Glanbia sees revenue grow 9%

Glanbia’s share price has near doubled from around €6 a share on the Irish Stock Exchange in May 2012 to around €11 yesterday on the back of 9% revenue growth for the four months to April.

Viewed over three years, the share value has near quadrupled. Stockbroker Davy has been guiding 8%-10% growth for Glanbia throughout the past year.

In response to Glanbia’s interim statement yesterday, Davy commented: “Results in line, reiterating full-year guidance.” The IMS release coincides with the formal breaking of ground today for the construction of Glanbia Ingredients Ireland Ltd’s (GIIL) new €150m dairy processing facility at Belview Port, Co Kilkenny.

The group’s 9% revenue growth has come from 5% volume and 4% price growth. Revenue for US Cheese & Global Nutritionals grew 14% yoy. Volumes were up 8%, price up 4%.

Aseptic Solutions has grown 2% since it was acquired in Jul 2012. Customised Premix Solutions performed in line with the prior year, with stable volumes and pricing. Ingredient Technologies reported stable revenues. Dairy Ireland’s revenues grew 2% despite mixed trading, while Consumer Foods had a difficult quarter.

“Trading in Dairy Ireland was mixed,” stated Davy. “Agri performance was robust given poor weather conditions and the consequent impact on fertiliser sales. Net debt rose more rapidly than we had anticipated. Nutrition and seasonal expansion at agribusiness. Rolling net debt/EBITDA ratio was 2.1x, which should fall as the year progresses.”

Glanbia’s net debt as of Apr 27 was €459m.

Glanbia Group MD John Moloney said: “Overall, the group delivered a solid performance in the first four months of 2013. Trading is in line with expectations and we expect this to continue with growth driven by our US Cheese & Global Nutritionals segment and, in particular, Performance Nutrition. However, in parts of our portfolio there are some challenges, as indicated in our full year 2012 results for Ingredient Technologies and Consumer Products.

“We expect first-half earnings growth to be stronger than the second half due primarily to the timing of market price movements.” He reiterated guidance of “8%-10% yoy growth in adjusted earnings per share, on a constant currency basis.”