WH Group Warns of 56% First-Quarter Profit Drop
The Hong Kong-listed pork producer cites weak U.S. pork margins and elevated hog costs in preliminary unaudited figures for the quarter ended March 31, 2023.
Updated on Nov. 3, 2026 in Agriculture
WH Group, the Hong Kong-listed owner of pork processor Smithfield Foods, issued a profit warning forecasting its first-quarter 2023 profit will fall 56% from US $395 million in the same period of 2022. The company filed the preliminary outlook with the Stock Exchange of Hong Kong.
Why it matters
The decline reflects challenging conditions in the U.S. pork segment, where hog raising costs remain elevated and softer consumer demand has weighed on pork prices. A significant year-over-year drop in the industry gross cut-out margin signals pressure across the sector.
The projection is drawn from preliminary, unaudited management accounts and compares against US $395 million in first-quarter 2022 profit. Final audited figures are still pending and could differ from the preliminary estimate.
The players
WH Group
WH Group is a Hong Kong-listed food company and the world's largest pork producer, owning U.S. processor Smithfield Foods.
The details
The profit outlook excludes biological fair value adjustments and attributes the decline mainly to challenging market conditions in WH Group's U.S. pork segment. Management described hog raising costs as still elevated and pork prices as adversely affected by softer consumer demand.
Timeline
Dec. 31, 2022: Fiscal year 2022 ends with US $1.4 billion in profit attributable to owners.
March 31, 2023: First-quarter 2023 period ends; the preliminary figures cover this window.
Late April 2023: Official unaudited quarterly results are expected to be published.
Market Landscape
WH Group's 34.3% profit increase to US $1.4 billion in fiscal 2022 set a strong baseline that the first-quarter 2023 warning now reverses. The swing highlights how sharply U.S. pork margins can move when hog costs stay high while consumer demand softens.
Lower pork margins can eventually influence retail pork prices and product availability for shoppers. Households may see shifts in grocery costs as producers adjust to higher hog expenses and weaker demand.
The takeaway
A sharp swing from fiscal 2022 growth to a first-quarter warning shows how quickly pork producers' profitability can shift with feed-driven costs and demand. Watching the official late-April results will reveal whether the pressure is temporary or persistent.
What happens next
WH Group is expected to publish its official unaudited quarterly results in late April 2023, which will confirm or revise the preliminary profit figures.
Further reading
Track more coverage in the Agriculture section for context on commodity pricing and meat producers.
Source note: This article includes information reported by National Hog Farmer.
