Hilton reported higher UK turnover, driven predominantly by red meat and fish volumes. The meat processor attributed its continued success to more consumers eating in due to the restrictions in place as a result of the coronavirus pandemic.
The business also reported similar growth across Central Europe, with volumes in Sweden and Denmark picking up thanks to new chicken packing operations in the area.
The trading update added: “During the period, the group’s performance has been in line with the Board’s expectations. We continued to grow the business through additional volumes reflecting both the ongoing shift to home consumption as well as close cooperation with our retail partners.
Strong financial positon
“The Group’s financial position remains strong and we continue to explore opportunities to invest in and to grow the business in both domestic and overseas markets.”
However, Shore Capital research analysts Darren Shirley and Clive Black said Hilton’s latest update was still marred by the unpredictable nature of the ongoing pandemic, which was reflected in their forecast for the company.
Shore’s current pre-tax profit forecast for the meat processor remained unchanged – £54m, slightly below the £54.4m consensus. However, Shirley said these expectations were slightly cautious, reflecting the increasingly fluid COVID-19 conditions.
“These premium ratings, in our view, are fully merited for a business that has leading facilities, processes and outstanding customer relationships that underpin growth ambitions across multiple geographies, proteins (meat, fish and meat-free) and categories,” said Shirley.
Shore anticipated “further new business wins and/or partnerships to be confirmed over the medium term,” said Shirley.
Matthew Webb, analyst at Panmure Gordon, had a more positive outlook for Hilton’s full-year results: “HFG continues to perform strongly, in line with the board’s expectations. Demand remains elevated due to the impact of COVID on the appetite for HFG’s range of staple food products.
“The group continues to meet this growing demand. We make no changes to our forecasts at this point but – with two months to go – HFG looks well-placed at least to meet market expectations for FY20 [the 2020 financial year].”