Ornua delivered strong performance in 2018
Ornua, Ireland’s largest exporter of dairy products, delivered a strong trading performance in 2018 with group turnover up +0.6% to €2.08 billion. Group EBITDA saw a +12.5% rise from €53.8m in 2017 to €60.5m in 2018, and Operating Profits increased to €40.4m, up 14.8% year-on-year. This performance was achieved during a period of significant and sustained investment across its facilities and brand portfolio.
Owner of the Kerrygold brand, Ornua sold the milk equivalent of 3.4bn litres across its 110 global export markets.
2018 saw accelerated growth for Kerrygold in key strategic markets. Highlights include accelerated growth in Germany where Kerrygold Butter is the fastest selling product of all food and drink brands in the German retail market; while in the US, the brand saw 25% volume growth.
Commenting on the 2018 results, John Jordan, CEO Ornua said: “We are pleased to report a strong trading performance for 2018, driving a further uplift on the record growth of 2017. This strong performance was achieved against a challenging global environment characterised by highly volatile butter prices, drought conditions in Europe, economic uncertainty due to Brexit and global trade wars.
“Kerrygold had a stand-out year and our US ingredients business delivered record growth. The strength and impressive growth of Kerrygold allowed Ornua to pay a product brand premium of €18 million to our members for Kerrygold product. Following decades of investment in the Kerrygold brand by our members and Irish farmers, our focus is on protecting this premium positioning and delivering on our strategy to extend Kerrygold from a world-class butter brand into a world-renowned dairy brand.
“Our key focus for 2019 is to drive growth for our full brand portfolio and food ingredients businesses across our 110 markets and to continue to deliver value for the 14,000 dairy farmers we represent.”
Global demand in 2019 is forecast to grow between 1.0% – 1.5% which implies that volatility is likely to be supply driven. Subdued EU milk supply in the first quarter of 2019 and solid export demand should help support commodity prices and, outside any significant changes to the trading environment, average farm-gate milk prices are likely to remain at 30-32 Euro-¢ (including VAT) per litre.
Ornua is committed to delivering value to its members and will look to capitalise on decades of investment in Kerrygold by Irish dairy farmers in the established markets of the US, Germany and the UK and to accelerate its development in key emerging markets. In 2019 Ornua will drive growth for its brands and ingredients businesses across its 110 markets to ensure it delivers strong value for Irish dairy farmers.
