High Liner Foods (HLF) investor relations material

Executive summary

• Achieved strong sales and volume growth in Q1 2026, driven by earlier Lent, promotional activity, new business wins, contract manufacturing, and acquired brands.

• Profitability and margins declined due to inflation, higher raw material costs, supply constraints, and inability to fully pass on costs.

• Ongoing initiatives focus on pricing, promotions, supply chain, and plant efficiencies to restore margins and drive bottom-line growth.

• Maintained market leadership in North American branded and value-added frozen seafood, with strong retail and foodservice positions.

Financial highlights

• Q1 2026 sales increased 24.8% to $334.9 million; sales volume up 10.6% to 73 million lbs, driven by Lent timing, contract manufacturing, USDA contract, and acquired brands.

• Gross profit rose 4.9% to $66.6 million; gross margin declined to 19.9% from 23.7%.

• Adjusted EBITDA fell 8.7% to $29.3 million; margin dropped to 8.7% from 12%.

• Net income declined 47.7% to $8 million; adjusted net income down 31.3% to $11.4 million; diluted EPS dropped to $0.27 from $0.51; adjusted diluted EPS to $0.39 from $0.55.

• Net cash from operations improved by $35.6 million to $25 million inflow.

Outlook and guidance

• Expecting year-over-year adjusted EBITDA growth in 2026, with margin improvement anticipated in the back half of the year.

• Volume growth for the full year expected to be in the low single digits, with moderation as the USDA contract is lapped in Q4.

• Gross margin rate for the year likely to be slightly below 21%, but improving from Q1 levels.

• Guidance excludes potential tariff refunds or Section 301/IEEPA tariff impacts; any recovery would be incremental.

• Deleveraging remains a priority, with net debt to adjusted EBITDA expected to be just above 3x by year-end.