Glanbia shares have been substantially re-rated and full-year profits and earnings forecasts increased after the group produced first-half results showing its strong recovery is continuing.

Glanbia is recovering from a dire period, but pre-tax profits almost trebled in the first half to €32.2 million (£25.36 million) even though turnover in the period was almost static on €1.29 billion.

Analysts believe that with the recovery momentum continuing, the group is likely to generate full-year profits in the order of €63 million and earnings per share of more than 14 cents against current forecasts of €56 million in profits and less than 13 cents in earnings.

After falling as low as 42 cents earlier this year, Glanbia shares have recovered strongly in the past three months, yesterday closing up three cents on €1.28.

That recovery, however, should be seen in the context of the shares' €4.53 high achieved immediately following the Avonmore-Waterford merger which created Glanbia.

But Glanbia's first-half figures pleased the market, and further improvement is in prospect next year when the group will not have any deferred acquisitions payments (€24 million in the first half of this year) and milk price guarantees to milk suppliers (€12 million in the current year).

Most of Glanbia's operations - in ingredients and consumer foods - performed well, but chief executive Mr John Moloney said the group still had work to do on its British food service and sliced meats operations. He described the first-half results as "work in progress" and expected continued improvements in the second half of this year, and next. Even with €36 million in deferred acquisition payments and milk price guarantees, Glanbia could still cut its debt load by €47 million to €390 million, and increase its interest cover from 2.8 times to 3.5 times. Mr Moloney said the aim was to increase interest cover to four times by the end of next year.