DAVY VIEW

The key takeaways from Glanbia’s FY20 result include:(i) improved trajectory for Glanbia Performance Nutrition (GPN) through H2; (ii) impressive cash generation with year-end net debt/EBITDA at 1.7x; and (iii) guidance of 6-12% constant currency (cc) EPS growth, led by EBITA growth for GPN and Glanbia Nutritional (GN). Overall, the FY20 result bookends a challenging year for the GPN business — we expect the breadth of actions taken to rebuild revenue and margin within GPN to accrue through FY21 and FY22. We envisage no material change to forecasts as FX headwinds temper underling constant currency progress. We believe the equity is attractively priced on a free-cash and earnings basis.