued to show resilience despite cost pressures.

"Our core retail meat offering is a resilient business.

"Despite continued raw material inflation, the strength of our customer relationships and consistent delivery has underpinned our performance.

"Inflation has more materially impacted demand and profitability in Seachill.

"We continue to address challenges in Foppen and Dalco.

"Overall, we remain confident in our outlook for 2026."

The company said performance was supported by its core retail meat and fresh prepared food operations, offset by weaker demand and profitability at its UK seafood business Seachill, as well as ongoing challenges in Foppen and Dalco.

Adjusting items included £27.6m of costs linked to regulatory restrictions affecting Foppen's Greek facility, while total operating profit also reflected a £66.5m gain on disposals.

Hilton Foods completed a strategic review during the period, concluding it would prioritise investment in its core meat operations while implementing improvement plans in Seachill, Foppen and Dalco to increase "strategic optionality".

The group set out three growth levers focused on maximising its core meat business, improving portfolio mix and expanding geographically, supported by disciplined capital allocation and a target of mid-single digit operating profit growth over the medium term.

Allen said the review had "outlined a clear plan to focus the business on its core capabilities and strengthens our confidence in delivering sustainable long-term growth," adding that "growth will be driven by our core meat and fresh prepared food businesses."

The company maintained its progressive dividend policy, proposing a full-year dividend of 35p per share, up from 34.5p, and said its balance sheet remained strong with net debt at 0.9 times adjusted EBITDA.

Looking ahead, Hilton Foods said trading in early 2026 was in line with expectations and reiterated guidance for adjusted profit before tax of £60m to £65m, reflecting continued challenges in Seachill and Foppen, while Dalco is expected to remain loss-making.

Capital expenditure was expected to rise to around £100m in 2026 as the group invested in facilities in Canada and Poland.

Separately, the company said it had started a search for a new non-executive chair, led by senior independent director Patricia Dimond.

Allen would remain executive chair until a successor was appointed, after which he would transition to the role of group chief executive officer.

At 0858 BST, shares in Hilton Food Group were up 4.17% at 512p.

Reporting by Josh White for Sharecast.com.

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