Glanbia offloads meat production for innovation aims
processing business as it looks to focus on diversifying its
earnings base towards higher-value ingredients and cheese.
The Ireland-based dairy and ingredients firm said that talks were ongoing with a management buyout team over purchasing the Glanbia meats division. The bidding group is being led by the current chief executive of Glanbia meats, Jim Hanley, the company added. As manufacturers throughout food and beverage industry are forced to counter increased commodity costs, Glanbia said that the move reflected the company's long-term aims to focus specifically on its core strategic growth areas. A spokesperson for the group told DairyReporter.com that selling off the division would allow the company to better invest in nutrition and cheese production, with further acquisitions in these areas still possible. The move by Glanbia to exit meat processing represents a significant step towards its long stated innovation aims. According to the company, Glanbia Meats, which operates from four sites in Ireland, is the country's leading pork processor, producing a range of bacon and pig-meat products for both domestic and international markets. In 2007, the division processed 1.2m animals, amounting to 48.7 per cent of the national supply, according to the company. This output was down slightly over the previous year though, after the Edenderry facility was severly damaged by fire last August, halting production for three months. Despite the significance of the division to national pork production, Glanbia appears to be confident in its plan to focus on cheese and nutrition production. Group managing director John Moloney said earlier this month that the company's fiscal year to date performance had been very satisfactory on the back of its investment plan. "Whilst global dairy markets continue to evolve as we enter 2008, the outlook for Glanbia this year is positive," he stated. "As a group we are continuing to invest and focus on growth and innovation, combined with competitiveness and productivity, and Glanbia is placed for sustained double digit growth going forward." In August, when the group reported its half-year results, group earnings were seen to have risen some 13 per cent to €1,040.3m. Earnings per share were up 26 per cent to 11.47 c. At that time, Glanbia revised its earnings guidance per share to the "high teens" for the full year. Operating profit for the half had increased by 33 per cent to €48.5m on the prior year period.
