TIDMGLB
RNS Number : 0501O
Glanbia PLC
02 November 2016
THIRD QUARTER 2016 INTERIM MANAGEMENT STATEMENT
Good performance in the first nine months of 2016
Reiterating full year guidance of 8%-10% growth in adjusted
earnings per share, constant currency
2 November 2016 - Glanbia plc, the global nutrition group
('Glanbia', the 'Group' or the "plc"), is issuing this Interim
Management Statement for the nine month period to 1 October
2016.
Commenting today, Siobhán Talbot, Group Managing Director
said:
"Glanbia delivered a good performance in the first nine months
of 2016. On a constant currency basis wholly owned revenues grew by
2.4% versus the same period in 2015. All segments of the Group
delivered volume growth in the period as we continue to invest in
developing our portfolio of brands and value-added ingredients to
benefit from the long term consumer trends in nutrition. The
outlook for the remainder of 2016 is positive and we reiterate our
full year guidance of adjusted earnings per share growth of 8% to
10% on a constant currency basis."
Performance update*
In the nine months to 1 October 2016, wholly owned revenue
increased 2.0% on a reported basis and was up 2.4% on a constant
currency basis when compared to the same period in 2015. On a
constant currency basis this was driven by volume growth of 3.9%
and a contribution from acquisitions of 3.6%, offset by price
declines of 5.1% primarily associated with reduced dairy market
prices and brand investment. Total Group Revenue, including Joint
Ventures and Associates, declined 0.4% on a reported basis and grew
0.2% on a constant currency basis.
Glanbia Performance Nutrition (constant currency)
Glanbia Performance Nutrition ('GPN') delivered a good
performance in the first nine months of the year when compared
against the same period in 2015. Revenue increased by 10.9% which
was driven by a strong volume increase of 5.6%, with growth across
all regions demonstrating the continued healthy consumer franchise
for GPN's brands. In addition, the thinkThin acquisition
contributed 10.9% of overall GPN revenue growth. Acquired in
December 2015, thinkThin has performed well in the period with
strong sales momentum across the core range coupled with successful
innovation. Revenue growth in the period was offset by a price
decline of 5.6%, a reduced rate versus earlier in the year and it
is expected this trend will continue for the full year. Overall
revenue mix remained positive with year to date like-for-like
branded revenue growth offsetting continued declines in contract
business. As expected, the competitive landscape in the US was
challenging in quarter three and GPN expects full year
like-for-like branded revenue growth in the low-single digits with
strong volume growth offset by brand investment.
The full year 2016 outlook for GPN is positive with strong year
on year EBITA growth expected. The main drivers are strong margin
progression versus prior year, mid-single digit like-for-like
volume growth and a good contribution from the thinkThin
acquisition. GPN remains focused on innovation as a platform for
branded revenue growth with a solid pipeline of new product
launches in place for the remainder of the year and into 2017.
Glanbia Nutritionals (constant currency)
Glanbia Nutritionals ('GN') delivered a satisfactory performance
in the first nine months of 2016 with a good third quarter. Revenue
declined in the period by 0.8% as volume growth of 3.9% was offset
by a price decline of 4.7%, reflecting lower dairy market pricing.
Volume growth was mainly driven by value-added dairy nutritional
ingredient sales including systems and high-end whey. Dairy market
pricing remained at relatively low levels in the first half of 2016
with some price recovery taking place in the third quarter.
The full year 2016 outlook for GN is for delivery of EBITA and
margin improvement versus 2015 due to growth of both dairy and
non-dairy value-added nutritional ingredient sales.
Dairy Ireland
Dairy Ireland delivered a satisfactory performance in the first
nine months of the year. Revenue in the period declined by 3.3%
which was driven by a price decline of 5.3% as a result of reduced
input prices, offset by a volume increase of 1.7% and a small bolt
on acquisition contributing 0.4% to revenue in the period. Volume
growth was mainly driven by improved value-added branded milk,
fertiliser and animal feed sales versus the same period in
2015.
Joint Ventures & Associates (constant currency)
Revenue from Joint Ventures & Associates declined 6.6% in
the first nine months of 2016 versus prior year. This was driven by
a price decline of 10.3%, as a result of reduced dairy markets,
offset by volume growth of 5.3%, largely associated with increased
milk processed in Glanbia Ingredients Ireland. The impact of the
Nutricima disposal in April 2015 further reduced revenue by 1.6% in
the period.
The full year 2016 outlook expected for Dairy Ireland and Joint
Ventures & Associates is for delivery of moderate EBITA
improvement on prior year.
Financing
Glanbia's net debt at 1 October 2016 was EUR626 million, which
represents a decrease of EUR18 million versus the net debt position
at half year 2016. The full year 2016 net debt to adjusted EBITDA
ratio is expected be below 1.5 times based on current business
activity. Total full year 2016 capital expenditure is expected to
be between EUR100 million and EUR110 million.
Full year outlook
For full year 2016, Glanbia expects to deliver adjusted earnings
per share growth of 8% to 10% on a constant currency basis.
* To eliminate the effects of foreign exchange on reported
numbers all commentary on business performance is on a constant
currency basis. The average Euro US dollar exchange rate for the
first nine months of 2016 was $1.12 compared to $1.11, the average
for the same period in 2015.
Ends
Cautionary statement
This announcement contains forward-looking statements. These
statements have been made by the Directors in good faith based on
the information available to them up to the time of their approval
of this report. Due to the inherent uncertainties, including both
economic and business risk factors underlying such forward looking
information, actual results may differ materially from those
expressed or implied by these forward-looking statements. The
Directors undertake no obligation to update any forward-looking
statements contained in this announcement, whether as a result of
new information, future events, or otherwise.
IMS conference call dial-in details
There will be an analysts' conference call to accompany this
Interim Management Statement at 8.45 a.m. (BST) today.
To listen to the call, please dial-in using the following
numbers:
Ireland UK Europe USA Pass code
-------- --------- ------------ -------- ----------
01 246 0203 427 +44 (0) 203 646 254
5605 1922 427 1922 3370 6962111
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A replay of the call will be available within 24 hours of its
conclusion and will remain available for 30 days. Please see the
link below to the Investor Relations section of the Glanbia plc
website for details:
http://www.glanbia.com/investors/results-centre
For further information contact
Glanbia plc +353 56 777 2200
Mark Garvey, Group Finance Director
Liam Hennigan, Head of Investor Relations +353 86 046 8375
Martha Kavanagh, Head of Media Relations +353 87 646 2006
This information is provided by RNS
The company news service from the London Stock Exchange
END
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