Glanbia, the global nutrition group, has recorded a 10.8% rise in earnings for the first half of 2016. Total group revenue fell 1.7% to €1.84bn as a result of challenged dairy markets globally. Despite this, total group earnings (EBITA) increased 11.4% to €176.5m, with margin expansion of 110 basis points to 9.6%.

Siobhán Talbot, Group Managing Director, warned that global dairy markets remain weak and continue to be a challenge for parts of the business. But added that because of the diverse nature of Glanbia’s business, the group was able to reiterate guidance for the full year.

Performance nutrition continued to drive performance, with earnings up 35% to €81.7m. Margins increased 280 basis points to 16.2%. Revenues increased 12% to €505.3m, driven by an 8% improvement in volumes and 10.7% from the thinkThin acquisition. Prices declined 6.7%. The group said the strong US Dollar remains a headwind in certain non US markets.

Another strong set of results

Speaking on Wednesday's edition of Morning Ireland on RTE Radio 1, Siobhán said overall, the brand are happy with the strong set of results. "The results were underpinned by a 35% growth in earnings from the performance nutrition business, the biggest segment of our overall group".

She added that the company were "delighted" to be able to increase their milk price for the first time in months. "We are cautiously optimistic, it will be into 2017 before we see any major move. Its hard to see anything over dramatic in the short term".

Ongoing challenges

Earnings fell 4% to €58m in its ingredients division which has now been rebranded Glanbia nutritionals. The group blamed ongoing challenges in global dairy markets for the weaker performance. Revenues decreased 5.9% to €572.6m. Despite a 2.2% increase in volumes pricing fell by 8.1% compared to the same period last year. Overall margins progressed to 10.1%.

US cheese volumes were broadly in line in the first half of 2016 as plants operated close to full capacity.

Its consumer foods and agribusiness saw a 1.1% increase in earnings to €17.7m.

Revenues decreased 3.3% reflecting a 1.1% increase in volumes, a 4.9% decline in price and a 0.5% revenue contribution from acquisitions. Margins increased 30 basis points to 1.1%, driven by an improvement in sales of value-added branded products and input cost reductions.

Net debt at the end of HY 2016 was €644 million. This is an increase of €67 million relative to the end of HY 2015.

The group is recommending an interim dividend of 5.37 cent per share, an increase of 10% on prior year.