Glanbia plc, the global nutritional solutions and cheese group has issued an Interim Management Statement in accordance with the reporting requirements of the EU Transparency Directive, for the four month period to 27 April 2013. Total Group revenue grew almost 9% in the four months to the end of April compared to the same period in 2012. This comprised approximately 5% volume and 4% price growth.
Commenting on the results, John Moloney, Group Managing Director said: "Overall the Group delivered a solid performance in the first four months of 2013. Trading is in line with expectations and we expect this trend to continue with growth driven by our US Cheese & Global Nutritionals segment and, in particular, Performance Nutrition. However, in parts of our portfolio there are some challenges, as indicated in our full year 2012 results, with market conditions expected to lead to lower year-on-year performances in Ingredient Technologies and Consumer Products. We expect first half earnings growth to be stronger than the second half due primarily to the timing of market price movements. We reiterate our guidance of 8% to 10% year-on-year growth in adjusted earnings per share, on a constant currency basis.
This guidance is from a 2012 base of 51.02 cents, which takes account of the dilutive effect of our 2012 Irish dairy processing transaction."
Revenue for US Cheese & Global Nutritionals for the period grew 14% compared to the same period last year. Volumes grew over 8% and price increases contributed close to 4%. The positive impact of the acquisition of Aseptic Solutions, which was completed in July 2012, was 2%.
Consistent with global dairy market trends, US cheese prices in the period to April were higher than the same period in 2012. Cheese demand was robust during the period and volumes were ahead year-on-year. However, these positive factors were offset by an increase in milk cost which resulted in a broadly similar performance by US Cheese when compared with the first four months of last year. Construction of an $11 million cheese innovation centre in Idaho is well advanced and this new facility is on target for commissioning in July 2013. This investment was complemented by the acquisition of a small specialist cheese plant in Blackfoot, Idaho in March this year. The performance of US Cheese for the first half and the full year of 2013 is forecast to be somewhat ahead of 2012 supported by the Blackfoot acquisition, ongoing product innovation and good operational execution of cost reduction initiatives under the Glanbia Performance System.
While high end whey prices remained relatively strong, overall whey market prices for the first four months of the year were behind prior year levels as predicted and this resulted in reduced pricing in Ingredient Technologies. However this was largely offset by volume growth in the period due to increased throughput of WPC34 and lactose together with the impact of Aseptic Solutions, acquired in July 2012. As a result the performance of Ingredient Technologies was broadly in line with the prior year.
Construction of a new $29 million value-added grain ingredients plant, which will produce flax, chia and other nutrient dense ingredient products, has commenced and is expected to be commissioned in the second half of 2013. Overall the performance of Ingredient Technologies for the first half and full year is expected to be behind a strong 2012, as lower overall market pricing conditions are expected to prevail for the remainder of the year.
Revenue for Customised Premix Solutions for the first four months was in line with the prior year reflecting stable volumes and pricing. This volume performance is in contrast to the strong growth momentum in recent years and reflects short term timing issues associated with customer orders. Market trends remain robust with expected continued growth in demand for customised premix solutions in key market segments including beverages, breakfast cereals, infant formula, supplements and nutrition bars. The 2013 outlook for Customised Premix Solutions is for the business to deliver a first half performance broadly in line with 2012 with growth expected in the second half and for the full year.
