Shares in Hilton Food Group have slumped today following another profits warning at the multi-protein food packer, as it struggled to pass on soaring costs in the UK seafood business to supermarkets.
In an autumn trading update this morning, the group said it continued to work closely with retail partners in the UK and had made “good progress” in either mitigating or passing through unprecedented inflationary costs.
However, Hilton warned this was happening at a slower pace than anticipated and the process was not yet fully complete, and would continue for the rest of the year and into early 2023.
“Given the challenges in the UK seafood business alongside the wider macro-economic environment, the board anticipates that operating profit will now be below its expectations for the full year,” the statement said.
“Despite this the board remains confident that the business is well placed for 2023, with the group’s financial position continuing to be strong, with leverage remaining at comfortable levels.”
Shares in Hilton had slumped more than 14% by lunchtime to 544.6p – with the stock’s value now halved in 2022 so far.
It is the second warning on profits by the firm in recent months, after it pushed down expectations in September as volumes came under pressure amid cut backs from cost-conscious consumers.
Broker Peel Hunt said Hilton’s troubles reflected the challenging environment in the UK and a focus from retailers to restrain price increases.
“As this process is ongoing, we are expecting some knock-on effect on next year’s numbers,” the firm said in a note.
Overall, Hilton said in its trading statement that group volumes and revenues had been in line with expectations.
Trading in the Asia-Pacific region was in line with expectations and revenues at the single-customer facilities in Europe were ahead of a year ago.
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