- Frozen sea-food supplier High Liner Foods (TSX:HLF) has reported a sales drop in its first quarterly report for 2020, due to the impact of the COVID-19 pandemic
- Sales volumes in the quarter dipped 1.5 per cent to 77.3 million pounds, when compared to 2019’s corresponding period
- Despite higher retail sales, the company’s food services business has been hit by widespread quarantine measures in North America
- Consequently, High Liner expects the pandemic to hinder its ability to deliver year-over-year EBITDA growth
- High Liner Foods (HLF) is up 7.69 per cent, with shares trading for C$7.00 and a market cap of $233.26 million
High Liner Foods (TSX:HLF) has reported a sales drop in its first quarterly report for 2020, due to the impact of COVID-19.
Sales volumes in the quarter dipped 1.5 per cent to 77.3 million pounds, when compared to 2019’s corresponding period.
Sales were trending up early in the quarter, but the company noted a drop-off in mid-March, following the onset of the virus.
While retail sales of the company’s seafood surged during the early weeks of the pandemic, High Liner saw a steep decline in its food service business, which accounts for 65 per cent of its operations.
Closures throughout the hospitality industry in North America, caused by the COVID-19 pandemic, resulted in the steep decline in food service business.
However, the company’s food service clients in hospitals and other essential industries currently remain open.
Rod Hepponstall, President and CEO of High Liner Foods, remains confident about the company’s performance, despite the recent challenges.
“Our improving financial performance in Q1 reflects significant progress and momentum in our business.
“Our work to drive continuous improvement across our business has significantly enhanced our ability to respond to the extraordinary challenges posed by COVID-19. We enter this period as strong as we have ever been,” he said.
Rod went on to say that the company is well positioned to navigate the recent economic uncertainty, with an approximate C$210.58 million in credit and around $40.57 million cash on hand.
Looking forward, the company is awaiting the end of the government’s imposed social distancing measures to calculate the extent of the damage to its business.
That said, High Liner expects the pandemic to hinder its ability to deliver year-over-year EBITDA growth.
High Liner Foods (HLF) is up 7.69 per cent, with shares trading for $7.00 at 1:31pm EDT.