Wednesday 24 January 2018

Buoyant year for Glanbia as Co-op members in line for €15,000 payout

Glanbia chairman Liam Herlihy, group finance director Siobhan Talbot and MD John Moloney.
Glanbia chairman Liam Herlihy, group finance director Siobhan Talbot and MD John Moloney.
Peter Flanagan

Peter Flanagan

GLANBIA Co-Op shareholders are set to receive a windfall worth an average of €15,000 today when the co-op distributes its shares to them.

Under the terms of the spin-out of Glanbia's milk processing business, the Glanbia co-op agreed to hand out about 7pc of its holding in Glanbia Plc to its own members.

The payouts, which will begin today, are worth an average of €15,000 per member.

News of the payout came as Glanbia Plc posted annual results that comfortably beat expectations. The company also upped guidance for the year ahead.

The diary and nutritional company said profit for the year after tax and exceptional items rose 22pc to €144.2m on revenue that climbed 14pc to €2.2bn.

Those figures translated into earnings per share of 52.9 cents.

Growth was driven by the US cheese and global nutritionals business, which saw revenues climb 11pc on a constant currency basis, while margins – a sign of the health of the business – increased 80 basis points.

The big area of development on that side of the house came in the so-called 'performance nutritionals' division, led by Glanbia's 'Optimum Nutrition' and 'BSN' brands.

The two divisions, which specialise in supplying protein shakes and other supplements to the consumer market benefited from higher prices and increased demand for their products.

The US cheese business had a "reasonable performance" on the lower prices in the first half of the year.

"Demand for American-style cheese during 2012 continued to be resilient, reflecting positive growth across the domestic retail and food service and export sectors," Glanbia said.

Closer to home, the consumer business in Ireland continued to struggle.

"The Irish food retail environment remains very challenging," company chief executive John Moloney said.

"Consumers are still focused on price, which benefits discount retailers and private label products at the expense of mainstream retailers and branded products," he added.

Flat

Overall, margins in the consumer division were broadly in line with previous years. Glanbia's agri-services division was largely flat due to the bad weather throughout the year.

Looking ahead to 2013, Glanbia is forecasting 8pc to 10pc year-on-year growth in adjusted earnings per share on a constant currency basis.

"There are some headwinds with an uncertain global economic environment and challenging Irish retail environment, but the group is well positioned to maintain its momentum," said Mr Moloney.

These were the first set of annual results since the spin-off of the milk-processing business.

Mr Moloney said the move was progressing well and construction of a new milk processing plant at Belview Port in Co Kilkenny was scheduled to begin before the end of June.

Shares in the company were up for much of the day but closed 0.5pc lower at €8.46.

Irish Independent

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