Hf Foods Group (NASDAQ:HFFG) Posts Earnings Results, Beats Expectations By $0.02 EPS

Key Points

• HF Foods reported quarterly EPS of $0.04, beating analysts’ $0.02 estimate, while revenue of $319.6 million slightly exceeded expectations and rose 4.1% year over year.
• Despite revenue and gross-margin growth, profitability weakened: adjusted EBITDA declined 6.3% to $11 million, and the company recorded a $4.2 million net loss. Management cited higher fuel costs and one-time transaction and refinancing expenses.
• Newly acquired Searay generated $4.2 million in revenue and $0.6 million in adjusted EBITDA in its first month; HF Foods expects its next quarter to include Searay’s first full quarter of results.

Hf Foods Group (NASDAQ:HFFG - Get Free Report) announced its quarterly earnings results on Monday. The company reported $0.04 EPS for the quarter, beating analysts' consensus estimates of $0.02 by $0.02, FiscalAI reports. The firm had revenue of $319.57 million for the quarter, compared to analyst estimates of $318.26 million. Hf Foods Group had a positive return on equity of 7.24% and a negative net margin of 2.77%.

Here are the key takeaways from Hf Foods Group's conference call:

• Revenue rose 4.1% to $319.6 million, marking the seventh consecutive quarter of year-over-year growth, while gross profit increased 5.9% and gross margin expanded to 16.7%. Seafood volume growth and improved pricing were key drivers.
• Profitability weakened: adjusted EBITDA fell 6.3% to $11 million, and HF Foods reported a $4.2 million net loss versus a $1.1 million loss a year ago. Management cited higher fuel costs and one-time transaction and refinancing expenses; fuel headwinds were about $1.4 million for the quarter.
• Searay contributed $4.2 million in revenue and $0.6 million in adjusted EBITDA during its first month under HF Foods, with a mid-teens adjusted EBITDA margin. The company expects the fourth quarter to be its first full quarter of Searay results, though integration and synergy work remain in early stages.
• Cash provided by operating activities reached $23.6 million in the first nine months, up from $4.5 million a year earlier, mainly reflecting a smaller inventory build and working-capital timing. After the Searay acquisition, HF Foods reported $16.4 million in cash and access to about $49.1 million in additional credit, subject to borrowing-base limits.
• Management described cross-selling as a significant opportunity but said it will unfold over a three-to-five-year period, with Searay integration taking priority in the near term. The company said it will continue evaluating acquisitions, while emphasizing disciplined pricing and integration capacity.

Hf Foods Group Trading Up 1.4%

NASDAQ:HFFG traded up $0.02 during trading hours on Monday, hitting $1.49. 37,567 shares of the company were exchanged, compared to its average volume of 185,252. The stock has a market capitalization of $80.31 million, a price-to-earnings ratio of -2.29, a price-to-earnings-growth ratio of 0.42 and a beta of 0.58. Hf Foods Group has a one year low of $1.38 and a one year high of $2.79. The company has a fifty day simple moving average of $1.58 and a 200 day simple moving average of $1.77. The company has a current ratio of 1.11, a quick ratio of 0.49 and a debt-to-equity ratio of 0.57.

Wall Street Analyst Weigh In

A number of research analysts recently issued reports on the stock. Alliance Global Partners reiterated a "buy" rating on shares of Hf Foods Group in a report on Thursday, July 23rd. Weiss Ratings raised shares of Hf Foods Group from a "sell (e+)" rating to a "sell (d-)" rating in a report on Tuesday, October 27th. Two investment analysts have rated the stock with a Buy rating and one has issued a Sell rating to the stock. According to data from MarketBeat.com, the stock currently has an average rating of "Hold" and a consensus price target of $5.50.

About Hf Foods Group

HF Foods Group Inc is a foodservice distributor that supplies restaurants and other foodservice businesses in the United States. The company primarily serves Asian restaurants, with a focus on Chinese restaurants, and provides products and distribution services designed to meet the specialized needs of these operators.

Its product portfolio generally includes fresh produce, meats, seafood, frozen and dry goods, beverages, condiments, paper products, and other restaurant supplies. HF Foods Group also provides logistics, warehousing, delivery, sourcing, and related supply-chain services, helping customers obtain a broad range of ingredients and operational supplies from a single distributor.

Founded in 1997 and headquartered in Raleigh, North Carolina, HF Foods Group has expanded through a network of distribution facilities serving restaurant customers across multiple regions of the United States.

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