Glanbia's Dairy Ireland consumer foods portfolio is likely to post a "challenging" H1 performance, according to Davy analyst Cathal Kenny.
Glanbia posts interim results for the first half of the year on Wednesday, which are expected to reflect 'solid momentum' across its business, however, its Dairy Ireland portfolio remains hampered by a challenging retail market here.
"The well-flagged challenges of a competitive retail environment in Ireland and input cost recovery continue to weigh on [the Dairy Ireland] performance," said Kenny. "Margins across the supply chain remain under pressure."
The period in question saw the unveiling of the new Avonmore Protein Milk variant, however, given that the group's H1 covers the six months to 5 July, the uplift from that launch is expected to be minor for this period.
Overall, Kenny expects H1 revenues at Glanbia plc to rise 4.6% year-on-year to €1.29 billion, with the group's Performance Nutrition business the key sales driver for the group.
"Overall the business remains in excellent health, exhibiting an ideal mix of earnings growth, robust returns and capital discipline," sais Kenny. "With the shares up modestly year-to-date, the stock continues to outperform broader European markets."
Kenny added that Glanbia's performance should provide a "solid platform" to enable the company to meet its stated objectives of 8-10% EPS growth.
© 2014 - Checkout Magazine by Stephen Wynne-Jones