Glanbia plc. has reported an increase in wholly owned revenue of 23.1% for the first nine months of 2022.
The detail has been revealed in the company’s third quarter 2022 interim management statement.
According to the financial report, on a reported basis, reflecting the stronger euro-US dollar (USD) foreign exchange rate, revenue increased 36.8%.
The drivers of the revenue increase, on a constant currency basis, were volume growth of 0.8% across the group, price increase of 20.9% and acquisitions delivering 1.4%.
Glanbia financials
Glanbia Performance Nutrition (GPN) revenue grew by 13.7% constant currency (up 24.8% reported) on the prior year, driven by a 2.2% reduction in volume, favourable pricing of 15.4% and the positive impact of acquisitions of 0.5%.
GPN branded like-for-like revenue grew by 14.4% driven by 15.6% growth in pricing and a volume decline of 1.2%.
GPN continued to have good volume and consumption growth in performance nutrition and healthy lifestyle brands offset by the continuing headwinds in the diet category. Pricing was positive across all GPN brands.
Glanbia Nutritionals (GN) revenues grew 27.4% constant currency (up 42.3% reported) on the prior year, driven by volume growth of 2.2%, price increases of 23.5% and the positive impact of acquisitions of 1.7%.
GN volume growth was driven by growth in the Nutritional Solutions (NS) non-dairy portfolio and US cheese.
Siobhán Talbot, group managing director said: “I am pleased to report that the momentum outlined at our half year has been sustained through the third quarter.
“Consumption trends continue to be resilient across the performance nutrition and healthy lifestyle brand portfolios in GPN. Revenue growth was primarily driven by pricing actions in response to unprecedented inflation.
“The global macro-economic environment continues to be challenging and we are monitoring consumption and inflation trends closely. The strength of our platforms in better nutrition, supported by the combination of pricing actions taken and operational efficiencies achieved, gives us continued confidence that we will deliver strong full year EBITA [Earnings Before Interest, Taxes, and Amortisation] growth,” she added.
Talbot explained that this confidence sees Glanbia updating its full-year guidance to 10% to 13% growth in adjusted earnings per share (EPS), constant currency.
“Based on current foreign exchange rates, our reported adjusted EPS growth is expected to be 26% to 29%,” she stated.
Glanbia outlook
According to the latest financial report, the continued resilience of Glanbia’s better nutrition platforms supports the group’s confidence in its ability to navigate the current external risks, including the challenging economic environment, the impact of geopolitical tensions, and ongoing inflation.
In the absence of any further unanticipated major market disruption, Glanbia expects to deliver strong revenue and earnings growth for 2022.
US cheese revenue increased by 30.5% in the period. This was driven by volume growth of 4.5% and pricing growth of 26.0%.
Volume growth was driven by end market demand and the new joint venture plant in Michigan which was commissioned during 2021. Price increases were aligned to the higher year-on-year market pricing, according to Glanbia.
Share buyback
On September 30, 2022, Glanbia completed its previously announced share buyback programme.
Between June 23, 2022 and September 30, 2022, Glanbia deployed €50 million, repurchasing 4,301,115 ordinary shares on Euronext Dublin at an average price of €11.62.
In the year-to-date, Glanbia has deployed a total of €173.5 million on share buybacks. Glanbia said it will continue to assess the opportunity for share buybacks as part of its broader capital allocation policy.
Debt
Glanbia’s net debt on October 1, 2022 was €749.6 million, which represents an increase of €160.6 million versus the net debt position at the end of the third quarter of 2021, of which €91.9 million relates to the foreign exchange impact of a strong USD.
Investment in working capital is expected to reduce by the year end and the group continues to target a full-year operating cash conversion of 80%.
At the end of quarter three, 2022, the group had €1.3 billion in committed debt facilities.