Glanbia Raises Full-Year Earnings Outlook Following 'Strong' First Half

By Steve Wynne-Jones
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Glanbia Raises Full-Year Earnings Outlook Following 'Strong' First Half

Nutrition group Glanbia has raised its full-year earnings expectations following a first half that it said was 'ahead of expectations'.

In a trading update ahead of the publication of its half-year results on 12 August, the Irish group said that wholly-owned revenues were up 20% on a constant currency basis in the first half (+11% reported), due to 'very strong demand' across both its Glanbia Performance Nutrition (GPN) and Glanbia Nutritionals, Nutritional Solutions (GN, NS) businesses.

It said that both GPN and GN NS both delivered 'strong EBITA margins' in the half-year period, due to positive operating leverage, mix and realisation of benefits from the GPN transformation programme.

Elsewhere, its Joint Ventures business delivered a performance in line with the previous year, it said.

Raised Earnings Expectations

Glanbia has raised its full-year guidance for adjusted earnings per share (EPS) to 17% to 22% growth on a constant currency basis, compared to the previous year.


This is ahead of the 6% to 12% adjusted EPS growth that the business had originally anticipated.

'Strategic Actions' Enabling Recovery

'While the group remains vigilant to the continued volatile and disruptive potential of the COVID-19 pandemic, strategic actions have enabled a strong recovery in the first half of 2021 from the comparative challenges of 2020,' Glanbia said.

'The strong first half performance positions the group well to navigate expected cost inflation headwinds in the second half while also providing the opportunity to increase investment behind brand marketing and Nutritional Solutions capabilities, to drive long term sustainable growth.'

Analyst Viewpoint

Commenting on its trading update, analyst Cathal Kenny of Davy said that it "confirms strong operational and profit delivery across its growth platforms through the half – underpinned by the recent transformation programme. The out-turn prompts an upward revision to FY21 guidance, with Glanbia now expecting 17-22% constant currency EPS growth.


"We envisage a 4-5% EPS upgrade for FY21. Importantly, the H1 foundation facilitates operational investment for both Nutritional Solutions (NS) and Glanbia Performance Nutrition (GPN) through H2. Positive earnings momentum, allied with improving earnings quality, remains supportive for the equity."

In February, Glanbia said that its outlook for the coming year was 'upbeat', despite the group taking a hit to its Performance Nutrition business.

© 2021 European Supermarket Magazine. Article by Stephen Wynne-Jones. For more A-Brands news, click here. Click subscribe to sign up to ESM: European Supermarket Magazine.

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