Glanbia faces 'challenges' despite strong yearly trading
AGRI-FOODS business Glanbia said yesterday that it was still trading in line with previous forecasts but warned its Irish consumer business continues to struggle.
In an interim management statement, the company said that while trading in the second half of this year had been "strong", its Irish consumer foods business, which includes the likes of Avonmore and Premier Dairies, had faced a "challenging" market.
The struggles in the consumer foods business here were offset, however, by the Irish dairy ingredients business which will be "strongly ahead for the full year after a very difficult 2009".
Away from Ireland, the US cheese and global nutritionals sectors, which drive the profits for the rest of the group, were said to be "performing in line with expectations". Although operating profit margin from the two sectors will be lower this year due to reduced US cheese margins and pressure on global nutritionals, overall operating profit is expected to beat last year's operating profit of €90m.
Goodbody Stockbrokers' analyst Killian Murphy welcomed the statement.
"The Dairy Ireland division continues to benefit from the Irish dairy ingredients business and the agribusiness, which are more than offsetting the challenges in the consumer products business," he said. "In terms of outlook, management is anticipating EPS growth of 20pc y-o-y this year and expects to end the year with net debt of some €420m, as a result we expect to leave our FY10 forecasts unchanged," he added.