Meat processor Hilton Food (HGF) achieved both volume and sales growth of about 5 per cent in 2012, despite a weak consumer environment and adverse exchange rates. What's more, the group managed to generate £20.5m of free cash flow and slash net debt by 72 per cent to £5.2m.
Helped by the completion of a robotic store picking facility for Coop in Denmark, sales in western Europe rose 5.3 per cent to £935.4m. Although, exchange rates and consumer down-trading to cheaper meat cuts, meant operating profit from the region rose just 2 per cent to £23.7m. In central Europe, meanwhile, turnover increased 3 per cent and volumes grew, too, but tough market conditions and exchange rates dented margins - so operating profit there fell 15 per cent to £2.3m.
But a significant catalyst for future growth came after the year-end when Hilton announced a joint venture with Woolworths - Australia's largest retailer - whereby it will operate a meat processing plant supplying 84 Woolworths stores. This is a major coup for Hilton and represents its first step beyond Europe - if successful, Hilton could expand further in Australia and possibly into Asia.
Broker Peel Hunt expects adjusted pre-tax profit of £26m for 2013, giving adjusted EPS of 25.9p (2012: 24.7p).
| HILTON FOOD GROUP (HFG) | ||||
|---|---|---|---|---|
| ORD PRICE: | 340p | MARKET VALUE: | £242m | |
| TOUCH: | 335-344p | 12-MONTH HIGH: | 345p | LOW: 235p |
| DIVIDEND YIELD: | 3.5% | PE RATIO: | 14 | |
| NET ASSET VALUE: | 52p | NET DEBT: | 13% | |
| Year to 30 Dec | Turnover (£bn) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2008 | 0.73 | 17.3 | 16.5 | 8.14 |
| 2009 | 0.83 | 20.1 | 20.1 | 9.36 |
| 2010 | 0.86 | 22.2 | 22.6 | 10.2 |
| 2011 | 0.98 | 24.5 | 24.7 | 11.1 |
| 2012 | 1.03 | 24.7 | 24.9 | 12.0 |
| % change | +5 | +1 | +1 | +8 |
Ex-div: 29 May Payment: 28 Jun | ||||
