Revenue up 38% for Glanbia nutrition

Global food giant Glanbia has recorded astonishing growth in its nutrition section which saw revenues grow by 38% in the first quarter of 2014 compared to the same period last year.

Glanbia’s Global Performance Nutrition — which manufactures whey protein drinks and sells them under brands such as Optimum Nutrition, BSN, and ABB — saw a huge pick-up in volume across all regions and brands the company said in an interim management statement (IMS).

The managing director of Glanbia, Siobhán Talbot, said the division had performed particularly well in the first quarter of the year.

“Glanbia delivered a good performance in the first three months of 2014. Global Performance Nutrition performed particularly well reflecting very strong revenue growth in both the USA and internationally, supported by the ongoing investment in the business.”

The growth in sales of sports nutrition products pushed total group revenue up 17% in the first quarter of the year as the company’s Irish operations continued to face challenges.

“The results across the rest of the group were as expected. Performance in Global Ingredients in the period was behind the prior year as lower milk throughput in Idaho reduced output of cheese and base whey; Dairy Ireland continued to be challenged while Joint Ventures & Associates’ performance was ahead year-on-year. Overall the outlook for the remainder of the year is positive and we maintain our guidance of 8% to 10% growth in adjusted earnings per share on a constant currency basis,” said Ms Talbot.

It is in the Irish market that the Kilkenny-based company faces its most significant challenges.

The company’s IMS said “Dairy Ireland continued to be challenging”, although it reported that revenues remained in line with last year with a 5% growth in volume and similar 5% decline in price.

The tough market conditions experienced by the Dairy Ireland wing were also experienced in the Consumer Products sector.

“The Irish retail environment remains challenging despite a modest improvement in consumer sentiment. The drive to value, through ever-increasing promotional activity alongside rising own label incidence is impacting margins for both supplier and retailer,” the company said.

Davy analyst Jack Gorman said the company was well positioned to either meet or outperform its predicted full year growth of up to 10%.

“While the pace of growth at Global Performance Nutrition was exceptional in the first quarter, it nevertheless provides an ideal platform for Glanbia to meet or beat its FY guidance of 8%-10% EPS growth (constant currency). Allied to its pipeline of organic investment projects, the group remains very well placed to deliver on its near- and long-term targets.”