Glanbia to continue on expansion trail

Glanbia will continue to expand via organic growth and acquisitions, managing director of the food group Siobhán Talbot said.

The global nutrition group has just posted 2015 pre-tax profits of €271.0m, up 10.5% in constant currency, and up 29.4% on reported figures for 2014. Group revenues were €3.667bn, down 7.4%. Pre-tax earnings were €310.7m, up 9%.

Adjusted earnings per share of 79.14c were up 10.6% in constant currency, and up 29.4% on reported figures. Analysts at Davy lifted their earnings per share forecast by around 4% to 86c.

The group’s Performance Nutrition division’s protein powders and other products earned Glanbia €135.6m in 2015. Global Ingredients earned €106.6m, and Dairy Ireland €28.8m.

“We are really pleased with the performance,” said Ms Talbot. “This is our sixth consecutive year of double-digit growth. We have done well in recent years; the figures show the underlying strength in the business.”

The group’s joint ventures and associates performed in line with expectations. Operating cash flow improved by €75.2m to €281.4m. The group has recommended a full-year dividend of 12.1c per share, an increase of 10%. Analysts at both Davy and Merrion have endorsed this guidance.

“We’re in constant growth mode,” said Ms Talbot. “We will continue to grow through a blend of organic expansion plus acquisitions. We have banking facilities in place for this growth. Our acquisitions in 2014, [US sports nutrition business] Isopure and [Scandinavian sports nutrition firm] Nutramino have performed well.

“Our strategy is to respond to global megatrends of nutrition as consumers focus on active, healthy lifestyles, seek protein and exert a focus on where their food comes from. Responding to these trends, Glanbia takes pure and clean ingredients including milk, whey and grains and using our expertise, we produce high-quality nutritional ingredients and branded products for consumers worldwide.”

Still a big player in the global dairy industry, Glanbia’s diversified portfolio is now largely insulated against dairy market volatility.

Last December, the group invested €202.4m in acquiring thinkThin, a US-based lifestyle nutrition brand operating in the protein enriched nutrition bar and snacks category. Net sales for thinkThin in the year to the end of December 2015 were $87m (€79m).

In April, Glanbia disposed of its interests in Nutricima, a Nigerian-based developer of dairy-based drinks and powders, to its joint venture partner PZ Cussons for €28.5m. Glanbia said that the impact of this disposal on the group’s 2015 earnings was immaterial.


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