Kerry turnover to hit €4bn
Kerry is expected to come close to €4 billion turnover while Glanbia is due to deliver turnover of €1.8bn, less than half the Kerry outturn.
Expect no shocks from Kerry is the general view.
Results will be good and profits will show earnings up by 11% to 12%, which has become the norm for the group in recent years.
There was a time when that was significantly higher, but times have changed and food competition is so intense that margins have been trimmed.
Kerry still enjoys an operating margin of over 8% and that's unlikely to change. In the months ahead the markets are anticipating the group will be in the hunt for some major acquisitions.
Charles Hansen, a food ingredients group, is for sale for an asking price believed to be e1bn while Degussa, a German chemicals company is selling its ingredients operations for an estimated €750 million.
Whether Kerry acquires either is difficult to say. Liam Igoe of Goodbody Stockbrokers says competition for both is intense. And it has never been Kerry policy to pay over the odds. Kerry pulls about two thirds of profits from its global ingredients operations and it remains the core focus of future strategy.
Pre-tax profits of €230m approximately are on the cards on turnover expected to come in at somewhere around €4bn for the year.
Glanbia, by comparison, is still moving through a transition period, that many expect will redefine its operations that are heavily biased towards the dairy sector.
Pig meat products form part of the consumer division.
Since John Moloney took over as chief executive the group has edged towards the speciality protein market aimed at giving consumers a better nutritional and health pay back from what they eat and drink.
This is very much niche market stuff, but it is an area showing massive growth.
Ingredients currently constitutes 37% of operating profit against 48% for consumer goods and agri 15%.
In 2003 Glanbia losses hit €14.9m well up on the losses in 2002 of just over €8m.
This year the group is due to deliver profits before tax of €77.6m, marking a definitive shift in outlook for the Kilkenny-headquartered business which was formed out of the merger between Avonmore and Waterford Foods which were both plcs in their own right.
Just recently Glanbia reached agreement with Dairygold to buy its Cork milk plant for over €10m.
Times are changing rapidly in Glanbia, but it lacks a track record to justify heavy buying of the shares.
However the change in fortunes for the group has been quite marked in the past few years.
Its shares hit an all time low in 2001 of 42 cent as it went through the horrors of rationalisation.
They hit a high of 305 cent recently, its best level in nearly five years and are presently trading at 285 cent. Continuing steady profit growth should see the shares continuing to gain ground.
