Good day, and thank you for standing by. Welcome to Glanbia's third quarter 2026 interim management statement conference call. At this time, all participants are in listen-only mode. After the speaker's presentation, there will be a question-and-answer session. To ask a question during the session, you will need to press star, one, and one on your telephone.
You would then hear an automated message advising your hand is raised. To withdraw your question, please press star, one, and one again. Please be advised that today's conference is being recorded. I'd like to hand the conference over to Mr. Liam Hennigan, Group Secretary and Head of Investor Relations. Please go ahead, sir.
Thank you. Good morning, and welcome to the Glanbia Q3 2026 interim management statement call. During today's call, the directors may make forward-looking statements. These statements have been made by the directors in good faith based on the information available to them up to the time of their approval of the interim management statement.
Due to the inherent uncertainties, including both economic and business risk factors underlying such forward-looking information, actual results may differ materially from those expressed or implied by these forward-looking statements. The directors undertake no obligation to update any forward-looking statements made on today's call, whether as a result of new information, future events, or otherwise. I am now handing the call over to Hugh McGuire, CEO of Glanbia PLC.
Thank you, Liam. Good morning, everyone, and welcome to the Glanbia quarter three 2026 interim management statement call and presentation. On today's call, I will provide an overview of our performance for the first nine months of the year. I am joined by my colleague Mark Garvey, who will cover the outlook.
At the end of the presentation, we will be happy to take your questions. Overall, the group had a strong performance as we continue to execute on our strategy, supported by structural trends across our markets, with growing protein consumption and increasing focus on health and wellness. Year to date, our like-for-like revenue increased by 9.9% to $3.2 billion, with volume growth across all three segments.
In Performance Nutrition, like-for-like revenue increased by 18% year to date, as we continue to see strong consumer demand in the protein and energy categories, with Optimum Nutrition continuing to outperform the protein powder category and gain market share, with like-for-like revenue growth of 25.8%. In Health & Nutrition, we saw continued momentum in priority end-use markets, with like-for-like revenue growth of 9.8% year to date. In Dairy Nutrition, we saw volume and pricing growth across protein solutions, somewhat offset by market pricing in cheese.
I am delighted to have Wendy Chang Smith appointed as the CFO Designate ahead of succeeding Mark next year, and I look forward to a smooth transition. As a result of the strong performance across all three segments, we are today pleased to upgrade our full-year adjusted earnings per share guidance to 22%-24% constant currency growth.
This will be driven by strong top-line performance in Performance Nutrition and Health & Nutrition, and continued earnings momentum in Dairy Nutrition, supported by our group-wide transformation program. Mark will provide a detailed update on changes to segmental guidance. Performance Nutrition performed ahead of expectations during the third quarter, with year-to-date like-for-like revenue increasing by 18%, driven by a 4.3% increase in volume and a 13.7% increase in pricing.
The volume growth was driven by strong category and velocity growth, coupled with increased distribution, market share gains, innovation, some shipment timing in quarter two, and a weaker comparative in the first half of the year. Volumes declined by 4.7% in quarter three, primarily as a result of tougher comparable in the U.S. region due to new distribution gains in the prior year and margin dilution from promotion activity not repeated this year.
Optimum Nutrition performed ahead of expectations with 0.8% volume growth in quarter three, despite pricing greater than 20%. Pricing growth was driven by pricing actions taken over the last 12 months, with the most recent price increases implemented in quarter three in response to whey cost inflation. We have seen an initial softening in some high-end whey prices in the last couple of months, but remain at elevated levels in line with earlier this year.
We continue to monitor the situation closely, with our estimated whey needs substantially procured for half one 2027. The visibility and insights that we build through our integrated model and procurement program is an important input into our pricing, revenue growth management model, and margin planning.
Following our recent price increases, we've seen some elasticity concentrated in specific channels and pack sizes, but underlying consumer demand remains resilient, supported by the higher-income skew of our shopper base and ON and Isopure's brand strength. We continue to monitor elasticity and remain disciplined in our approach, balancing the need to manage the cost environment with protecting consumer value and the long-term health of our brands.
From a regional perspective, PN Americas, which represents 60% of revenue, increased year-to-date like-for-like revenue by 11.9% versus the prior year, with strong growth in Optimum Nutrition, somewhat offset by declines in other portfolio brands. PN International, which represents 40% of revenue, delivered like-for-like revenue growth of 28.3% in the year to date, with strong growth in measured consumption across priority markets and continued momentum in both protein powders and creatine.
Optimum Nutrition, which represents 79% of Performance Nutrition revenue, delivered like-for-like revenue growth of 25.8%, growing ahead of the category and gaining market share. We continue to focus on driving recruitment and conversion of new consumers, supported by innovation as we expand usage occasions.
We also continue to invest across our brands to drive market share growth, including a double-digit increase in marketing spend on Optimum Nutrition this year, and we are planning for a similar increase in investment next year. U.S. consumption increased by 22.9% in the 13 weeks to October 3rd, with strong double-digit growth across core channels, growing ahead of the category. We saw continued growth in our household penetration and distribution. We're also seeing resilient consumption across measured international markets with strong double-digit growth.
Isopure saw strong growth in online and food drug mass channels, offset by declines in the club channel, primarily reflecting reduced distribution in the club channel. We will fully lap that impact by end of year. Isopure also saw good double-digit growth in household penetration and total distribution points.
As a result of the continued strong momentum in the third quarter, which we see continuing into the fourth quarter, we are pleased to upgrade our full year like-for-like revenue guidance to 16%-17% constant currency growth. Health & Nutrition delivered a strong performance year to date, delivering like-for-like revenue growth of 9.8%. This was driven by 11.5% increase in volume and a 1.7% decrease in price. Total revenue increased by 12.8% as a result of a 3% increase from the acquisitions of Sweetmix and Scicore.
We are pleased with the continued momentum across our end-use markets of active nutrition, functional beverages, and vitamin and mineral supplements, supported by strong underlying category momentum in protein and broader health and wellness trends. As we noted previously, growth in the first half benefited from some incremental customer-led innovation activity. In quarter three, growth returned to a more normalized level.
Given the nature and timing of customer innovation programs, we can see some variability in growth from quarter to quarter, but the underlying momentum in the business remains strong. Regionally, we saw strong growth, particularly in EMEA and Asia Pacific. Pricing was slightly negative as a result of certain volume rebates to customers throughout the year and due to tariff refunds to customers in the second quarter.
The integration of our recent acquisitions of Sweetmix in Brazil and Scicore in India are on track, and our capacity expansions in the U.S., Europe, and China are progressing well, with new capacity expected by early 2027. We remain ambitious to scale this business further through acquisition. We continue to see strong demand for our high-quality protein solutions and bioactives driven by global trends in active nutrition and everyday wellness, supported by our expertise in protein innovation, positioning us as a partner of choice for customers seeking premium, science-led protein solutions.
Year to date, like-for-like revenue in Dairy Nutrition increased by 2.1%, driven by a 1.4% increase in volume and a 0.7% increase in price. The volume increase year to date was driven by protein solutions, with strong whey protein demand particularly targeting the high-protein healthy snacking category.
We continue to see good demand for colostrum, targeting gut health and immunity, as we evolve our innovation and fractionation to deliver peptides that deliver immunity and other bioactive benefits to consumers. The volume decline in quarter three was primarily driven by customer-related timing effects for some commodity-linked products. Pricing is driven by double-digit pricing in whey protein solutions, somewhat offset by declines from market pricing in cheese markets. With that, I will hand over to Mark.
Thanks, Hugh, and good morning to everyone on the call. The group has a strong balance sheet. At the end of the third quarter, net debt was $704 million. Capital expenditures, both strategic and business-sustaining initiatives for the year, are expected to be between $100 million and $110 million, with investments primarily related to capacity expansions within our Health & Nutrition segment, as well as group-wide business integrations and digital investments to drive further efficiencies in operations in February, we announced authorization for a EUR 100 million share buyback program.
This program was completed in two tranches, EUR 50 million by way of our regular share buyback program, which was executed from March through July, and EUR 50 million in June through a directed share buyback with Tirlán, our large shareholder.
In total, in 2026, the group repurchased and canceled approximately 4.9 million shares at an average price of EUR 20.49. Approximately EUR 102 million in dividends were also returned to shareholders this year, in line with our progressive dividend payout ratio of 30%-40% of adjusted earnings per share. Now let me turn to our fiscal 2026 outlook.
We are ambitious for growth, and we outlined our medium-term growth algorithm at our Capital Markets Day in November 2025. Given our position at the heart of better nutrition and the strong momentum we are seeing this year in the categories in which we operate, our expectations for 2026 are above our medium-term growth algorithm.
Following the strong performance year to date, Performance Nutrition like-for-like revenue growth is now expected to be in the range of 16%-17% for the year, which assumes some volume elasticity in Q4 following cumulative pricing actions. We expect Q4 volumes for Performance Nutrition and Optimum Nutrition to be broadly in line with Q3 volume rates, with a tougher comparable in PN International in Q4.
The Q4 year-on-year pricing contribution will moderate somewhat from Q3, as we lap Q4 pricing from last year. We continue to manage our whey needs through layered forward procurement, and at this point, we have substantially procured our estimated whey needs for the first half of 2027.
Based on procurement to date, we are seeing higher costs in the first half of 2027 over 2026, reflecting continued strong demand, and consequently, we will consider the need for additional price increases as appropriate in early 2027, following further visibility in full-year 2027 whey costs. Performance Nutrition EBITDA margins are expected to be higher in the second half this year compared to the first half as a result of executed pricing actions.
On the full year, we continue to expect some margin progression over the 13% EBITDA margin in 2025. We are continuing to offset higher whey costs with pricing, revenue growth management initiatives, and our group-wide transformation program, while also ensuring continued investment behind our brands. Health & Nutrition delivered a strong performance in the first nine months of the year, with some benefit from timing of orders from certain customers in the first half of the year.
Growth in Q3 was within our medium-term guidance range of 4%-6%, and we continue to expect fiscal 2026 like-for-like revenue growth in the range of 8%-10%, with Q4 volume growth expected to be lower than Q3 growth as a result of the phasing of some orders from customers. Underlying end market growth remains in line with our medium-term growth algorithm.
We continue to expect Health & Nutrition EBITDA margins to be in a range of 17%-19%, with increased costs in the second half resulting from supply chain disruption resulting from the conflict in the Middle East. The strong performance in Dairy Nutrition in the first nine months of the year was driven by pricing and volume growth in protein solutions, serving the high-protein ready-to-eat and healthy snacking categories.
Following this strong performance year to date, we now expect Dairy Nutrition EBITDA will be in a range of $175 million-$180 million for the full year. We expect the group share of profit after tax in the joint venture to marginally exceed $20 million for the full year. Operating cash flow conversion is expected to be at least 85% for the year, in line with our medium-term target, and net debt EBITDA is expected to be approximately one times at year-end.
Therefore, as a result of the expected improved revenue performance in Performance Nutrition and continued strength in Dairy Nutrition and our joint venture, we are pleased to upgrade our expectations for 2026 adjusted earnings per share growth to a range of 22%-24% constant currency. With that, I will hand it back to the operator, and we will be happy to take your questions.
Thank you. We will now begin the question-and-answer session. As a reminder, to ask a question now, please press star, one, and one on your telephone, and wait to be announced. To withdraw your question, please press star, one, and one again. A moment for our first question. Our first question comes from the line of Patrick Higgins from Goodbody. Please go ahead, Patrick, your line is open.
Thanks. Morning, everyone. Three questions, if that's okay. Firstly, just for Mark, first just to say congrats on the retirement announcement and all the best with the next chapter. Maybe just coming to PN pricing, a big step up there, 25% growth in Q3, materially ahead of the mid-teens we had expected, and a big step up versus the 12% in Q2. Maybe you could just bridge the step-up in terms of the annualization and the phasing of price increases versus maybe lower promotional intensity and better mix.
Second question then maybe on the ON volume resilience. Obviously still positive despite the scale of the pricing taken and the really strong prior comp. Maybe you could just unpack what's driving that resilience between underlying category growth, share, and distribution gains, and then innovation, particularly around creatine, I guess.
My final question is just around the competitive environment into Q4 and 2027 as whey costs ease. Do you expect an increase in promotion activity given the pullback in whey costs, or how do you think the industry will prioritize, I guess, rebuilding margins versus driving volumes? Thanks.
Good morning, Patrick. Thank you very much for that. I suppose the first question on Optimum Nutrition pricing, what I'd say, look, at a strategic level, it's a cumulative effect of three price increases over the last 12 months. So, that's what drove the big pricing increase in quarter three. We will lap that first price increase. That first price increase was put in early quarter four last year, so we'll lap that down quarter four this year.
I think pleasing is we've seen the business demonstrate very disciplined pricing execution. I've spoken about it before. We're very considered and deliberate around how we approach pricing actions across the last 12 months as we make sure we continue to capture share and consumer demand. I think as well, you said it yourself, good price realization in the quarter across our portfolio.
From my perspective, I suppose, the real positive is to see such strong price realization complemented by that healthy consumption growth that you see globally. Optimum Nutrition, yeah, look, I think we said it on all our calls, we'll always be prudent as we look ahead, as we price increase as well, and just carefully monitor consumer reaction.
I think what we're continuing to see, though, is continued strong category demand globally, driven by the health and wellness and protein trends that we've spoken about before. We continue to capture share. I think that's driven by our marketing investments. What will drive most of it, really, it is category growth and velocity as we take share rather than innovation. They're the two big drivers of consumption.
Creatine, yes, we called it out, continues to perform strongly, so pleased to see the performance across both our protein and creatine categories. Lastly, the competitive environment, whey. Look, I suppose what I would say on whey, fundamentally, whey price drop is good for the group. We are a far bigger buyer of high-end whey proteins than we are a manufacturer, so a reduction in whey ingredient prices overall is good. It clearly benefits our PN margin business.
It might impact DN a little negatively, but majority of our protein business in DN now is in solutions, so it means it is more insulated. What we see is, certainly from our perspective, while we have seen some pullback in pricing on one particular variant only, this is after a record spike in price in quarter three, in fact, over 80% of a price increase in those couple of quarters.
While it is now off its record highs, it is now only back to where it was earlier this year, and still substantially ahead of last year and long-term averages. So, from our perspective, we will continue to watch carefully. Whey demand remains robust. We can see that across our integrated model. So, in terms of price increases for next year, we will keep it under review. We will watch carefully as we go into early next year, but we will likely be pricing in half one next year on our protein brands.
I would just add, Patrick, thank you for your kind words. Appreciate it. As Hugh says, I mean, if you think about the upgrade we just have here in Performance Nutrition, it is the ON resilience, as you said yourself, elasticity coming in a bit better. We anticipated that the execution of the pricing realization has come in a bit better than we expected as well. So all of that, of course, has led us to be comfortable upgrading the top line for PN.
All very clear. Thank you.
Thank you. We will now move to our next question from the line of Cathal Kenny from Davy. Please go ahead, Cathal. Your line is open.
Good morning, and thanks for taking my questions. My first question, Mark, is just can you reconfirm your comments on volumes for ON for Q4, please? That is my first question. Second question, looks like the PN International was very strong. Perhaps you could isolate the performance of Optimum Nutrition International in Q3, and what were the drivers of that? I know in the prepared remarks you mentioned innovation and distribution gains, but if you could elaborate further on that would be welcome.
My final question then is on margin, and just looking at the context of a much stronger revenue performance, Performance Nutrition, but you have held your margin commentary for the full year in terms of progression. Does that infer some reinvestment in marketing spend in the back half of 2026? They are my three questions. Thank you.
Hi, Cathal. I will take the first and third, and then pass to Hugh for the second. In terms of Optimum Nutrition, yeah, just reconfirming my comments, I just wanted to give some view as to probably expect volumes to be in the fourth quarter for PN and for ON.
Yeah, we expect the Optimum Nutrition volume profile to be similar in the fourth quarter to what we saw in the third quarter, which again, we are pleased to see. It will be more Americas than International. We are lapping some distribution gains in International in the fourth quarter last year, so it will be more of an Americas, I suppose, volume profile for ON in the fourth quarter.
In terms of margins, yes, clearly pricing does help, but I think you might recall at the half year, I did say that to the extent that elasticity came in a little bit better than we expected, we would be using some higher-cost whey. That does feed in the formula as well. We continued our marketing investment. Our marketing investment this year actually will be around 6%, similar to where it was last year, rather across the top line has gone. That means there is a significant volume, a nominal increase rather, in the dollar spend there on marketing, which we are happy with as well. With that, I will pass it to you.
Morning, Cathal. How are you? Just to speak to PN International, yeah, continued trends that we would highlight in the half year, good performance across all of our kind of Tier 1 marketplaces, whether that be China, India, Europe, U.K. So good, strong performance.
Remember, International is primarily Optimum Nutrition, although we have seen very strong performance for Isopure in India also. So, continued strong consumption, double-digit consumption in a lot of those key markets, again, driven by the health and wellness trend that we've spoken about in the past. We'll see that come back a little bit in quarter four, up against tougher comps in our International business, but overall trends remain very strong.
Thank you.
Thank you. Our next question comes from the line of Ana Nogueira from Berenberg. Please ask your question. Ana, your line is open.
Good morning. Congratulations on the Q3 results, and thank you for taking my question. I have one question on Performance Nutrition volumes in Q3. Given that Optimum Nutrition volumes were positive, whilst the division overall declined, could you give some color on what drove the volume declines of other brands and how price elasticity and competitive intensity have evolved during the quarter? Thank you.
Hi, Ana. Yeah, no real change to competitive intensity. I think consumption remains very strong, driven primarily by Optimum Nutrition. The decline in other portfolio brands is, as we spoke about at half-year results, and I highlighted in the call earlier, Isopure is the big driver of it, which is a We are very happy with Isopure growth in food/drug mass channels, double-digit consumption growth. But we had club channel business last year that we no longer have, and we will comp that at the end of this year.
So we would see Isopure back in growth in the U.S., in North America market from the start of 2027. Then think!, our ready-to-eat high-protein bar, we are relaunching that. We have lost some distribution, but we have a major relaunch coming in quarter two next year. Again, the driver of the decline in the overall number is driven primarily by Isopure and think!, but that should turn in 2027.
Thank you. We will now move to our next question from the line of David Roux from Morgan Stanley. Please go ahead, David. Your line is open.
Good morning, Hugh and Mark, and well done on the results. I have three questions from my side. Firstly, on Performance Nutrition pricing. I think in the update in August, you mentioned you were looking to take an additional pricing in Q3, then either late in 2026 or early 2027. Could you update us on whether these have or are playing out as you had expected?
My last two questions relate to your comments around whey procurements. How much flexibility do you have in your overall whey procurements from your suppliers, given the spot market is rolling over, or should we consider your cost base through the first half of next year largely fixed? My last question, sort of building on from this, can you confirm if costs in 2027 are still expected to be higher than 2026?
I note that you mentioned you are pulling forward some of the higher cost whey, given the low elasticities at the minute. Also, any quantification on how much higher you think costs will be next year versus the aggregate of 2026? Thank you.
Good morning, David. Maybe just talk to the whey point first. If you ask, are we largely fixed? No, we have good flexibility in our whey procurement. We have a layered approach. Obviously, our integrated model across B2B and B2C gives us great visibility. We did see significant spikes in quarter two and quarter three on a single variant of whey that we will not have bought at the high end of that market, and we are buying right now at the lower end of the market.
So that will start to flow through next year. So we have phased in how we approach our procurement, and it would not be as fixed, maybe as you suggest. We have good flexibility around that as well. But we will see higher whey costs in early 2027 off the back of some of those prices we saw in quarter two and quarter three.
As I said, fundamentally, we continue to see those prices still remain substantially higher than they were earlier on in the year, and it is only one variant that we saw a drop on. We have not seen a drop in other variants. Demand, as we see from our B2B Dairy Nutrition business, is good. In terms of pricing, what we said is, I think in my half-year results, I said we will be reviewing pricing and may have to consider a price increase at the end of 2026 or early 2027.
What I have also said is we have been very disciplined in how we approach that pricing, so watching ahead on input cost inflation, watching ahead on consumption, competitor reaction, market, et cetera. So, we do believe we will still have to price increase in 2027, but it is more likely in half one. We will not be price increasing between now and the end of the year, but we will continue to keep that under review.
Yeah, and David, just in terms of quantifying, I mean, it's too early for me to quantify at this point. But as Hugh said, as you look at early next year, there is some higher whey than we would have for this year. But we are layering in our procurement. We've got great relationships with our suppliers. And as we look to next year, we'll update you in February in terms of how that will look.
Okay, thank you. That's very helpful. Just perhaps just a follow-up question on that. So, yeah, so it's quite clear you have a lot of flexibility on the phasing, et cetera. But when it comes to the actual contracts with your customers, if you locked into, say, a delivery in, say, April next year, do you have flexibility in renegotiating that lower, just given the size of yourselves as customers?
Yeah, I think you mean by suppliers. What I'd say to David, without getting into specifics on quarters or suppliers, is we don't believe we're at any competitive disadvantage in terms of our whey procurement. And you can well imagine that the whey we're buying now will benefit in quarter two. So, we move through whey supplies very quickly, so we're not at any competitive disadvantage.
Thanks very much.
Thank you. Our next question comes from the line of Karel Zoete from Kepler Cheuvreux. Please go ahead, Karel. Your line is open.
Yes, good morning, all. Thanks for taking my questions. I have two follow-up questions. The first one, I know it's early days, but we already mentioned 2027 a few times. Given the incremental pricing in H2 this year and further increase in 2027, how should we think about your 5%-7% medium-term growth outlook for PN in 2027?
Related to the medium-term ambitions for PN, the margin improvement of 250 basis points as shared last year at the CMD, is that still possible to achieve given the elevated level of whey prices we've seen? The second question is, please, if you can provide a bit more details with regards to what you're seeing in the U.S. with the design for value, pack size program, et cetera. Where do you see more elasticities and where less? Any help on that. Thank you.
Hi, Karel. I won't give you 2027 guidance, but I presume it's clear that as you look at the lapping of price increases you're seeing this year, that is going to continue into next year. So, probably not unexpected that we would be at least if not above our 5%-7% for next year because of the pricing lap alone, but we'll confirm all that obviously in February. From a margin perspective, we are still focused on getting that 250 basis point improvement through 2028.
I had said at the last call that obviously it is taking a little longer because of the fact that whey costs have increased quite significantly. We are seeing some stabilization now, potentially some reduction in one element. We'll see how that plays out. But our pricing has been executed, I think, very, very well for us to continue to catch up on that.
Importantly for us, this transformation program of $70 million also kicks in fully next year, and that'll obviously be a significant benefit for us in helping our margin and giving us some space also to increase investment behind our brand. So, I'd expect to see further progression next year.
Yeah, Karel, from an elasticity perspective, you specifically mentioned the U.S. I think, first and foremost, I suppose, we will always look at consumption numbers. Our consumption numbers, when you look at U.S. consumption last 13 weeks at 22.9%, are very strong for ON. The same international markets as well, very strong double-digit consumption in all of the markets that we measure. So very happy with continued demand.
I think that is the fundamental, demand remains strong. Yes, we have seen limited elasticity. We have seen some trading down from five pound to two pound, but we have also seen some trading up from 5 lbs to 10 lbs in protein. I think what I would say is it is still too early to call. Demand remains robust. Quarter four started well, but it is again something we keep under review.
Thank you.
Thank you. Our next question comes from the line of Alex Sloane from Barclays. Please go ahead, Alex, your line is open.
Yeah. Hi, morning all. Thanks for taking the questions. Firstly, I just wanted to echo sort of best wishes for Mark, and good to see working capital clearly well managed in the quarter as usual. Two questions, really. One was coming back to the whey procurement. Sorry, I know there has been a lot of questions there. But, Hugh, your comment that you do not think you are at any kind of fundamental disadvantage. Just to kind of maybe dig in on that a little bit.
So, you basically do not see a risk that in H1 of next year, if you have to take pricing up again because whey costs are higher, that competition in aggregate has much different procured whey, so at that point could be cutting prices based on the falling spot rate. Is that the right sort of understanding there?
And then, I guess secondly, just on the WPC80 pullback, which I think probably has been more extreme than most were expecting over the last couple of months. What's your read on kind of what's driven that? Is that reformulation for that specific grade, or is this kind of a signal that maybe we're sort of at the top as regards to kind of demand for protein, do you think? Do you think there's any I mean, historically, what would you expect this pullback in WPC80 to kind of feed through into WPI to the same extent over time, or do you think this time it's a bit different? Thank you.
Thanks, Alex. Yeah, I suppose the first thing maybe just starts with the overall markets and overall demand. Our integrated model across B2B and B2C gives us great early insights and reads on the dairy and whey markets. Fundamentally, what we see right down to even dry whey and retentate, which is the raw material, is very continued, very strong demand for whey protein.
I would hear that from my Dairy Nutrition business. When you think about the WPC80 pullback, and what we saw in quarter, it was a spike in price. We went up 80%-100% in the space of two quarters. What drove that? There's a degree of trading, there's a degree of emotion in this as well. Clearly, we had strong demand, but it's now off its record highs.
It's back to where it was in quarter one, which is still substantially ahead of what it was in prior years. So, whey pricing still is robust, while certainly in one variant it's come back, but it's come back off a record spike in price. What's driven that? I think probably a couple of, three probably things.
One, I think, yeah, we probably have at that variant of whey, we have seen some reformulation and some industries using cheaper variants of different proteins. But there's only so much of that you can do. I think the second thing, remember, a lot of the dairy plants have a variability. They can switch manufacturing across different variants. They can switch from 80 to 90 to dry whey.
What we will have seen is, given the high whey prices, the 80 prices particularly, manufacturers switched into 80s, they now switch back into 90, so given those prices pulled back. So, there's a lot of complexity and moving bits and pieces in this. I think your answer, the spot market, yes. Could somebody discount based on the fact that they have had no inventory and bought off spot in quarter three and into quarter four for early next year?
Potentially. But most of our competitors are of scale. They'll have inventory just like we do. It'll take time for it to flow through. What we're seeing is, in reality, this is a kind of a quarter blip. What I'll always go back to is the long-term fundamental demand on whey across our entire portfolio. The long-term fundamental demands for protein remain strong.
Got it. Thank you.
Thank you. As a reminder, before we move to our next question, please press star, one, and one now if you wish to ask a question. Our next question comes from the line of Damian McNeela from Deutsche Bank. Please go ahead, Damian, your line is open.
Thank you. Good morning, everybody. A few from me, please. Firstly, just on the strong consumption, I was wondering whether, Hugh, you could provide some insight into the extent to which that's been supported by new consumers entering the category, whether you've got any data points you can share around that, please. Second one is just on marketing.
I think you talked about strong double-digit increase in support for ON, and you're at a 6% of revenues for the group this year. Can you provide any insight into the level of marketing support for the other brands within PN? Then just one final one. You talked about the ambition to do more M&A in H&N. Can you just provide us an update on the pipeline and their potential outlook for doing more deals in the next 12 months or so, please?
Yeah, good morning, Damian. Yeah, consumption, I suppose what I'd say again, just overall, very pleased with consumption in the U.S. and globally. We continue to see new consumers coming into the market. I think the way we would track that is household penetration, and we should see strong growth in household penetration, double-digit growth in household penetration.
About half to two-thirds of that would be driven by new consumers into the category. So that's the most pleasing thing. I've called it out in terms of where we focus our brand spend as well, that that's a key focus area for us, is to make sure we drive awareness of our brand for those new consumers coming into the category, that we recruit them into our brand.
A lot of our brand investment, our quality, our heritage, our trust element, I've said it before, we're the most recommended, most reviewed brand out there in Optimum Nutrition. So that's a key focus for where we invest our money. We have double-digit increase in our marketing spend in Optimum Nutrition this year in terms of dollars. We will do the same again next year. It's our brand.
I think we were clear that it's probably called out the three brands that are our priority investment are our protein brands, Optimum Nutrition, Isopure, and ON. So they're the brands that we continue to prioritize our brand spend around, and we will continue to do that for next year. think!, obviously, until we relaunch next year, we pulled back on some of that marketing spend, but you'll see a big increase in support for our think! b rand from quarter two on next year.
Lastly, just in terms of M&A pipeline, yeah, very active. I suppose our challenge as always is, we're good financial discipline, so some of the valuations that are out there are a little bit frothy. So, making sure that we have a very active pipeline, but making sure we acquire the right asset at the right price with the right return continues to be a key focus for us. As we said at our Capital Markets Day, we are ambitious to scale Health & Nutrition more.
Great. Thank you very much.
Thank you. We have now reached the end of the question-and-answer session. I would now like to turn the conference back to Mr. Hugh McGuire for his closing comments.
Thank you very much, operator. Just to say thank you all for your questions and look forward to meeting with you over the next couple of weeks.
Thank you for your participation in today's conference. This does conclude the program. You may now disconnect your lines.