Glanbia MD answers shareholder questions

Siobhan Talbot who is now seven months into her role as Glanbia Group Managing Director addressed shareholders for the first time today at the Glanbia AGM.

Talbot had the luxury of announcing interim results showing sales growth of 17% in the three months to April, compared to the same time last year. This is despite ‘significant headwinds’ at its Irish business.

Talbot, who received a warm welcome from shareholders present at the AGM today in Kilkenny, was on hand to answer questions from shareholders. Some of the key issues raised included:

Wexford Creamery

“We have competition authority approval and we will move to complete that transaction. A lot of the milk suppliers have been signed up. Obviously it part of the GIIL business. A lot has been done on the ground engaging with suppliers.

“I think Glanbia has spoken continually to our desire to encourage growth. We are spending €150million in Belview alone. Individuals will always make individual choices. For Glanbia it is about presenting what I think is a compelling case in terms of linking yourself to the Glanbia organisation.”

Share Price

“In relation to the share price. The reality is the Glanbia share price was significantly re-rated post the corporate restructuring of 2012. That is sustained through 2013. We have a three-year metric of over 200% in total shareholder return which is the share price plus the dividend. I think the reality is that if we can deliver the type of ambition that we have the share price will respond.

“To be quite honest, I see my job and the job of the management team to do the right thing by Glanbia for the long term. The share price will look after itself.”

Opportunity’s outside the core business

“I would reassure shareholders on the strategic direction of Glanbia. Anything that we would do in a non-dairy sense would only be done if it was very complementary. Because if you think of the core of what we do as an ingredients supplier or a brand owner – we have core knowledge around that area.

“So, when I say that we are interested in non-dairy, for example, we are interested in protein, just not dairy protein. I mean that in the sense that this is something that is complementary to the business. We are interested in flax also because it has fibre, protein and omega 3 and because a lot of that functionality can be combined in dairy, hence our willingness to invest.”

Liquid Milk

“We have a very solid consumer business here. It has been challenged in 2013 and the first half of 2014.

“We are still paying a premium over manufacturing for liquid milk supply. We are the largest brand owner. We are the only business to put investment behind branded milk in Ireland. We are investing in bringing brands of the Island of Ireland. Because we believe they are great brands.

“We never had as challenging a buy sell dynamic that we had in 2013. We it was great at many levels and milk rive was strong. We tried very hard it has to be said in terms of recovering some of that cost.

“But it just wasn’t possible in the Irish market. I do think that the business is very sustainable. We are putting investment behind it. There is a lot of change happening at plant level, because we want the most efferent converter of milk into branded product.”

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