GLANBIA’S Group Managing Director has spoken of her ‘exceptional pride’ in how the group’s staff has responded to the challenges posed by Covid-19.
Speaking after the publication of the group’s Financial Year (FY) statement for 2020, Siobhán Talbot said that Glanbia has retained its purpose and values, “delivering essential, nutritious food during the most challenging of circumstances and proving the resilience of our business”.
“We delivered on our priorities of protecting our people, continuing the supply of food and maintaining our strong financial position. We kept our operations running safely with the aid of enhanced health and safety measures.”
The 2020 FY Report noted the group’s “resilient performance” last year, with revenues coming in at €3,823.1 million, compared to €3,875.7m on 2019 with operating cash flow coming in at €334.8m (2019: €279.9).
Glanbia’s total group profit for 2020 came to €175.3m, a reduction of €39.5m on the previous year.
Adjusted earnings per share last year stood at 73.78 cent, a decrease on the previous year of 14.9 per cent in constant currency terms. Including exceptional costs, basic earnings per share was 48.72 cent (2019: 61.04 cent).
The Board of Glanbia has recommended a final dividend of 15.94 cent per share, bringing the total dividend for the year to 26.62 cent per share, in line with the prior year.
The report notes that “This total dividend represents a return of over €78 million to shareholders from 2020 earnings and a payout ratio of 36.1% of 2020 adjusted earnings per share. While the planned 2020 dividend payout ratio is marginally ahead of the target payout ratio of 25% to 35%, the Board has decided to maintain the dividend in line with prior year due to the strong cash performance during 2020, the reduction in net debt during the year and the robust financial position of the Group. The final dividend will be paid on 7 May 2021 to shareholders on the share register on 26 March 2021.”
A Covid interrupted year
Said Ms Talbot: “A good start to 2020 was severely impacted by Covid-19 in the second quarter but improved market conditions and focused actions drove a sequential improvement in earnings in the second half of 2020.
“Our focused approach to liquidity resulted in cash conversion of over 122% and our financial position has improved materially with net debt reducing by over €120 million during the course of 2020.
“We also maintained delivery of our strategic agenda by making significant progress on Glanbia Performance Nutrition’s (GPN) transformation programme; keeping all major projects on track, which included the completion of construction of two new large-scale JV plants; completing the Foodarom acquisition in Global Nutritionals (GN); and launching a €50 million share buyback programme to enhance shareholder returns whilst maintaining our dividend level. This pandemic is by no means over and we remain vigilant in managing the risks associated with it but we are confident that earnings growth will be restored in 2021.”
Looking ahead, Ms Talbot believes the “the disruptive impact of Covid-19 will abate…and based on this we expect adjusted Earnings Per Share (EPS) to increase by 6% to 12% on a constant currency basis in FY 2021 with growth driven by both wholly-owned businesses of GPN and GN. We anticipate that 2021 will see consumers continue to focus on health and wellbeing: prioritising functional nutrition including immunity enhancing products; maintaining a healthy weight; and supplementing protein-rich foods to support performance and healthy lifestyle goals. This positions Glanbia very well for the future given our core focus on nutrition, health and wellbeing.”
Glanbia also chose yesterday’s FY release to “outline the evolution” of its ‘Pure Food + Pure Planet’ sustainability strategy.
Said Siobhán Talbot: “As part of this strategy, we are signing up to Science Based Targets and aiming to reduce manufacturing emissions by 30% and supply chain emission intensity by 25 per cent by 2030, while achieving net zero carbon emissions no later than 2050. We also launched our diversity and inclusion strategy which will continue to foster a strong and inclusive culture in our organisation.” The next Glanbia AGM is due to be held on Thursday, May 6.