With strategic acquisitions completed, more planned and a strong focus in the US market, Glanbia announces positive results.
Glanbia, the global nutrition group, announced its 2018 results during the month of February and signalled continued growth and a positive outlook for more of the same, with some new acquisitions in the pipeline.
With much of the group’s activities in the US, Glanbia generates over 80% of its revenues in US Dollars and reports in Euro. (To eliminate the impact of foreign currency exchange rates on the translation of results the Group uses constant currency reporting.)
Commenting on the results announcement, Siobhán Talbot, Group Managing Director, said:
I am pleased to announce 9.0% growth in pro-forma adjusted earnings per share, constant currency, for Glanbia for 2018. This was largely driven by strong volume growth across our business, in particular in the branded portfolio of GPN and the Nutritional Solutions component of GN. Consumer demand for our brands and nutritional ingredients remains strong underpinned by positive long-term global health and wellness trends. Glanbia also delivered a strong cash performance with an operating cash conversion rate in 2018 of 92%.”
Total Group profit in 2018 was €234.0 million, down from the prior year Group profit of €329.4 million—however the 2017 figure included €98.0 million of net exceptional gains relating to a profit on disposal of discontinued operations and a tax credit arising on the reduction of the US federal corporate tax rate.
Glanbia continued to progress its growth strategy in 2018 through strategic investments and complementary acquisitions. During 2018 the Group participated with its strategic joint venture partners in a number of dairy related investments. According to Glanbia, the Group’s priority on acquisitions is to invest to further build and develop the branded portfolio of Glanbia Performance Nutrition (GPN) and the Nutritional Solutions capability in Glanbia Nutritionals (GN).
Further acquisitions were announced along with the financial results. Ms Talbot stated:
We continue to invest in expanding our business and its capabilities and we completed the acquisition of SlimFast in November 2018. Today, I am happy to announce that we have agreed to acquire Watson for $89 million. Watson is a non-dairy ingredient solutions business headquartered in Connecticut, USA. It is a highly complementary addition to our Nutritional Solutions business and will help broaden our capabilities in the ingredients sector.”
With its business very much US-focused, Glanbia is well-placed to weather Brexit instability and the outlook is very positive for the coming year, with the company expecting to grow and drive revenue in line with its key metrics.
“We continue to drive sustainable growth and are on track to deliver our 2022 strategic ambitions,” said Ms Talbot. “The outlook for 2019 is positive and Glanbia expects to deliver 5% to 8% growth in adjusted earnings per share, constant currency. If the Euro : US Dollar exchange rate remains at current levels, the reported 2019 result will be 3% higher than the constant currency outlook.”
Glanbia plans to reorganise the composition of its Board of Directors effective 1 May 2019. The reorganised Board will be comprised of 16 members. As a result of these changes, Glanbia plans to appoint three new Independent Non-Executive Directors during 2019. It has already been revealed Mary Minnick and Richard Laube will join the board as independent non-executive directors on May 1, 2019.
Mary Minnick was previously a partner of Lion Capital LLP, a consumer-focused private equity firm, from 2007 to 2018. Prior to that she was with the Coca Cola company for 23 years, in a variety of senior management positions. She was ranked #85 on Forbes 100 Most Powerful Women.
The second new director, Richard Laube, was CEO of Nobel Biocare, a Swiss listed medical device business, from April 2011 to April 2016. Prior to that Laube served as executive board member of Nestle SA, from April 2005 to September 2010, and served operationally as CEO of Nestle Nutrition.
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