Dairy Crest reports profits
Having sold off its liquid milk assets and refocused on cheese and powders, Dairy Crest reported adjusted profit before tax up 5% to £60.6 million (€71m). The company also reports that Cathedral City has returned to volume growth in the second half, with strong momentum expected in 2017/18, while its Frylight, Clover and Country Life spreadables all have grown in volume and increased market share. Additionally, its demineralised whey production has met targeted levels of infant formula grade. The firm’s partnerships with DuPont and others to research galacto-oligosaccharide usage in animal nutrition are working, with trials under way. The proportion of sales from recently launched products is now 13%, which is well above target, although net debt increased as expected due to the completion of the Davidstow commissioning and a final payment to Müller on sale of the dairies business. The proposed final dividend went up 2% to £0.0163 (€0.19).
Mark Allen, chief executive of Dairy Crest, notes, “Our key brands are performing well. Cathedral City remains the nation’s favourite cheese and following its brand refresh at the start of the year, the good progress and momentum we have seen in the last six months has continued in the new financial year. Our overall spreads market share has increased, and Frylight had another outstanding year with sales growing 19%. This is well ahead of the market. The ongoing investment that we are putting behind our brands gives me confidence that we can grow market share.
“We have continued to make good progress in our demineralised whey operations at Davidstow. We are now hitting our targeted level of infant formula grade. Developing our sales of demineralised whey and GOS into the high-margin global infant formula market will be a key priority this year. At the same time, we will continue our research into other potential animal and human applications for GOS.
