WH Group (288) H2 2024 earnings summary

Executive summary

• Revenue for 2024 was US$25.941 billion, down 1.1% year-over-year, with packaged meat and pork sales volumes declining by 3% and 4.9%, respectively.

• EBITDA rose 56.1% to US$3.078 billion, operating profit increased 63.4% to US$2.404 billion, and net profit attributable to owners surged 142.7% to US$1.471 billion; basic EPS was 11.47 US cents.

• Record profits were achieved in 2024, driven by efficiency improvements, cost control, and business structure optimization across all major regions.

• Final dividend per share set at HKD 0.4, with a total annual payout of HKD 0.5 per share, plus a special dividend of HKD 0.18 and a Smithfield share distribution declared for 2025.

• Smithfield (North America) completed a partial IPO on Nasdaq, raising US$534 million and triggering special dividends.

Financial highlights

• Operating cash flow reached US$2.519 billion, up 55.8% year-over-year; cash and bank balances at year-end were US$2.055 billion.

• Capital expenditure was US$707 million, down 12.9% from the previous year, focused on plant upgrades and expansion.

• EBITDA margin improved to 11.9% from 7.5%; operating profit margin rose to 9.3% from 5.6%.

• Net profit margin increased to 6.6% from 3.2%; return on equity reached 15.7% (2023: 6.5%).

• Leverage ratio remained low at 0.29 by year-end 2024; debt to equity ratio improved to 29.1%.

Outlook and guidance

• Eight strategic measures are being implemented to drive packaged meat volume growth in 2025, including sales force specialization, network expansion, and increased marketing investment.

• Management expects continued improvement in pork operations, expansion of meat sales, and stable growth in packaged meats, while monitoring geopolitical and macroeconomic risks.

• Packaged meat profit per ton in 2025 is expected to be lower than 2024 but remain historically high.

• U.S. pork market outlook is bullish for 2025, with pork positioned favorably against other proteins.

• First quarter 2025 performance expected to be stable with potential growth; fresh pork outlook is positive, while packaged meats is less optimistic.