Directors' Report: Divisional performance38Glanbia plc Annual Report 2011US Cheese & Global Nutritionalswww.glanbia.comResults overview* In 2011, US Cheese & Global Nutritionals revenue increased 35.1% to ?1.38 billion (2010: ?1.02 billion). The strong growth in revenue is attributable to strong underlying organic volume growth of 10%, higher pricing and an enhanced product mix of 14%, and the positive contribution of BSN® of 11%. Operating profit pre exceptional increased 21.3% to ?113.8 million (2010: ?93.8 million). EBITA pre exceptional increased 23.3% to ?128.8 million (2010: ?104.5 million). Operating and EBITA margins pre exceptional decreased by 100 and 90 basis points respectively. US Cheese: 2011 performance and 2012 outlookWhile the US cheese market was volatile, average prices were higher in 2010 and importantly; the business has increasingly sought to reduce this market related risk through the adoption of a range of risk management tools.Production volumes were down marginally in the year as volumes were aligned with both sales demand and milk supply. Competition for milk was a feature of the year and led to some input cost pressures. These were offset by strong operational management, including the implementation of a two year programme on lean manufacturing developed centrally, called the Glanbia Performance System 'GPS'. US Cheese implemented this programme, which will be rolled out across all key Group manufacturing sites. Export sales were strong in the year and significant investment was made in building internal resources to maximise this business opportunity over the longer-term. US Cheese continues to invest in enhancing its product capabilities and an $11m investment in a cheese innovation centre is planned for 2012. This is to facilitate closer collaboration with customers in developing new products and formats.US Cheese & Global Nutritionals Eric Bastian / Vice President / Glanbia Nutritionals Research / Twin Falls, Idaho" I lead an R&D team that is commercially focused on new products for performance nutrition, high-protein bars and beverages, fresh-dairy, and processed-food markets. We pride ourselves on being aligned with our customers and in 2011 launched several commercially-successful products."*on a constant currency basis

Directors' Report: Divisional performanceGlanbia plc Annual Report 2011US Cheese & Global Nutritionalswww.glanbia.com39Constant CurrencyReported20112010Change2011ChangeRevenue?1,380.4m?1,021.9m+ 35.1%?1,316.9m+ 28.9%EBITA ?128.8m?104.5m+ 23.3%?122.2m+ 16.9%EBITA margin 9.3%10.2%- 90 bps9.3%- 90 bpsOperating profit ?113.8m?93.8m+ 21.3%?108.0m+ 15.1%Operating margin 8.2%9.2%- 100 bps8.2%- 100 bpsEBITDA ?142.7m?116.7m+ 22.3%?135.4m+ 16.0% Results are stated pre exceptional itemsThe trading environment for US Cheese in 2012 has some challenges. Higher US milk production is expected to result in a lower average US cheese market price in 2012. While retail demand was impacted by high prices in 2011, overall demand remains resilient in the foodservice, industrial and export sectors. In response to the current competitive environment for both milk suppliers and US cheese processors, Glanbia is in the process of reviewing its milk procurement strategy for its supply base in Idaho. Overall US Cheese is forecast to deliver a performance in 2012 broadly in line with 2011.Global Nutritionals: 2011 performance and 2012 outlookGlobal Nutritionals had a strong year in 2011 and is now the largest business in the Group both by revenue and EBITA, which is a significant strategic transformation for Glanbia in recent years. Organic revenue growth was excellent in all three business units; Performance Nutrition, Customised Premix Solutions and Ingredient Technologies, driven by strong demand and good growth in prices and EBITA also improved in the year. However there were significant raw material price pressures which impacted EBITA margins in Performance Nutrition where significantly higher whey costs were not fully recovered in the market despite a series of price increases and margins declined as a result. This is reflected in the overall 90 basis points reduction in US Cheese & Global Nutritionals divisional EBITA margins for 2011.On 19 January 2011, Glanbia announced the acquisition of BSN® for a total consideration of $144 million. The business was acquired on a debt free basis and was funded through Glanbia's existing banking facilities. BSN® is a leading developer, provider and distributor of nutritional products and enhances and extends Performance Nutrition's product portfolio. During the year there has been significant investment in organisation and product development including the re-launch of BSN®'s flagship brand, N.O.-XPLODE 2.0 for pre-training performance and energy. The integration of BSN® is progressing well and the business performed in line with expectations in 2011. Market growth in all Glanbia's core nutritional sectors gathered pace in 2011 and the prospects are good for 2012.These are underpinned by long-term positive structural market growth drivers including healthy living and healthy aging. While raw material availability and cost is expected to remain challenging for Performance Nutrition in the short term, this market dynamic is expected to ease as new supply sources become available in the latter part of 2012. There is a clear focus in Global Nutritionals on developing new products, both nutritional and functional; building a systematic approach to innovation and enhancing organisation and operational capacity. During 2011, all three nutritional businesses developed their international presence and each continues to build scale and global platforms that are customer centric. Overall Global Nutritionals is expected to perform well again in 2012.US Cheese & Global Nutritionals results