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(Alliance News) - Glanbia PLC on Wednesday said profit in the first half of 2023 rose despite revenue falling, due to effective cost cutting, while it outlined a new chief executive officer to replace its retiring managing director.
The Kilkenny, Ireland-based nutrition firm said pretax profit in the six months that ended July 1 rose 36% to USD214.0 million from USD157.6 million a year earlier.
This was despite revenue falling 10% to USD2.77 billion from USD3.09 billion. Cost of goods sold fell 3.1% to USD2.47 billion from USD2.55 billion, while administration expenses more than halved to USD44.2 million from USD111.0 million. Selling and distribution expenses fell 6.0% to USD227.4 million from USD241.9 million.
"This was driven by a strong operating performance, continued demand for our better nutrition brands and ingredients and the exceptional commitment of our people," said Managing Director Siobhan Talbot.
"First half performance was in line with expectations, as customer supply chain rebalancing trends reduced volumes, with progressive improvements in demand trends as the period progressed which we expect to continue into the second half of the year."
Glanbia upped its interim dividend by 10% to 14.22 euro cents each to shareholders, while also returning EUR64.5 million over the half-year period via share buybacks.
Looking ahead, Glanbia said it upgraded its adjusted earnings per share guidance to 12% to 15% growth for 2023 on constant currency term, based on its first half results and the "continued momentum" in Glanbia Performance Nutrition.
"Our strategy is on track as we continue to reshape and simplify our portfolio, invest to sustain consumer and customer relevance, drive margin improvement and deliver strong operating returns and cash conversion," said Talbot.
"As we look to the second half of the year, we believe that the combination of market opportunity and our strong operating capabilities set us up for sustained delivery of future growth."
Glanbia also said Talbot had notified the company of her intention to retire following "10 successful years" as managing director. She will step down from her position and the board on December 31 and formally retire in the new year.
Glanbia Performance Nutrition CEO Hugh McGuire has been named CEO of the group, effective January 1, when he will join the board as an executive director.
"A deeply principled and values driven leader, Siobhan has provided outstanding strategic direction to Glanbia, reshaping the business and its culture to become a clear leader in the world of better nutrition. She led the creation of a focused business which is aligned to growing consumer trends with clear purpose and values, a strong balance sheet and continued ambition for growth which are all key parts of her distinguished legacy," said Glanbia Chair Donard Gaynor.
"The CEO appointment was the conclusion of an extensive selection process led by the board's nomination and governance committee with the support of an executive search firm. Hugh has led the growth and evolution of [Glanbia Performance Nutrition] with unrelenting focus to become a global leader and a key earnings generator. He combines a passion for our business and our served markets with entrepreneurial flair and a growth mind-set. I have known Hugh since I have joined the board and I know he is committed to Glanbia's success and is the ideal leader to take us through to the next phase of our growth and evolution."
Soon-to-be CEO McGuire commented: "Siobhan leaves Glanbia in a very strong position for future growth and I'd like to sincerely thank her for all her support over the years. My focus will be to build upon these strong foundations for the benefit of all stakeholders in the years to come... I look forward to working with my colleagues globally to capture the growth opportunities ahead, to sustainably create shareholder value and achieve our full potential as a better nutrition business."
Shares in Glanbia were up 2.5% to EUR14.55 each in London on Wednesday morning.
By Greg Rosenvinge, Alliance News reporter
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