Australian volumes help drive Hilton Food profit

By Aidan Fortune

- Last updated on GMT

Hilton Food Group said volume sales more than doubled in Australia
Hilton Food Group said volume sales more than doubled in Australia

Related tags Europe Australia Beef Lamb

An increase in production capacity in Australia and favourable currency conditions have helped Hilton Food Group to revenue and profit growth in 2016.

In the 52 weeks to 1 January 2017, the group’s operating profit rose by 18.4%.

The business saw volume sales increase 7.4% in the year and 8.9% on a like-for-like 52-week basis. Its success stories were in the UK, Ireland, Holland and Australia. However, lower volume sales were reported in Denmark and Central Europe.

Volume sales in Australia grew by 134% in the year as the Melbourne facility increased production​, while start-up costs reduced. The group’s central costs were higher as it increased resources to manage growth.

New meat trading business

In its Western Europe division, volumes were 3.8% higher than last year, driven by good volume growth in the UK and “encouraging growth​” in its Irish business. The range of products supplied was extended during the year to include fresh pizzas and meal boxes from its Swedish facility.

Sales on a like-for-like 52-week constant currency basis in Western Europe grew by 7%, reflecting the higher volumes and boosted by the launch of Hilton Food Solutions, its new meat trading business.

Central Europe was less successful, with volume sales decreasing by 4.5% due to “competitive headwinds​”. However, value sales grew 8.8%, driven by increased raw material prices and a mix shift into beef. The region’s range was extended to include fresh pizzas​ and sous vide products.

‘Strong year’

The group also attributed growth over the year​ to “favourable currency movements​”.

Chief executive Robert Watson said: “2016 was a very strong year as Hilton continued to make good progress with volume and profit growth, range extension and the launch of a meat trading business, despite competitive market conditions. The conclusion of a joint venture in Portugal​ and the development of a further factory in Australia demonstrates our geographical and operational growth and we continue to explore further expansion opportunities.​”

Looking ahead, he said: “The medium-term outlook for Hilton is positive with the commencement of the Portugal joint venture company and the planning phase for the new Queensland factory in Australia under way. With these new projects and continued focus on product development and range extension, Hilton is confident of making further progress.​”

Watson added that an increasing reliance on centralised packing operations by grocery retail markets around the world will “give rise to a wide range of potential future geographical expansion opportunities for Hilton, but inevitably in a range of different timescales as markets develop and change over time​”.

Related topics Meat

Related news

Show more

Follow us


View more