Glanbia issues cautious outlook for 2009

by Keith Nunes
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KILKENNY, IRELAND — While noting his company’s financial results during 2008 were positive, John Moloney, group managing director of Glanbia P.L.C., warned that 2009 is shaping up to be a difficult year.

"We are very pleased with the group’s delivery of approximately 17% growth in adjusted earnings per share in 2008 in line with market expectations," he said. "This represents a good performance given the decline in global dairy markets and weakening consumer sentiment.

"Two-thousand-and-nine is set to be a very challenging year given the severe impact of the ongoing economic and financial turmoil on both developed and emerging economies. In response to this, we continue to critically examine our cost structures, including, as previously announced, a €16 million rationalization program across our businesses to remain cost competitive. In the context of the current unprecedented financial, dairy market and economic uncertainties we are very cautious at this early stage of the year, however, we remain focused on achieving the market consensus earnings growth for 2009."

Glanbia’s International division, which incorporates its food ingredients businesses in Ireland and the United States as well as the company’s Global Nutritionals business, performed strongly, according to Mr. Moloney, with the exception of the Food Ingredients Ireland segment.

Performance of Glanbia’s U.S. Food Ingredients operations and Global Nutritionals business was due to good demand and a reasonable market environment, according to the company. The Nutritionals business also benefited from a first time contribution from Optimum Nutrition which was acquired in August 2008. The performance of Food Ingredients Ireland in the second half of 2008 was significantly impacted by the steep decline in world dairy prices and as a result the imbalance between market pricing and raw material cost, the company said.

Glanbia will issue its financial results for 2008 on March 4.

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