Glanbia Posts 4.7% Growth in Q1, Reiterates 2018 Guidance
Irish nutrition group Glanbia has posted 4.7% growth in the first quarter of the 2018 financial year, the company announced Wednesday.
In a release of the interim statement for the three-month period ending 31 March 2018, which coincided with the company’s annual general meeting, wholly owned revenue from operations increased by 4.8% (in constant currency).
The group reiterated its full year guidance of 5% to 8% growth in adjusted earnings per share, in constant currency, with growth expected in the second half of 2018.
The company attributed this revenue increase to the 7.2% volume growth in its Performance Nutrition and Nutritional segments. Acquisitions added an extra 3.6% increase in revenue.
However, due to the less robust US dollar to Euro foreign exchange rate, revenue decreased 8.1% on a reported basis, when compared to the same period last year.
Diminished dairy markets and brand investment in Glanbia Performance Nutrition Pricing caused pricing to sink 6% year on year.
Glanbia Performance Nutrition
Glanbia Performance Nutrition (GPN) ‘delivered good revenue growth’ in the first quarter. Revenue rose by 9.3%, kickstarted by volume growth of 5.5%, with the Body & Fit acquisition in the first quarter of 2017 contributing 7.8%. These figures were offset by a price drop of 4%.
‘GPN delivered volume growth in both the US and other key international markets. In the US this was broad-based across key channels. In non-US regions, emerging markets delivered strong growth as GPN continues to benefit from the prior investment in building its international capabilities,’ the company said in a release.
‘Innovation is a central component of the GPN growth strategy and in the period the recently launched ON Cake Bites and BSN Syntha-6 Protein Crisp bars performed well.’
The company said that the segment will keep investing in innovation and brands and forecast EBITA margins for the full year to be ‘broadly in line’ with 2017. The investments will be funded by decreased input costs.
Glanbia Nutritionals And Joint Ventures
The Glanbia Nutritionals (GN) segment saw its revenues rise by 1.1% compared to 2017, boosted by a volume increase of 8.6%. It also saw a price decline of 7.5%. Its full-year outlook is ‘positive’.
Nutritional Solutions, conversely, posted a revenue drop of 3.6%. A volume growth of 2.6% across dairy and non-dairy ingredients was offset by a price drop of 6.2%, largely related to lower year-on-year dairy prices.
The revenue in its US Cheese segment rose by 5%, affected by a 13.7% volume growth due to the ‘timing of customer off-takes’ compared to 2017. Weaker cheese markets year on year caused pricing to drop by 8.7%.
The company added that the project to expand production capacity in the US Southwest Cheese facility by one-quarter is nearly complete, with commissioning expected to be finished in the second quarter.
Joint venture revenue posted a 29.7% increase. The creation of Glanbia Ireland contributed 34.8% revenue growth, and a volume growth of 4.3%, offset by a price fall of 9.4% (due to comparatively reduced year-on-year dairy markets). This caused the earnings outlook for joint ventures to fall in 2018 versus 2017, particularly in the first half of the financial year.
In 2017, Glanbia posted a 10.2% increase in pro-forma adjusted earnings per share, its eighth successive year of double-digit earnings growth. Revenue rose 9.2% at constant currency levels.
© 2018 European Supermarket Magazine – your source for the latest retail news. Article by Karen Henderson. Click subscribe to sign up to ESM: European Supermarket Magazine.