DMK reorganisation is on plan, with results stable

German dairy co-operative, DMK Group, is continuing to build the DMK of the future. The company’s realignment towards being a clear customer and consumer-based food producer, which was started in the summer of 2017, is reflected in the stable figures for the past fiscal year.

Based on the preliminary figures, total revenue in 2018 of €5.6 billion remained fairly stable to the previous year, dropping by 3.4% (2017: €5.8 billion) and earnings slightly improved, at €30.6 million (2017: €29.6 million).

Ingo Müller, CEO of the DMK Group said: “We have completely restructured a complex company with many branches in just two years. Based on this, we are now starting to restructure market development accordingly – price margin before quantity. This is an extremely ambitious plan for a company of our size, where we are fully on target in terms of implementation.”

Looking at the six business fields, DMK has completed some areas, but others are in progress:

  • Private Label and Brand focused on ‘added value’ last year and contributed to earnings accordingly.
  • Ice Cream, which was loss-making in 2017, is back on track and should be back in the black in 2019, according to DMK.
  • After a three-year construction period, the business unit of Baby Food successfully commenced activities at the new location in Strückhausen and the supplementary food brand Alete was acquired at the end of March;
  • The B2B Industry unit faced the big challenge of market volatility in the area of whey and powder in 2018.
  • The International business area focused increasingly on key regions, which will be a key activity in 2019 as well.

Müller said: “With all of these necessary, far-reaching changes and the investments that move us forward in the medium-term and the long-term – you have to have the necessary staying power. And we have just that because of our size.

“We have to continue to think more about the customer. Pure suppliers of products are interchangeable. Things are happening on the demand side of things, which is where we are able to distinguish ourselves from the competition and add more value. This is how we want to create a sustainable competitive advantage over competitors who are still really thinking purely in terms of products, which has previously been the norm for the dairy industry.

“We will continue to emotionalise ourselves and our brands and shed the sobriety of the past. It’s going to be a long journey that we’ll have to do quickly, but paths are made by walking.”

The company plans to announce detailed results and release a further outlook on corporate restructuring in connection with the representatives’ assembly, which takes place in mid-June.

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