Glanbia looks to grow Asian online sales of nutritional products
20pc of shareholders vote against pay hikes for senior executives
Glanbia is looking at growing online sales of its nutritional products, especially in Asia, Managing Director Siobhan Talbot told the plc’s agm.
While just over 20pc of shareholders voted against a proposal to increase a salary hike for Ms Talbot and Glanbia’s Finance Director Mark Garvey, she told shareholders that health and wellness is one of the biggest global trends among consumers and governments.
Shares in Glanbia were down over 6pc in afternoon trading.
Health and wellness, she said, is a growing global trend with consumers and governments recognising that prevention is much better than medication. “It is a big market, worth over a trillion dollars and is growing globally.”
Glanbia, she said, is looking to combine the consumer desire for nutrition in a convenient offering for time-poor consumers.
She said the group is looking to increase its presence in what she called a “digital connectivity trend”. This, she said, will be done through online sales platforms such as Amazon and the Asian-based e-commerce giant Alibaba, which has 666m regular customers and is a customer of Glanbia.
Glanbia’s acquisition of Body & Fit, a Dutch-based performance nutrition brand that is only available online, she said was playing into this trend with Glanbia looking to leverage that capability.
“Consumers are very connected and people want to do everything on their smart phone. Consumers have real power through their ability and technology. They can damage or endorse brands.”
While two investor groups, Glass Lewis and ISS, had recommended that shareholders vote against the proposal, which sees Ms Talbot receive a pay rise of 22pc and Mr Garvey a 14.9pc pay rise, just over 20pc of shareholders voted against the proposal.
The move sees the base salary for Ms Talbot increase from €859,660 to €1.05m, while Mr Garvey's increases to €581,000. Ms Talbot and Mr Garvey have both signed renewable three-year contracts this year.
Chairman Martin Keane said that with just over 20pc of shareholders voting against the remuneration resolution, Glanbia would engage with shareholders on the matter.
Farmers questions around Ms Talbot's pay, in comparison to the milk price the Glanbia joint venture (Glanbia Ireland) is paying were addressed by Group Chairman Martin Keane who said the matter would be addressed at the co-ops agm in May.
According to Talbot, the plc is pleased with delivering earnings growth of 9pc. Glanbia reported revenue growth of 8.4pc in first quarter of 2019, with 5-8pc adjusted earnings per share growth predicted for full year (constant currency). “We are very comfortable we are off to a good start this year,” Ms Talbot told shareholders.
The plc’s planned revenue growth to €6bn by 2022, she said, will be done in a disciplined, financial way.
“We are undiminished in our ambition,” she said.
Glanbia Performance Nutrition’s target is that 15pc of sales each year is from products launched in the previous three years and it exceeded that to almost 20pc.
Last year the plc bought SlimFast for €313m (US$350m), and Ms Talbot said expected profit margin in the product is 11pc.
Mark Garvey told the agm that reduced US tax rates saw the plc’s US income tax reduce from $38m to $32m in 2018.
Shareholders were also told that anyone who invested €100 in Glanbia shares at the beginning of this year would have seen them rise in value to €111 by the end of 2018.
Chairman Martin Keane said Glanbia is “committed to Ornua in the long term”. Glanbia, he said, owns 25pc of the shares of Ornua and its proportionality with Ornua is holding strong. Glanbia launched a grass-red dairy range in the US, which many saw as being in direct competition to Ornua’s presence in the US.
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