Good First Half Performance by Glanbia
Glanbia plc, the global nutrition group, delivered a good performance in the first half of 2017, driven by its Nutritionals business division. On 2 July 2017, Glanbia completed the sale of its Dairy Ireland operations to form a new joint venture, Glanbia Ireland, which encompasses the businesses of Glanbia Ingredients Ireland and Dairy Ireland. Total net cash proceeds from the transaction is expected to be in excess of €200 million. Glanbia Ireland, which is the largest dairy and agri business in Ireland with 2016 pro-forma revenues in excess of €1.5 billion, is 60% owned by Glanbia Co-operative Society and 40% owned by Glanbia plc.
Glanbia’s wholly owned revenue from continuing operations in the first half was €1.186 billion, an increase of 10% reported (up 7.3% constant currency). The drivers of wholly owned continuing operations revenue growth on a constant currency basis were a 3.1% increase in price, a 1.3% volume improvement and a 2.9% contribution from acquisitions. Wholly owned EBITA from continuing operations was €148.3 million, up 6.6% reported (up 3.5% constant currency). Wholly owned EBITA margins from continuing operations were 12.5%, down 40 basis points reported (down 50bps constant currency).
Glanbia Nutritionals delivered reported revenue growth of 12.2% (9.0% constant currency) and reported EBITA growth of 11.6% (8.1% constant currency) in the first half. The group’s other operation, Glanbia Performance Nutrition, reported revenue growth of 7.6% (5.4% constant currency) and EBITA growth of 3.1% (0.2% constant currency). Glanbia’s Joint Ventures and Associates business delivered strong revenue and EBITA growth of 23.1% (23.2% constant currency) and 84.8% (83.8% constant currency) respectively.
Siobhán Talbot (pictured above), group managing director of Glanbia plc, says: “Glanbia Nutritionals and Joint Ventures were the main drivers of growth in the first half and we believe second half earnings progression will also be driven by Glanbia Performance Nutrition where good organic growth is expected for the remainder of the year. Overall, we reiterate guidance for the full year of pro-forma Adjusted Earnings Per Share growth of 7% to 10% on a constant currency basis.”
Glanbia’s total investment in capital expenditure was €33.3 million in the first half of 2017, of which €19.1 million was strategic investment. The key strategic project completed in the period was a new innovation centre in Glanbia Performance Nutrition in Illinois, USA. Glanbia also completed two acquisitions in the period, Grass Advantage (Amazing Grass) a plant based nutrition brand in the US and B&F Vastgoed (Body & Fit) in the Netherlands, a leading direct to consumer online branded business focused on performance nutrition. The combined cost of both businesses was approximately €168 million.
