Glanbia upgrades earnings forecast as sports nutrition business outperforms

Glanbia has upgraded its earnings forecast for the year on the back of a better-than-expected performance in the third quarter and an improved outlook for the rest of the year.

The performance was driven by “strong revenue growth” across its performance nutrition division, which is centred on the company’s Optimum Nutrition brand, which makes protein powders for gym goers.

Glanbia is now the biggest seller of sports nutrition products in the United States.

The Kilkenny-based food company said it now expected growth in full-year adjusted earnings per share to be between 17 and 20 per cent on a constant currency basis.

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In a trading update, Glanbia said group revenue for the third quarter declined by 9.1 per cent with growth in Glanbia Performance Nutrition (GPN) offset by a decline in Glanbia Nutritionals (GN).

Glanbia said like-for-like branded revenue in its GPN business increased by 3 per cent, reflecting a price increase of 8.9 per cent and a volume decline of 5.9 per cent. “Pricing reflects 2022 pricing action across all brands; positive sports nutrition volume was offset by volume decline in weight management,” the company said.

Like-for-like revenue declined 14 per cent across the nutritionals business, reflecting a volume decline of 6.4 per cent and a price decline of 7.6 per cent.

The volume decline was driven by “supply chain rebalancing” earlier in the year, Glanbia said.

The food company recently completed a €100 million share buyback, repurchasing 7,215,827 ordinary shares at an average price of €13.86.

Group managing director Siobhán Talbot said: “Glanbia has continued to deliver good momentum during the third quarter which, together with a strong outlook for the remainder of the year results in an upgrade in expected growth in full year adjusted earnings per share to between 17 and 20 per cent on a constant currency basis”.

“The group’s portfolio of better nutrition brands and ingredients continues to resonate strongly with consumers seeking health and wellness, with a particular focus on protein.

“The Optimum Nutrition brand within GPN, delivered strong revenue growth in the period while in GN Nutritional Solutions, overall volume trends have stabilised with volume growth in the third quarter driven by protein solutions,” she said.