Food and beverage companies on ISEQ account for 25% of market value
26 July 2013
The 2013 edition of the Top 250 Exporters in Ireland and Northern Ireland was launched recently by the Irish Exporters Association (IEA), in association with Investec. Food and drink companies listed on the ISEQ generate combined revenues of €17 billion, accounting for 25% of the total market value of the index. Indigenous food ingredients and preparations firms Kerry Group and Glanbia featured in the Top 20 in the list, in eighth and 17th place respectively.
Aisling Dodgson, head of treasury, Investec, said: "The export sector has a key role to play in helping the economy to grow and allow Ireland emerge as a global player into the future. The continued expansion of the indigenous Irish sector is very encouraging." Over the last year, the sector has had a stellar performance, up 40%, a 6% outperformance relative to the ISEQ. Year to date, the sector is up 12%, slightly underperforming the ISEQ as the market focuses on more cyclical names. Over the past year Glanbia’s share price has effectively doubled, the market clearly rewarding the company’s new focus on nutritionals.
Gerard Moore, head of Irish research, Investec said: "Many of these listed Irish companies have adapted their business models in response to long term trends running through the industry. Such trends include global population growth, the rise of new middle classes in emerging markets and an increasing focus on food safety." Moore said that Kerry has also become much more focused on servicing the food industry rather than actually producing food. Over the past year Kerry has continued to invest heavily in research and development through its innovation centres and is continuing its ‘1 Kerry’ project, which aims to leverage the Group’s scale in order to achieve greater growth and efficiency gains.
Investec said it expects the structural drivers will continue to shape the food and beverage industry. Developing technological capabilities in order to capitalise on these trends together with laying the foundations to achieve economies of scale will be the factors that drive long term profitability. Overall, listed Irish F&B companies are demonstrating impressive agility in responding to these changes and as a result their outlook remains positive.