Glanbia 13% surge as it eyes €400m deals
Shares in foods giant Glanbia surged 13% as it eyes €400m in further acquisitions on the back of better than anticipated results for 2018.
Chief executive Siobhán Talbot said the firm, whose value soared €700m to over €5.4bn, would look for further acquisitions in the US and other regions. It announced its another US deal, buying non-dairy ingredients firm Watsons for €78.5m.
Earnings before interest, tax and, amortisation, or Ebita, grew 5.2% to around €285m as revenues increased by over 4% to €2.39bn. Earnings per share rose 9%, beating guidance.
Ms Talbot said Glanbia would seek out more acquisitions, based on more joint-ventures for its dairy-focused operations and full buyouts involving its nutrition and sports foods divisions.
Glanbia's €308.5m purchase of SlimFast last year saw the brand post 18% growth in 2018.
"We’re participating with our partners on some very big spends, probably €1bn, within that primary dairy. So when we move from dairy to the wholly-owned businesses of Glanbia Nutritionals and Glanbia Performance Nutrition, it is not unfair at all to say the focus there is on full acquisitions," she said.
Cash numbers were "very good", Ms Talbot said, which gives Glanbia "a good bandwidth to continue to invest".
I would say we are probably looking at €300m to €400m. When it comes to geography, we’re pretty neutral on it. It is probably coincidental that recent opportunities have come up in North America, where we already have a good footprint. If there are opportunities for businesses in other regions that are complementary, we would be very open to that also.
"We would be very keen to continue to acquire.
"We set out our ambition to take the group to €6bn by 2022. In recent years, Glanbia has been very much that blend of acquisition-fuelled growth, and organic growth," she said.
Sports and health and so-called wellness nutrition would continue to fuel growth, according to Ms Talbot.
SlimFast, Optimum Nutrition, BSN and Body & Fit were moving from niche markets into the mainstream, she said.
"We’ve become even clearer ourselves strategically on where those brands will play - the total spectrum historically around sports performance, right through to men and women who are just thinking of their health," she said.
Brokers hailed the results.
Goodbody said it had outperformed in the fourth quarter, while Davy said "the results attest to the strength of Glanbia’s growth algorithm".
