Hilton Food Group announces new boss as it declares slump in annual profits
Hilton Food Group unveils new boss as Tesco supplier profits slip after ‘unprecedented’ inflation offset sales increase
- Former Co-Op boss Steve Murrells will become CEO of Hilton starting early July
- Hilton Food Group reported that total sales grew by about a sixth to £3.85 billion
- Much of the company’s revenue growth has been driven by recent acquisitions such as Foppen
Hilton Food Group has announced its new CEO after profits fell due to major challenges in the food packaging company’s UK seafood business.
The Huntingdon-based company said former Co-Operative Group boss Steve Murrells would become CEO in early July, replacing Philip Heffer, who has been with Hilton for nearly three decades.
Murrells, 57, was recently in charge of Co-Op between 2017 and 2022, after stints leading the mutual retailer’s food division and three years as head of pork producer Tulip, later renamed Pilgrim’s.
Cost: Against a more volatile macroeconomic backdrop, Hilton Food Group said it was impacted by ‘unprecedented’ inflationary pressures in its UK seafood division
Heffer said Murrells’ relationship with Hilton dates back to the early 1990s, when the Essex-born businessman was the meat category director at Tesco, which sources much of its meat from the FTSE 250 company.
His appointment comes as Hilton revealed that pre-tax revenue fell 37.5 per cent to £29.6m for the year ending January 2023, as cost-of-living issues saw consumers cut spending.
Against a more volatile macroeconomic backdrop, the group said it was impacted by “unprecedented” inflationary pressures in its domestic seafood division and automation spending.
Additional costs were incurred for insurance and legal costs related to a fire at the site in Belgium in June 2021, higher interest rates and restructuring measures leading to staff redundancies.
Nevertheless, Hilton reported that total revenue rose by about a sixth to £3.85 billion on rising raw material prices and volumes, with the latter growing for a 15th consecutive year.
In January, the company said holiday sales in the UK and Ireland had been very strong.
Much of the sales growth was driven by the recently acquired smoked salmon producer Foppen, plant-based food producer Dalco and meat supplier Fairfax Meadow.
The acquisition of Foppen, financed primarily by a £75 million equity offering, helped Hilton gain a foothold in the US market, where the Dutch group sells seafood to retail giant Costco.
In addition, Hilton in Singapore has partnered with Country Foods as part of its efforts to grow in Southeast Asia.
The company said all these investments would help improve its “short and medium term growth prospects”, as did the recent recovery in its UK fishing business.
Heffer said: ‘Following the challenges we faced in our seafood business last year, we have taken a series of steps to restore profitability and we are now well positioned for the year ahead.’
The outgoing CEO plans to step down on July 3, but will remain with the company as an advisor to the Hilton Foods Board.
“After the work we’ve done over the past five years growing Hilton Foods and expanding our commercial model, now is a good time to step away from running the business,” he said.
Founded in 1994, Hilton supplies food to retailers in 19 countries, including fish to Waitrose and beef and lamb to supermarket chain Tesco. Another prominent customer is Woolworths, Australia’s largest supermarket chain.
Hilton Food Group shares were down 2.45 percent on Wednesday morning at 678 pence, meaning their value is down more than 44 percent over the past 12 months.