Glanbia ‘exceeded plans’ as revenue jumps 38.5% in first half

Action taken to counter inflation has started to pay off, according to dairy and nutrition company

Glanbia group chief executive Siobhan Talbot

Global nutrition group Glanbia has reported higher revenue for the six months to the end of July and upgraded its full-year guidance for growth despite having to raise prices due to higher input costs, particularly from its dairy supply chain.

Managing director Siobhán Talbot said the company’s latest half-year results had “exceeded plans” and reflected the “resilience” of its customer base. She said Glanbia had maintained revenue growth despite price increases of 14 per cent and 18 per cent across the group’s two pillar businesses, ingredients and performance nutrition, driven by higher dairy, energy and labour costs.

However, she warned that consumers could expect further food price inflation in the coming months as the pass-through of higher production costs plays out.

Half-year revenue at Glanbia reached €2.8 billion, up 38.5 per cent on a reported basis and by almost 27 per cent when the effects of foreign exchange rates were smoothed out, the company’s latest results show. Volumes also rose, with Glanbia Performance Nutrition showing a 1.9 per cent rise on a like-for-like basis, and Nutritional Solutions up 1.6 per cent.

READ MORE

Profit after tax from continuing operations was €121.5 million, down slightly from the previous year’s €122.4 million.

The Kilkenny-based group, which supplies protein products for gym goers and dieters, is a world leader in the performance nutrition sector, worth approximately €20 billion globally. Ms Talbot said Glanbia’s protein powder sales had remained robust because they are priced competitively. The group’s top-selling Optimum Nutrition brand accounts for 53 per cent of revenue from performance nutrition and saw sales in the US increase by 32 per cent in the 12 weeks to June this year.

Glanbia’s adjusted earnings per share beat expectations at 52.31 cent, compared to 48.84 cent a year earlier. Basic earnings per share were 66.13 cent for the period, up from 27.90 cent in the same period of 2021. The interim dividend rose 10 per cent to 12.93 cent per share.

What is the potential economic cost of a united Ireland? (From May 2021)

Listen | 00:00

The group returned €127 million to shareholders through a series of buybacks during the six months.

The period also saw the disposal of Glanbia’s 40 per cent interest in Glanbia Ireland to the co-operative society for €307 million, and the acquisition of US bioactive ingredient company Sterling Technology.

Looking ahead, Glanbia expects strong earnings growth in the second half of the year, upgrading its full-year guidance to 9-13 per cent adjusted EPS constant currency growth, and between 21 and 25 per cent on a reported basis.

“We continue to make progress on our strategic agenda and with the completion of the sale of the company’s minority interest in Glanbia Ireland, Glanbia continues to evolve as a focused, purpose-led global nutrition company,” Ms Talbot said. “We will continue to monitor inflationary trends into the second half of the year but are confident that further pricing action and operational efficiencies will deliver improving margins and strong year-on-year ebita growth.”

Ciara O'Brien

Ciara O'Brien

Ciara O'Brien is an Irish Times business and technology journalist

Eoin Burke-Kennedy

Eoin Burke-Kennedy

Eoin Burke-Kennedy is Economics Correspondent of The Irish Times