Hilton Food posts 9.1 per cent revenue rise

27th Mar 2014 08:55

- Full-year earnings rise- Upbeat about Tesco supply agreement, joint ventures- Making good progress on its growth strategyMeat packing firm Hilton Food Group reported a healthy increase in annual revenue, following good demand, higher meat prices and favourable currency movements and underlined its confidence in future trading with an increased dividend.The Cambridge-based group, which sells its products in 13 European countries and Australia, said profit for the year increased 2.4% to £19.4m for the 52 weeks ended December 29th. Revenue grew 9.1% to £1.12bn after increased demand in the UK, Denmark and Holland, the latter accelerated by new product launches. Revenue also benefited from the recovery of higher meat prices and favourable movements in exchange translation, the group said.Operating profit slipped 0.7% to £25.8m while basic earnings per share (EPS) rose 0.4% to 25.0p.Hilton said its joint venture with Woolworths in Australia, announced in January 2013, is performing well and in line with expectations. Woolworths is building a new dedicated retail packed meat facility, near Melbourne in Victoria, due to commence production in 2015. It will be operated by the joint venture.Otherwise Hilton's five-year supply agreement with Tesco, announced in December 2013, is expected to substantially increase Hilton's UK volumes. "During 2014 material capital expenditure will be incurred at the UK facilities in Huntingdon which will enable the planned UK volume increases for Tesco. This will include investment in a further production unit," the group explained.Chief Executive Robert Watson said the group was making good progress with its growth strategy, including the development of its Australian joint venture and the new UK contract with Tesco. "The group has maintained a high level of investment in its meat packing facilities across Europe whilst realising the available opportunities to progressively and profitably expand its business. The strategic progress made during 2013 illustrates well the continued relevance and international transferability of Hilton's business model."The group has recommended an increased dividend payment of 12.75p, up from 12.0p the year before.Shares of the group rose 0.70% or 3.50 503.50p at 09:30 in London.CJ