6 days ago
Glanbia raises full year earnings guidance, names new chairman
Shares in nutrition supplement maker Glanbia jumped 12% in early trade in Dublin today after it increased its full-year earnings outlook and said it was overcoming challenges that pushed its shares to a two-year low in February.
Glanbia also said today that its independent non-executive director Paul Duffy will succeed Donard Gaynor as Chair of the Company on January 1, 2026.
In its results statement today, Glanbia said it expected full-year earnings per share of $1.30-$1.33 on an adjusted basis, up from its previous forecast of $1.24-$1.30. The firm earned $1.40 per share last year.
The US-focused company reported "strong growth" in its Health & Nutrition and Dairy Nutrition businesses and "sequential improvement" in Performance Nutrition.
The company is not seeing any consumer weakness in the US and the impact of tariffs is "manageable", its chief financial officer Mark Garvey said after the release of the results.
"You never know with today's market when you are, but certainly I feel a lot better than I did three months ago," Mr Garvey said.
Glanbia in February issued a profit warning, in part due to a rise in the cost of whey - a key ingredient in the protein powders and shakes popular with gym goers. Whey prices now look likely to moderate next year as more capacity comes on stream, Garvey said.
The firm in April reported lower revenue from performance nutrition products in US club retailers and speciality channels, but in the second quarter of the year saw positive volumes and pricing through those channels, Garvey said.
"We're going to pass that club channel challenge that we had," Mr Garvey said.
Glanbia said that group revenues for the six months to July 5 increased by 6% to $1.93 billion from $1.82 billion the same time last year, mainly down to price increases and the impact of acquisitions.
But its group EBITDA, before exceptionals, fell by 7.5% to $241.3m from $261.6m, while its adjusted earnings per share of 63.03 cent was also 7.5% lower on the figure of 68.20 cent reported last year.
The company said it was making good progress on its transformation programme, targeting annual savings of at least $50m a year by 2027.
It said its board is recommending an interim dividend of 17.20 cent per share, a 10% hike of the interim dividend of 15.64 cent per share last year.
Hugh McGuire, Glanbia's chief executive, said the results reflect a first half of significant execution and progress as it generated 6% revenue growth, underpinned by strong growth in the Health & Nutrition and Diary Nutrition divisions and a sequential improvement in its Performance Nutrition division as it navigated "significant macroeconomic volatility".
"First half results were driven by volume growth, earnings and margin progression in H&N and DN, reflecting strong customer demand. This was offset by anticipated reduced performance in PN primarily as a result of elevated whey costs during the period," Mr McGuire said.
"We delivered strong operating returns and cash conversion and continue to have a disciplined approach to capital allocation, with a 10% increase in the interim dividend and €62.8 million returned to shareholders via share buyback programmes during the period," the CEO said.
"We are today upgrading our full year adjusted EPS guidance to 130 to 133 cent as a result of increased revenue momentum in PN and improved margins in H&N. The category trends remain positive, and we expect to see continued improvement in volumes across PN in the second half of the year with continued momentum in H&N and DN," he added,
The company today also announced a deal to acquire Sweetmix, a Brazil-based nutritional premix and ingredients solutions business, which it said will facilitate continued growth in the Latin America region.
Glanbia names Duffy as new chairman
Meanwhile, the company also said today that its independent non-executive director Paul Duffy will succeed Donard Gaynor as Chair next year.
Mr Gaynor will retire as Chair and from the Board of the company on December 31.
Mr Duffy has been a director of Glanbia since March 2021 and has significant global business experience in the consumer sector. He is a member of the company's nomination & Governance and Remuneration Committees as well as Chair of the Audit Committee.
He is a former Chairman and CEO of Pernod Ricard North America and during his 25 year career with Pernod Ricard, Paul held a number of senior leadership positions including serving as Chairman and CEO roles at Pernod Ricard UK, The Absolut Company (Sweden) and Irish Distillers.
Paul is a Fellow of Chartered Accountants Ireland and is a graduate of Trinity College Dublin, Ireland. He is a Non-Executive Director of Hostelworld, WA Baxter & Sons and former Chairman of Irish Children's Museum.
Breaking down its divisions, Glanbia said that revenues at its Performance Nutrition unit fell by 3.6% to $850m from $882.1, while EBITDA dropped by 30.8% to $108.2m from $156.4m with the decline mainly due to anticipated challenges in the US club and speciality channels and declines in non-core brands.
It noted that price increases that were implemented across international markets during the first quarter of the year were offset by some tactical price reductions on specific products globally.
Revenues at its Health & Nutrition division rose by 18.4% to $313m from $264.3m and EBITDA jumped by 36.2% to $60.9m from $44.7m the same time last year, driven by a 6.9% increase in volume and an 11.5% increase from the impact of acquisitions.
Meanwhile, revenues at its Dairy Nutrition division rose by 14.1% to $763.7m from $669.2m while EBITDA rose by 19.3% to $72.2m from $60.5m on the back of a 4.3% increase in volume and a 9.8% increase in price driven by favourable dairy markets and strong whey protein demand.
