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Thursday 14 December 2017

Glanbia sees profits soar as sales top €3.5bn

Glanbia shares jumped after the Kilkenny-based dairy company posted good results yesterday.

The company reported the fifth year of consecutive double digit growth as its Irish dairy operations improved.

Group sales advanced 6.9pc to €3.5bn, but pre-tax profits dipped slightly to €173m.

Siobhan Talbot, group managing director, said Glanbia will look to buy more businesses. She added that the company was "very pleased" with its acquisition of sports nutrition companies Isopure and Nutramino last year.

"We are a nice blend of both organic development and acquisitions, so I think our stakeholders have liked the fact that our growth trajectory is coming from both sides," Ms Talbot said.

"It's hard to be prescriptive about the timing of [future acquisitions] as it's about getting all of the variables lined up."

She said the company could borrow €250m to help pay for takeovers.

"Clearly for something bigger than that, if it was the right opportunity, we would believe that we would get shareholder support for equity," Ms Talbot said.

The Glanbia boss said she thinks the removal of milk quotas on April 1 will give a "very strong opportunity" to the Irish dairy industry.

Glanbia Ingredients Ireland, a joint venture between Glanbia and Glanbia Cooperative Society that exports milk products, recently finished building a €150m milk processing factory in Co Kilkenny.

"We're very ambitious for the growth of that business ... we're very much investing behind that," Ms Talbot said.

Ms Talbot said it was hard to predict how volatile the milk market would be after the quotas are lifted.

"I think the important thing to remember in that context is that Ireland's output would grow quite dramatically and we would still be a small player on a global scale.

"So global dairy prices are going to be more responsive to things like weather events and various supply dynamics across the big milk-producing regions such as Oceania or the US."

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