Glanbia PLC · EURONEXT:GL9
Glanbia — H1 2005 Earnings Presentation
23 slides from Glanbia's earnings presentation, Aug 31, 2005
Slide 1: A world of dairy
A world of dairy glanbia ingredients
Slide 2: Contents
Contents Page International Financial Reporting Standards (IFRS) 2 Operational Performance 3 Financial Performance 4 Balance Sheet and Cash Flow 6 Agribusiness 7 Consumer Foods 8 Food Ingredients 9 Development 10 2005 Market Commentary 11 Ongoing Initiatives 12 2005 Outlook 13 Supplementary Informat
Slide 3: International Financial Reporting Standards (IFRS)
International Financial Reporting Standards (IFRS) • Interim results are prepared under IFRS. • IFRS restatement had no significant impact on earnings. • IFRS restatement resulted in pension deficit being shown on the Balance Sheet. • All comparisons are based on a restatement of 2004 financial stat
Slide 4: Operational Performance
Operational Performance • H1 earnings broadly in line with H1 2004 • Challenging environment in Agribusiness and Chilled Foods affects results • Agribusiness impacted by effect of the implementation of MTR • Consumer Foods reflects poor performance in Chilled Foods segment • Liquid Milk satisfactory
Slide 5: Financial Performance (continuing operations)
Financial Performance (continuing operations) H1 2005 H1 2004 €’000 Pre exceptional Pre exceptional Turnover up €45.7 million 926,127 880,412 Operating profit down €3.1 million 38,328 41,390 Total financing costs(1) down €2.0 million 7,725 9,675 Profit before tax(2), on a comparable basis(3) down €0
Slide 6: Financial Performance (continuing operations) – Exceptional items
Financial Performance (continuing operations) Exceptional (€’000) H1 2005 H1 2004 Operating profit (2,431) (325) • Includes €6.3m rationalisation costs at Consumer Foods, offset by a foreign exchange credit of €3.9m arising from the implementation of IFRS. Group interest (5,304) - • Cancellation cos
Slide 7: Balance Sheet and Cash Flow
Balance Sheet and Cash Flow • Total financing on a comparable basis increased €25.7m to €286.6m • Investment in development initiatives (CMP, Nigeria, etc.) • Further initiatives to reduce ongoing investment in seasonal working capital • Group refinancing • Early repayment of $100m preferred securit
Slide 8: Agribusiness
Agribusiness • Farm purchasing power impacted by MTR H1 2005 H1 2004 • Volumes reduced, pricing pressure Turnover €142.3m €143.8m • Difficult first half, as expected Operating Profit €7.8m €9.3m Operating Margin 5.4% 6.5% • Key linkage to farmer supply base • Cash generative business • Focus on cont
Slide 9: Consumer Foods
Consumer Foods • H1 reflects challenges in Chilled Foods H1 2005 H1 2004 • Liquid Milk satisfactory but competitive Turnover €242.5m €223.0m • Pigmeat improved but slower than expected Operating Profit €8.5m €10.7m Operating Margin 3.5% 4.8% • Inch rationalisation; one-off cost • New agreements and
Slide 10: Food Ingredients
Food Ingredients • Solid performance H1 2005 H1 2004 • Ireland satisfactory, some margin pressure Turnover €541.3m €513.5m • USA good, strong market and output Operating Profit €22.1m €21.3m Operating Margin 4.1% 4.2% • Nutritionals steady, further organic growth • Kortus sales ahead of expectations
Slide 11: Development
Development • Competitiveness • Addition of CMP liquid milk, cream and juice brands • Rationalisation initiatives at Inch and closure of two Dublin distribution depots • Contract manufacturing on milk processing • Organic growth • Nutritionals and new chilled food product launches • Opening of Group
Slide 12: 2005 Market Commentary
2005 Market Commentary Principle businesses Nutritionals Agribusiness - Central to growth strategy; major HR investment - Challenging market with MTR effects - Grow mainly via capacity expansion, R&D, JV routes - Further efficiency improvements - Continuous evaluation of acquisition pipeline - Ongoi
Slide 13: Ongoing Initiatives
Ongoing Initiatives Business Objectives • Manage impact of EU sector reform to underpin long term sustainable businesses • Focus on continuous improvement in operational and cost efficiency • Accelerate product and process innovation • Build on leading consumer market positions and brand portfolio S
Slide 14: 2005 Outlook
2005 Outlook “The trading environment in Ireland is expected to remain challenging for the remainder of this year. We have taken strong proactive measures on costs, productivity and market positioning and the benefits of these initiatives will flow through during the next year. Given the current dif
Slide 15: Supplementary Information
A world of dairy . foods and nutritional glanbia _isesiens Supplementary Information
Slide 16: About Us
About Us Vision “To be the most relevant player in international cheese, nutrition and selected consumer food markets.” • International Consumer Foods, Food Ingredients and Nutritionals Group • Headquartered in Kilkenny, Ireland • Operations in Ireland, UK, Germany, USA and Nigeria; 4,000 employees
Slide 17: Balance Sheet
H1 2005 H1 2004 Balance Sheet € million € million Property, plant and equipment 322.1 295.8 Investments 94.5 58.5 Intangible assets 44.8 22.2 Non-current receivables 55.9 52.2 Working capital 62.7 121.2 Non-current liabilities (53.9) (54.1) Retirement benefit obligations (net of tax) (139.4) (80.7)
Slide 18: Cash Flow
H1 2005 H1 2004 Cash Flow € million € million Inflows Profit before tax pre exceptional 30.6 31.5 Depreciation and amortisation 13.8 17.1 Disposals - 90.6 Working capital (0.1) (90.4) Tax 0.3 (1.1) 44.6 47.7 Outflows Cash exceptional costs (5.3) - Capital expenditure (21.8) (24.0) Capital expenditur
Slide 19: Market positions: Ireland, Europe, USA
IRELAND No. 1 Dairy processor No. 1 Liquid milk and cream brand No. 1 Cheese and butter processor Market leader in yoghurt and yoghurt drinks No. 1 Pigmeat processor EUROPE No. 1 Pizza cheese supplier USA No. 1 Supplier of key customised nutrient premixes No. 1 Barrel cheese No. 1 Whey protein isola
Slide 20: Nutritionals
Nutritionals • Demand driven - by consumers and manufacturers • Requirement for products with added health benefits • Must have evidenced based nutritional properties • Built on research, science and innovation • Global customer base and positioning possible • Market with strong growth potential Pag
Slide 21: Nutritionals – the Glanbia opportunity
Nutritionals* – the Glanbia opportunity • Controlled source of high quality raw material (whey) • Expertise and competence in production • Quantity to deliver scale and efficiency • Customer based product innovation programmes • Strategy in place to build complimentary capabilities * part of Food In
Slide 22: Contact us
Contact us Glanbia plc Glanbia House Kilkenny Ireland +353 56 777 2200 +353 56 777 2222 Investor Relations: Geoff Meagher, Deputy Group Managing Director/Group Finance Director Siobhan Talbot, Deputy Group Finance Director Media Relations: Geraldine Kearney, Group Director of Corporate Communica
Slide 23: For further information on the Group
For further information on the Group www.glanbia.com