Glanbia shares plunge by over 18% as threat of tariffs cloud future outlook

The food giant posted increased revenues of $3.8bn, underpinned by double-digit sales growth in its sports nutrition brands Optimum Nutrition

Glanbia CEO Hugh McGuire

Shares in Glanbia took its largest plunge since 2007 as the food group warned that a global tariff war could impact its ability to source raw materials and deliver products. 

Concerns over rising costs at the food nutrition company saw its stock sink by more than 18% in Dublin trading on Wednesday morning, more than wiping out its gains for this year.

The Kilkenny-based company also announced a savings plan involving the sale of its underperforming SlimFast brand just seven years after buying it. 

The meal replacement brand has struggled in recent years due to the rise of weight loss drugs like Ozempic, which have transformed people's dieting habits.

The food giant posted increased revenues of $3.8bn (€3.62bn), underpinned by double-digit sales growth in its sports nutrition brands Optimum Nutrition and Isopure, while the group's after-tax profit rose by 4% to $310m (€295m).

Noting tariff threats from US President Donald Trump, the company said this could "potentially impact the importation of key raw materials and/or negatively impact on the group’s international sales channels”.

“The group is holding appropriate safety stocks for core raw materials, however a prolonged impact to supply chains, heightened inflation, the occurrence of extreme weather events and natural disasters, or a geo-political event in a key trading region would have negative consequences from both a supply and pricing perspective,” it said.

Glanbia said it expects to deliver adjusted earnings per share (EPS) between 124c and 130c by the end of 2025.

The company also said that while inflationary pressures are easing, it remains vulnerable to the impact of geopolitical tensions and in particular the possible introduction of tariffs between the US and some of its key trading partners.

The firm is also exiting the Benelux Direct-to-Consumer e-commerce business and is launching a new operating model with three focused divisions: Performance Nutrition, Health and Nutrition and Dairy Nutrition as part of a drive to save at least $50m annually by 2027.

Analysts at Goodbody said Glanbia’s guidance disappointed and they see “no near-term catalyst to drive a re-rating” without more visibility on an improvement in whey prices.

"I am pleased to report that the Group delivered a strong performance in 2024," said Hugh McGuire, CEO of Glanbia.

"Our strong operational and financial performance continued to generate excellent cash flow, with 88.0% cash conversion in 2024.

"We have commenced a multi-year group-wide transformation programme to drive efficiencies and support the next phase of growth. This includes setting up a new operating model, delivering productivity initiatives, and further optimising our portfolio, targeting annual cost savings of at least $50m by 2027. These actions are designed to drive focus, unlock value and position Glanbia for its next phase of growth."

Looking ahead to 2025, Mr McGuire said Glanbia will focus on continuing to drive performance across its portfolio of better nutrition brands and ingredients while navigating short-term input cost inflation.