Hilton Food shares soar as FTSE 250 company strikes supply deal with Walmart
- Hilton revealed it would build a new manufacturing plant in eastern Canada
- Walmart is one of Canada’s largest employers, serving 1.5 million people per day.
Hilton Food Group shares soared on Thursday after the FTSE 250 group signed a deal with Walmart to supply the retail giant’s Canadian hypermarkets.
The food packaging company revealed it would build a new manufacturing facility in eastern Canada that will deliver various meat products, starting with beef, lamb, pork and seafood, to Walmart ‘supercenters.’
A newly created subsidiary of Hilton will finance construction of the packaging facility, and debt will be used to finance investments in plant and equipment.
Deal: Hilton Food Group has signed an agreement to supply meat products, such as beef, lamb, pork and seafood to Walmart’s Canadian hypermarkets.
It hopes to begin production in 2026, with its first factory in North America offering robotic order picking at Walmart distribution points.
The Huntingdon-based firm believes the alliance “represents an important step forward” for both groups in meeting the growing demand in Canada for “high-quality, good value and increasingly sustainable protein products.”
Walmart is one of Canada’s largest employers, serving 1.5 million customers per day at more than 400 retail locations.
After the commercial update, Hilton Food Group Stock jumped 8 per cent to £7.84 at lunchtime on Thursday, making them the second best performer on the FTSE 250 index behind Trainline.
Steve Murrells, chief executive of Hilton, said the deal was “another sign of the strength of our offering to customers, as well as growing consumer demand for affordable, high-quality protein products, which we can offer through our scale, international experience and supply chain expertise.”
He added: “Hilton Foods and Walmart share the same high standards of sustainability and we look forward to offering Walmart the service and range of quality products that Hilton Foods is known for.”
Murrells, the former head of Co-Operative Group, took over at Hilton in July following the departure of Philip Heffer, who had been in charge for five years and with the company for nearly three decades.
The company’s new supply deal comes a week after it published half-year results showing sales rose 5.2 per cent to £2.1bn for the 28 weeks ending July 16.
The revenue growth reflected rising raw material volumes and prices and a full marketing period for Foppen, a smoked salmon producer purchased by Hilton in March 2022.
The trade was further boosted by continued strong performance of its core meat category and a rebound in demand for seafood.
However, adjusted pre-tax profits fell 22.8 per cent to £26.8 million due to higher interest payments and cost inflation, particularly affecting Dalco, a maker of vegan and vegetarian foods in the Netherlands.
Founded in 1994, Hilton supplies food to retailers in 19 countries, including supermarket chains Tesco, Morrisons and Waitrose, as well as pub chain Mitchells & Butlers and cruise company Carnival.