Hilton Food Group PLC (LSE:HFG) shares fell almost 11% to 10-year lows below 454p after the meat and fish packer flagged a tougher year ahead despite meeting expectations for 2025.
The self-described protein supplier said adjusted profit before tax for 2025 would come in between the £72 million to £75 million guidance range previously indicated at its profit warning in November, when it flagged ongoing operational issues and subdued demand. Profits were £76.1 million the year before.
Christmas trading was said to be "good", especially in red meat and salmon, and the group renewed key retail contracts in the Netherlands and Denmark.
However, there was a cut to 2026 guidance, with the group now expecting adjusted profit before tax of between £60 million and £65 million, around 15% below 2025 levels.
Hilton blamed continued export restrictions from its Greek smoked salmon facility, which have disrupted supply to the US, as well as ongoing inflation in beef and white fish.
US stock write-offs from its Foppen smoked salmon subsidiary would be “significantly higher” than expected, although these will be treated as non-underlying costs.
Hilton said its strategic review is nearing completion and will prioritise core meat capabilities while exploring value-maximising options for other areas of the business.
Analysts at Panmure Liberum said the "guidance gut" for 2026 was "disappointing but not completely unexpected given the persistent inflation and change in management, but it does likely mean an end to downgrades given the extent of the cut".
On the strategic update review, they said the strategic options for non-core areas are likely to be the UK Seafood businesses and Dalco vegetarian protein business.
"In the short-term, shares are likely to remain weak but we see significant value in the core red meat business where the focus should return to post the strategic review," they added, with the shares currently trading at 9.6x earnings and 5.8x on an EV/EBITDA basis.