Research, Charts & Company Announcements
Research Tree provides access to ongoing research coverage, media content and regulatory news on HILTON FOOD GROUP PLC. We currently have 26 research reports from 1 professional analysts.
|23Feb17 13:01||RNS||Holding(s) in Company|
|01Feb17 12:52||RNS||Total Voting Rights|
|17Jan17 17:48||RNS||Block listing Interim Review|
|13Jan17 16:36||RNS||Holding(s) in Company|
|13Jan17 11:54||RNS||Director/PDMR Shareholding|
|12Jan17 07:00||RNS||Trading Statement|
|04Jan17 07:00||RNS||Joint Venture|
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Research reports on
HILTON FOOD GROUP PLC
HILTON FOOD GROUP PLC
FY16 pre-close +ve surprise: Raising FY16, 17, 18 PBT c.1%, 4% and 6%
12 Jan 17
Today’s slightly better-than-expected FY16 pre-close trading statement prompts us to raise our FY16 PBT estimate by c.1%, reflecting the combination of (1) growth in several of HFG’s key markets, (2) strong overall operating performance, and (3) favourable fx translational benefits (recalling that 62% of FY15 sales were ex-UK). To reflect the positive profit contribution impact of the Portuguese j/v agreement signed on January 4th, the j/v income line is boosted by €1.5m (c.£1.3m) and €2.5m (c.£2.2m) in FY17 and FY18 respectively, representing upgrades of c.4% and c.6%. Once operating at full capacity utilisation, the j/v could well add €3m (c.£2.6m) in FY19. To reflect (1) our increased FY16-FY18 forecasts, (2) current peer EV/EBITDA valuation multiples, and (3) our view that HFG now deserves to trade at a premium to the peer group in view of its impressively strong financial track record (i.e. FY06-FY16 since IPO) for organic and investment-led profitable growth, combined with an array of emerging, highly promising initiatives (see our note “Start of a new chapter of growth” published on October 4th) to expand the scale and scope of HFG’s core business, we raise our TP to 805p (previously 755p). Maintain BUY.
Significant j/v confirmed with Sonae, Portugal; HFG’s 15th country
04 Jan 17
Consistent with a highly-successful, critical strand of HFG’s stated growth strategy (i.e. entering new territories with new customers), HFG has signed a 50/50 j/v with Sonae, Portugal’s leading food retailer, to redevelop and operate Sonae’s existing sourcing/packing facilities to supply c.750 Sonae group stores with a range of packaged meats. We view today’s development, following an initial c.6 month co-operation period, as significant and encouraging on multiple levels; (1) the Portuguese facility is similar in size to HFG’s current third largest plant near Melbourne, Australia in terms of annual tonnage of c.50,000; (2) management states that it expects the redeveloped facility, post an initial €22m investment by the j/v, to be earnings enhancing in FY17 [we estimate that HFG’s share of profits could be as much as €3m in FY19 i.e. c.8% of our forecasted FY16 PBT]; (3) the Portuguese j/v is similar in structure to that of the proven j/v operational arrangement that HFG has had in Australia since 2013, thereby giving us comfort that HFG can capture its fair share of the financial rewards in a risk-managed fashion; and (4) today’s move to a formal j/v has come well within the 6-9 month period guided to when the co-operation agreement was first announced in July 2016, suggesting to us that HFG’s working relationship with Sonae has been highly successful so far. In short, we think the stockmarket will welcome HFG allocating its surplus cash to develop its core business with such a leading retail client, following on so soon from December’s announcement that HFG will invest A$115m to expand its packing capability in Australia. We maintain BUY.
New packing facility; Highly significant for underpinning future growth
06 Dec 16
HFG has announced plans to expand its packing capability in Australia, by constructing (at an expected investment cost of A$115m financed through bank facilities) a new meat processing facility in Queensland, in order to supply Woolworths, the leading grocery retailer in Australia. This is a highly significant development as the new Queensland plant, alongside HFG’s two existing dedicated retail packed meat facilities in Melbourne and Bunbury (both operated as a joint venture with Woolworths) should mean that HFG supplies the bulk of Woolworth’s c.1,000 stores with their red meat needs over time. In short, this development should underpin growth at HFG for many years to come from 2020 onwards, which, in turn, should result in a higher and more stable earnings stream over time, supporting a continued rerating of HFG’s valuation multiple, in our view. We reiterate our BUY.
Panmure Morning Note 03-11-2016
03 Nov 16
Today’s trading update (18th July 2016 to date) will reassure the stock market, likely further comforted by HFG’s frequent financial calendar trading updates given the current backdrop of quite heightened economic and political uncertainty. Management comments that HFG “continues to trade in line with the Board’s expectations”. This, in turn, reflects a continuation of the established overall positive trading patterns seen in the H1FY16 (January 4th to July 17th) results published on September 13th. We reiterate our BUY.
Panmure Morning Note 04-10-2016
04 Oct 16
We think, over the medium-term, investors will look back at FY2016 as the start of a new distinctive chapter of growth for HFG, predicated on the refinement of the already potent HFG investment thesis. We use the recent strong H1FY16 results as a good opportunity to reflect on the long-term implications of a number of initiatives and developments, over and beyond the well-understood and wellexecuted focus on progressively and profitably expanding the scale and scope of HFG’s core business. Our positive thesis on the stock is predicated mainly on the company’s under-appreciated long-term, value-added growth strategy, which will result in a higher and more stable earnings stream over time, supporting a continued rerating of HFG such that it should sit at the top end of the peer range, in our view. Having reflected further on H1FY16 results, and updated our relative valuation exercise, we increase our TP to 755p (715p), giving 22% upside
Panmure Morning Note 13-09-2016
13 Sep 16
H1FY16’s PBT of £16.7m (+26.7% y/y) is ahead of our and consensus expectations of £16m. Our FY16 forecasts are unchanged for now whilst we note the pleasing 12.2% interim dividend increase to 4.6p. These interims impress on three key levels; (1) HFG’s underlying trading performance remains strong despite the context of a dynamic and challenging grocery retailing backdrop, combined with macro uncertainty and attendant currency volatility; (2) the first real evidence of the important financial benefit of HFG’s significant capacity investment in the UK and expansion in Australia; and (3) the strong momentum running throughout the business. We reiterate our BUY.
13 Feb 17
Middlesbrough-based pawnbroker Ramsdens Holdings is set to join AIM on 15 February. Its growth is not coming from its core business but from providing foreign currency, pre-paid travel cards and international payments. The strategy is to increase the group’s online activities and grow the number of branches. In the year to March 2016, group revenues improved from £29.2m to £30m. The accounts of the main subsidiary show that foreign-currency margin rose from £5.36m to £7.59m. This contributes 35% of group gross profit. By contrast, the core business of pawnbroking, precious metal purchases and retail sales fell from £21.3m to £19.8m. Revenues from other financial services were flat at £2.6m. Ramsdens has 127 sites and last year it made an operating profit of £3.19m. In the six months to September 2016, revenues increased from £16.2m to £18.4m and operating profit improved from £2.81m to £3.48m. The placing will raise £15.6m at 86p a share, valuing the company at £26.5m. NorthEdge Capital, which backed a buyout in September 2014, will receive just over £10m from share sales. The NorthEdge stake will fall from 75.6% to 30.7%. The other £5m will go to the company and be used to repay the remaining loan notes and the costs of the flotation. By the end of March 2016, there were still £4m of loan notes outstanding to NorthEdge, with £4.86m paid off during the previous year.
25 Nov 16
Sound Energy (SOU): Completion of fundraise (BUY)| Ithaca Energy (IAE): Inspection delay (BUY) | Zambeef* (ZAM): Good performance in a challenging year (CORP) | Gresham House Strategic* (GHS): Attractively priced (CORP) |Joy of Techs: Analyst interview | Support Group: Analyst interview
10 for 17
09 Jan 17
As always at the start of a year, there are significant uncertainties about the year ahead but I think in 2017, the level of uncertainly has decisively moved up a gear. In fact, a leading economist at the LSE, Ethan Ilzetzki, was recently quoted as saying “I view the current global economic environment as the most uncertain in modern history”. Wow.
Driving distribution – price target raised
26 Jan 17
Fever Tree’s (FEVR LN, HOLD, T/P 1250p) strong second half trading statement and clear ability to drive distribution forward this calendar year prompts us to upgrade both our full year 2016 and 2017 forecasts as well as raise our price target from 1080p to 1250p, which implies a full valuation for now.
Breakfast in America
24 Feb 17
Peacock Foods should ensure Greencore enjoys organic, profitable convenience food expansion in both the UK and US. The acquisition transforms America, in our view. Moreover, while long term mature market growth remains the salient investment case driver, Peacock’s benefits currently appear unrecognised in Greencore’s share price. BUY.
04 Nov 16
Looking at the top 50 non-listed casual dining and bar operators, it appears that the £80bn market for eating and drinking out in the UK is alive and well. The AlixPartners Growth Company Index (October 2016) shows that 2-year profit CAGR has improved over the last few years, and recent surveys from Greene King, Coffer Peach and Deloitte highlight elevated spend on out-of-home occasions. We attribute this to 1) a shift amongst consumers from an ownership to experience-led mentality which has driven habitual spend on leisure 2) an increasing focus on food from historically wet-led operators as they diversify their revenue streams to mitigate competition from the off-trade and match consumer gravitation towards eating out and convenience; 3) increasing regional penetration resulting from oversupply and high rental costs in London and 4) strong sector support from Private Equity investors, attracted to the Leisure sector's cash flow profile which can be leveraged against. Nevertheless, we may look back on 2016 as the peak for casual dining and bar operator profitability, particularly for London-weighted operators who face unfavourable rent and rate costs as well as potential loss of cheap migrant/seasonal labour. Past performance is certainly not a guide to future performance.