Australia growth underpins solid year for Hilton Food Group

Hilton Food Group said turnover had improved 50% in its preliminary results on Wednesday, to £2.77bn at constant currency, thanks to strong growth in Australia.

The FTSE 250 food packaging company put that down to the end of a transition period for its joint venture with purchase of the venture’s assets, and a full year at its “state-of-the-art” facility in Brisbane.

It said its adjusted operating profit was 22.5% firmer for the 53 weeks ended 3 January, at £67m, while adjusted basic earnings per share were 20.4% higher at 55.4p.

Cash flows from operating activities improved 30.5% year-on-year, to £91.7m.

The company’s board proposed a 21.5% hike in the total dividend for the year, to 26p.

On the operational front, the company said it had opened its new facility in Belgium for the Ahold Delhaize supermarket group, with a volume ramp-up underway, while its New Zealand facility was scheduled to open in the third quarter of the year.

Volume growth for the year was 23.8%, within which Australia grew 107.9% and Europe grew 8.5%.

“[Our] response [to Covid-19] underpinned a strong performance with both volume and profit growth and we concluded our joint venture transition period in Australia and purchase of the related joint venture assets while marking our one year anniversary of the opening of our Queensland facility,” said chairman Robert Watson.

“In Europe we set up a new facility in Belgium during the year to supply Delhaize and continued to further diversify our product offering in the plant-based, seafood and convenience categories.

“As with all businesses there remain some uncertainties concerning the full impact of Covid-19, including potential recessionary risks, but our robust and sustainable business model and wide geographical spread make us believe we are well placed to meet any future challenges.”

At 0913 BST, shares in Hilton Food Group were up 3.76% at 1,160p.