WH Group reports further growth in latest quarter

WH Group Limited, achieved higher turnover and operating profit in the last quarter compared with the same period in 2016.

photo by Kadmy | BigStockPhoto
photo by Kadmy | BigStockPhoto

The world’s largest pig meat producer, WH Group Limited, achieved higher turnover and operating profit in the last quarter compared with the same period in 2016.

For the three months ended March 31, 2017, the Hong Kong-based Group reports increases of 3.2 percent in turnover and 2.2 percent in operating profit compared with year-ago figures, to US$5.319 billion and US$418 million, respectively. For the firm’s owners, underlying profit is up more than 10 percent to US$248 million.

For the quarter, WH Group’s business divisions fared differently. While Hog Production and Fresh Pork improved turnover and operating profit, higher raw material costs for the company’s Packaged Meat segment – its core business - resulted in an almost 22 percent fall in operating profit on stable turnover of around 760,000 metric tons.

WH Group hog  and pork production

Volume of output from the Hog Production division was up by 9.2 percent. Changes in hog prices and the Group’s hedging results in the U.S. meant that the value of this output was 1.8 percent higher than the first quarter of 2016, and operating profit rose to US$89 million.

A 3.2 percent increase in pig processed by the firm’s Fresh Pork segment for the latest quarter is attributed mainly to the acquisition of Clougherty Packing, LLC from Hormel in a deal completed in January 2017. With 1.1 million metric tons in external sales of pork – up 9.6 percent from the first quarter of 2016 – and improved sales of imported pork in China, the division achieved an 8.8 percent rise in operating profit at US$123 million.

Smithfield Foods recent news

One month ago, Smithfield Foods, which is part of the WH Group and controls Animex Foods, announced an offer to acquire the meat processing facilities of Pini Group of Poland.

In the US, Smithfield Foods launched an antibiotic-free line of fresh pork products under its Pure Farms brand in February. The Pure Farms pork product line features minimal processing and no antibiotics, steroids, hormones or artificial ingredients. 

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