Hillsdown sticks with diverse menu

Little more than a year into the job of chief executive of Hillsdown Holdings, the food and housebuilding conglomerate, and George Greener is already speaking glowingly about his new charge. His sentences are studded with management gobbledegook such as "economic value added", "mutuality of benefit" and the dreaded "core competencies".

But the City will forgive him much more than this if he can kick-start a company whose shares have underperformed the market by 34 per cent in the past three years. On yesterday's evidence, there is a way to go yet.

With his strategic review completed, it is clear there will be no radical shake-up of the Hillsdown portfolio, which still includes a diverse spread of businesses, including Typhoo tea, ready-made meals and Fairview Homes. There are no plans to sell the non-food businesses. Instead Hillsdown plans to withdraw from its red meat operations and sell a host of other businesses in packaging and leather with total assets of pounds 85m. Talks on deals are well advanced and the company is planning a pounds 30m write-down in the full-year figures.

But, looking at Hillsdown's half-year figures, it is clear that there are potential dangers ahead. Pre-tax profits for the six months to June rose from pounds 44m to pounds 57m. But at the operating level, profits at three of the four food businesses fell. The figures were rescued by a strong performance from the furniture and house-building businesses, which are clearly benefiting from the upswing in the economic cycle.

The worry is that when the economy comes off the boil, Hillsdown will hit the buffers unless its food businesses can start generating growth. At the moment they are very much a mixed bag. The chilled business is performing well, poultry was badly affected by a freak viral outbreak in the sector which cost pounds 2.5m, and the grocery businesses are struggling.

On forecasts of pounds 165m, the shares, up 6p to 169.5p yesterday, trade on a forward rating of just 10. This is a substantial discount to the sector, while a yield of more than 6 per cent provides support.

But the City will want to see more evidence of growth in food before the shares enjoy a re-rating. Potentially a good bet, but perhaps too early to chase just now.

Start your day with The Independent, sign up for daily news emails
News
ebookA unique anthology of reporting and analysis of a crucial period of history
News
peopleMathematician John Nash inspired the film Beautiful Mind
News
Richard Blair is concerned the trenches are falling into disrepair
newsGeorge Orwell's son wants to save war site that inspired book
Life and Style
Audrey Hepburn with Hubert De Givenchy, whose well-cut black tuxedo is a 'timeless look'
fashionIt may be a paradox, but the industry loves it
Arts and Entertainment
The pair in their heyday in 1967
music
Life and Style
fashionFrom bathing dresses in the twenties to modern bikinis
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Guru Careers: Software Developer / C# Developer

£40-50K: Guru Careers: We are seeking an experienced Software / C# Developer w...

Neil Pavier: Management Accountant

£45,000 - £55,000: Neil Pavier: Are you looking for your next opportunity for ...

Sheridan Maine: Commercial Accountant

£45,000 - £55,000: Sheridan Maine: Are you a newly qualified ACA/ACCA/ACMA qua...

Laura Norton: Project Accountant

£50,000 - £60,000: Laura Norton: Are you looking for an opportunity within a w...

Day In a Page

Abuse - and the hell that came afterwards

Abuse - and the hell that follows

James Rhodes on the extraordinary legal battle to publish his memoir
Why we need a 'tranquility map' of England, according to campaigners

It's oh so quiet!

The case for a 'tranquility map' of England
'Timeless fashion': It may be a paradox, but the industry loves it

'Timeless fashion'

It may be a paradox, but the industry loves it
If the West needs a bridge to the 'moderates' inside Isis, maybe we could have done with Osama bin Laden staying alive after all

Could have done with Osama bin Laden staying alive?

Robert Fisk on the Fountainheads of World Evil in 2011 - and 2015
New exhibition celebrates the evolution of swimwear

Evolution of swimwear

From bathing dresses in the twenties to modern bikinis
Sun, sex and an anthropological study: One British academic's summer of hell in Magaluf

Sun, sex and an anthropological study

One academic’s summer of hell in Magaluf
From Shakespeare to Rising Damp... to Vicious

Frances de la Tour's 50-year triumph

'Rising Damp' brought De la Tour such recognition that she could be forgiven if she'd never been able to move on. But at 70, she continues to flourish - and to beguile
'That Whitsun, I was late getting away...'

Ian McMillan on the Whitsun Weddings

This weekend is Whitsun, and while the festival may no longer resonate, Larkin's best-loved poem, lives on - along with the train journey at the heart of it
Kathryn Williams explores the works and influences of Sylvia Plath in a new light

Songs from the bell jar

Kathryn Williams explores the works and influences of Sylvia Plath
How one man's day in high heels showed him that Cannes must change its 'no flats' policy

One man's day in high heels

...showed him that Cannes must change its 'flats' policy
Is a quiet crusade to reform executive pay bearing fruit?

Is a quiet crusade to reform executive pay bearing fruit?

Dominic Rossi of Fidelity says his pressure on business to control rewards is working. But why aren’t other fund managers helping?
The King David Hotel gives precious work to Palestinians - unless peace talks are on

King David Hotel: Palestinians not included

The King David is special to Jerusalem. Nick Kochan checked in and discovered it has some special arrangements, too
More people moving from Australia to New Zealand than in the other direction for first time in 24 years

End of the Aussie brain drain

More people moving from Australia to New Zealand than in the other direction for first time in 24 years
Meditation is touted as a cure for mental instability but can it actually be bad for you?

Can meditation be bad for you?

Researching a mass murder, Dr Miguel Farias discovered that, far from bringing inner peace, meditation can leave devotees in pieces
Eurovision 2015: Australians will be cheering on their first-ever entrant this Saturday

Australia's first-ever Eurovision entrant

Australia, a nation of kitsch-worshippers, has always loved the Eurovision Song Contest. Maggie Alderson says it'll fit in fine