HF Foods Group Inc. Common Stock 2026 Q2 Earnings Call
Review the key takeaways and the transcript of this earnings call.
- HF Foods Group reported second quarter 2026 net revenue of $323.8 million, a 2.8% increase year over year, marking the highest quarterly revenue in company history.
- Gross profit was essentially flat at $55 million, with a gross profit margin of 17.0%, down from 17.5% in the prior year quarter due to incremental tariffs.
- Adjusted EBITDA decreased 2% to $13.6 million, with a margin of 4.2% compared to 4.4% in the prior year quarter.
- Net income attributable to HF Foods was $2.6 million, up from $1.2 million in the prior year quarter, driven by an employee retention credit, tariff refunds, and favorable changes in interest rate swap contracts.
- Adjusted net income was $6.4 million, essentially flat year over year, with adjusted earnings per share of $0.12, also flat.
- Capital expenditures for the first six months of 2026 were approximately $20.3 million, including the purchase of a Chicago distribution center, solar investments, capacity expansion, and fleet upgrades.
- After quarter end, HF Foods refinanced and upsized its credit facility, increasing revolving commitments from $125 million to $140 million and refinancing term loans from $95 million to $125 million, extending maturities to 2031 and 2036 respectively.
- On July 17, 2026, HF Foods signed a definitive agreement to acquire Sea Ray Foods, a Canadian importer and distributor of ethnic and specialty frozen seafood, with an expected close in August 2026.
- Sea Ray Foods has grown revenue at roughly 15% annually since 2019, with adjusted EBITDA margins in the mid-teens and an adjusted EBITDA of approximately CAD 9.6 million (about $7 million USD).
- The acquisition is expected to be accretive to margins and EPS from close, supporting a consolidated adjusted EBITDA margin target of 4.5% to 5% plus over the next 3 to 5 years.
- Sea Ray brings six proprietary brands and expands HF Foods' geographic footprint into Canada, with a customer base including retail, wholesale, and restaurants.
- HF Foods continues to focus on organic volume growth, better pricing, and transformation initiatives including sales operations, digital infrastructure, and facilities upgrades.
- The company is optimistic about future M&A opportunities and remains disciplined in capital deployment to strengthen its platform.
STOCKNOW INSIGHTS
Continue with outlook and guidance.
Log in to unlock executive comments and Q&A highlights.
Log in for the full summaryStockNow uses AI to translate and summarize earnings calls. Accuracy and completeness are not guaranteed.
Transcript
Preview the first five paragraphs, organized by speaker.
Please note this conference is being recorded. I would now like to turn the conference over to your moderator today, Jon DeDomenico of ICR.
Please proceed. Hello, everyone. Welcome to HF Foods Group's second quarter 2026 earnings conference call.
Joining me on today's call are Felix Lin, the company's President and Chief Executive Officer, and Paul McGarry, the company's Chief Financial Officer. Before we begin, let me remind everyone that today's discussion contains forward-looking statements based on management's current beliefs and expectations about future events, which are subject to a number of known and unknown risks and uncertainties, including statements regarding our previously announced agreement to acquire Searay Foods and the timing, terms, and anticipated benefits of that transaction. If you refer to HF Foods' earnings release, the Searay acquisition press release, as well as the company's most recent SEC filings, you will see a discussion of factors that could cause the company's actual results to differ materially from those expressed or implied by these forward-looking statements.
The company undertakes no obligation to update or revise these forward-looking statements in the future. In these remarks, the company will make several references to non-GAAP financial measures, including Adjusted EBITDA and non-GAAP diluted earnings per share. We believe that these measures provide investors with a useful perspective on the underlying growth trends of the business and have included in the earnings release a full reconciliation of non-GAAP financial measures to the most comparable GAAP measures. Now, I will turn the call over to Felix.
Hello, everyone. Welcome to HF Foods' second quarter 2026 earnings call. I'll provide a business update, and Paul will speak to our second quarter financial results. Then we will open up the line for Q&A. We continued to build momentum in the second quarter, even as tariff pressure, softer foot traffic, and rising fuel costs continued to weigh on the industry. Net revenue increased 2.8% year-over-year to $323.8 million, our highest-ever quarterly revenue. Gross profit was essentially flat at $55 million for the quarter. Adjusted EBITDA was $13.6 million, down 2% year-over-year, representing a 4.2% margin compared to 4.4% in the prior year quarter.
FULL TRANSCRIPT
Continue the full translated transcript in StockNow.
Log in to unlock every statement, the English original, and speaker-by-speaker history.
Log in for the full transcriptCall participants
7 people spoke on this call — only 2 are shown here.
PARTICIPANT LIST
View participant details in StockNow.
Log in to see executives and analysts, their roles, and complete speaking history.
Log in to view all participantsKeep exploring