Food group Glanbia says it expects to return to earnings growth this year after a 'difficult year' in 2009.
In a trading update for 2009, the group said it saw the impact of the downturn in global dairy markets in the first half of the year, lower cheese prices and a poor economic backdrop with weak consumer demand.
'Strong cost management together with an excellent operational performance could not fully offset an unprecedented trading environment,' Glanbia said.
It said it expects to report adjusted earnings per share of 30 to 31 cent for 2009, in line with revised earnings guidance announced last April.
The food group said that results from Dairy Ireland will be 'considerably lower' than 2008 and said that for most of 2009 the decline in global dairy markets created a very difficult environment for the Irish ingredients division.
It said that prices and returns for dairy processors and suppliers were below the cost of production, which gave rise to a major first time loss in Irish dairy ingredients for the full year.
However, consumer products is expected to report a reasonable result for 2009, underpinned by a major internal cost reduction programme. Its US cheese and global nutritionals division is also expected to deliver results ahead of 2008.
Glanbia says it will make further cost reductions in its Dairy Ireland division this year, with a provision of €15m provided for in 2009.
The company said that trading conditions improved somewhat in the later stages of last year with a lift in global dairy and US cheese markets. However, it warns that markets remains volatile and consumer sentiment is still fragile.
'Glanbia remains cautious at this early stage of the year but based on current economic and dairy market forecasts expect a return to earnings growth in 2010 in the order of 6% to 8%,' today's trading statement said.
Glanbia shares closed up 1.4% at €2.89 in Dublin.
