Glanbia plc Announces Strong Half-Year Financial Results for 2024
Source: DairyNews.today
Glanbia plc, recognized as the ‘Better Nutrition company,’ has reported its financial results for the six-month period ending 29 June 2024, showcasing robust performance and strategic growth initiatives.
Group Financial Highlights:
Adjusted EPS: Increased by 12.4% on a constant currency basis to 68.20 $cent, compared to 60.78 $cent in HY 2023, reflecting solid earnings growth.
Group Revenues: Reported at $1.82 billion, a slight decline of 1.1% on a constant currency basis compared to $1.84 billion in HY 2023. This decrease was primarily driven by a 4.0% reduction in pricing, partially offset by a 1.8% increase in volume and a 1.1% contribution from acquisitions.
Group EBITDA: Pre-exceptional EBITDA rose to $261.6 million, marking a 12.8% increase on a constant currency basis (12.7% reported), with an improved EBITDA margin of 14.4%, up 180bps from the previous year.
Basic EPS: Declined to 54.71 $cent from 71.90 $cent in HY 2023, reflecting the impact of various exceptional items.
Performance by Segment:
Glanbia Performance Nutrition (GPN)
Volume Growth: Achieved a 3.1% increase in volume, although pricing adjustments resulted in a 0.8% decrease in revenue on a like-for-like basis.
Optimum Nutrition: The flagship brand demonstrated strong performance with a 7.7% increase in like-for-like revenue, driven by an 11.8% growth in volume.
EBITDA Margin: Significantly improved to 17.7%, up 420bps from 13.5% in HY 2023, highlighting strong consumer demand and operational efficiency.
Glanbia Nutritionals - Nutritional Solutions (GN NS)
Volume Growth: Recorded a 3.1% increase, driven by strong demand in the premix solutions business. However, pricing pressures resulted in a 0.8% revenue decline on a like-for-like basis.
EBITDA Margin: Slightly decreased to 17.7%, down 60bps from 18.3% in HY 2023, due to ongoing market challenges.
CEO Commentary:
Hugh McGuire, Chief Executive Officer, expressed satisfaction with the company’s first-half performance, noting, “Glanbia delivered a strong performance, with adjusted EPS growth of 12.4% driven by volume growth across our Better Nutrition platforms. Our flagship brand, Optimum Nutrition, continues to lead the market, supported by strategic marketing investments. Our earnings growth, particularly in the GPN segment, reflects robust consumer demand and our commitment to quality and innovation. As we move forward, we remain focused on driving growth across our portfolio, with positive category trends and strong consumer and customer demand supporting our outlook.”
Strategic and Financial Developments:
Shareholder Returns: The company continued to prioritize shareholder returns, increasing the interim dividend by 10% and completing a €50 million share buyback. A further €50 million buyback program has been announced.
US Joint Venture: Effective from 1 January 2024, Glanbia has amended its commercial arrangements with its US joint venture. This change will impact revenue and cost of sales recognition starting in 2024, aligning with IFRS 15 requirements.
Capital Investment: Total capital expenditure for the first half of 2024 was $44.9 million, with strategic investments focused on capacity enhancement and operational efficiencies. The company expects total capital expenditure for the year to range between $80 million and $90 million.
Net Debt: As of 29 June 2024, Glanbia’s net debt stood at $645.4 million, an increase driven by the acquisition of Flavor Producers. The company maintains a strong financial position with a net debt to adjusted EBITDA ratio of 1.22 times.
Dividend Declaration:
The Board has recommended an interim dividend of 15.64 €cent per share, representing a 10% increase from the prior year. The dividend will be paid on 4 October 2024, with the company's primary dividend payment currency remaining in Euro.
Glanbia’s strong operational and financial performance in the first half of 2024 positions the company well for continued growth, with a reaffirmed full-year guidance of 5% to 8% growth in adjusted EPS.
Adjusted EPS: Increased by 12.4% on a constant currency basis to 68.20 $cent, compared to 60.78 $cent in HY 2023, reflecting solid earnings growth.
Group Revenues: Reported at $1.82 billion, a slight decline of 1.1% on a constant currency basis compared to $1.84 billion in HY 2023. This decrease was primarily driven by a 4.0% reduction in pricing, partially offset by a 1.8% increase in volume and a 1.1% contribution from acquisitions.
Group EBITDA: Pre-exceptional EBITDA rose to $261.6 million, marking a 12.8% increase on a constant currency basis (12.7% reported), with an improved EBITDA margin of 14.4%, up 180bps from the previous year.
Basic EPS: Declined to 54.71 $cent from 71.90 $cent in HY 2023, reflecting the impact of various exceptional items.
Performance by Segment:
Glanbia Performance Nutrition (GPN)
Volume Growth: Achieved a 3.1% increase in volume, although pricing adjustments resulted in a 0.8% decrease in revenue on a like-for-like basis.
Optimum Nutrition: The flagship brand demonstrated strong performance with a 7.7% increase in like-for-like revenue, driven by an 11.8% growth in volume.
EBITDA Margin: Significantly improved to 17.7%, up 420bps from 13.5% in HY 2023, highlighting strong consumer demand and operational efficiency.
Glanbia Nutritionals - Nutritional Solutions (GN NS)
Volume Growth: Recorded a 3.1% increase, driven by strong demand in the premix solutions business. However, pricing pressures resulted in a 0.8% revenue decline on a like-for-like basis.
EBITDA Margin: Slightly decreased to 17.7%, down 60bps from 18.3% in HY 2023, due to ongoing market challenges.
CEO Commentary:
Hugh McGuire, Chief Executive Officer, expressed satisfaction with the company’s first-half performance, noting, “Glanbia delivered a strong performance, with adjusted EPS growth of 12.4% driven by volume growth across our Better Nutrition platforms. Our flagship brand, Optimum Nutrition, continues to lead the market, supported by strategic marketing investments. Our earnings growth, particularly in the GPN segment, reflects robust consumer demand and our commitment to quality and innovation. As we move forward, we remain focused on driving growth across our portfolio, with positive category trends and strong consumer and customer demand supporting our outlook.”
Strategic and Financial Developments:
Shareholder Returns: The company continued to prioritize shareholder returns, increasing the interim dividend by 10% and completing a €50 million share buyback. A further €50 million buyback program has been announced.
US Joint Venture: Effective from 1 January 2024, Glanbia has amended its commercial arrangements with its US joint venture. This change will impact revenue and cost of sales recognition starting in 2024, aligning with IFRS 15 requirements.
Capital Investment: Total capital expenditure for the first half of 2024 was $44.9 million, with strategic investments focused on capacity enhancement and operational efficiencies. The company expects total capital expenditure for the year to range between $80 million and $90 million.
Net Debt: As of 29 June 2024, Glanbia’s net debt stood at $645.4 million, an increase driven by the acquisition of Flavor Producers. The company maintains a strong financial position with a net debt to adjusted EBITDA ratio of 1.22 times.
Dividend Declaration:
The Board has recommended an interim dividend of 15.64 €cent per share, representing a 10% increase from the prior year. The dividend will be paid on 4 October 2024, with the company's primary dividend payment currency remaining in Euro.
Glanbia’s strong operational and financial performance in the first half of 2024 positions the company well for continued growth, with a reaffirmed full-year guidance of 5% to 8% growth in adjusted EPS.
