Hf Foods Group Inc

HF Foods Group reported its highest ever quarterly revenue of $323.8 million for the second quarter, a 2.8% increase from the prior year, and said its planned acquisition of Searay Foods is expected to be accretive to margins and earnings per share from close, supporting a consolidated adjusted EBITDA margin target of 4.5% to 5% plus over the next three to five years. CEO Xi Lin highlighted that the Searay deal, the company's first transaction outside the United States, brings six proprietary brands and expands its seafood category, which already makes up about 36% of net revenue. CFO Paul McGarry noted the acquisition is expected to close in August 2026, no later than August 31, subject to customary conditions and regulatory approvals. The company also disclosed a post-quarter refinancing that increased its revolving commitments to $140 million and refinanced term loans into $125 million with maturities in July 2031 and July 2036, respectively. Management acknowledged ongoing pressure from tariffs, softer foot traffic, and rising fuel costs, with fuel-related expenses up approximately $1.4 million year-over-year, but expressed confidence that transformation investments are building a foundation for sustainable growth.

HF Foods Group has entered into a definitive agreement to acquire Searay Foods Inc., a Canadian importer and distributor of ethnic and specialty frozen seafood, marking the company's first expansion outside the United States. The transaction is valued at approximately CAD$47.9 million, or about US$35 million, representing roughly 5.0 times Searay's 2025 Adjusted EBITDA of approximately CAD$9.6 million. Consideration will be funded through a combination of cash on hand and HF Foods common stock, with the deal expected to close in the third quarter of 2026. HF Foods stated the acquisition is expected to be immediately accretive to margins and earnings per share, and reaffirmed its target of expanding consolidated Adjusted EBITDA margin to 4.5 to 5.0 percent or more over the next three to five years. Searay, founded in 2000 and headquartered in Richmond, British Columbia, brings a portfolio of six proprietary brands and a revenue compound annual growth rate of approximately 15 percent from fiscal 2019 to 2024.