DENMARK: Arla books profits ahead of budget
By: just-food.com | 24 February 2010
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Downturn saw Arla cut prices to farmers |
Arla Foods has booked profits ahead of budget boosted by cost cuts and rising prices for bulk industrial products.
The Danish group’s profits for 2009 totalled DKK971m (US$176.9m), DKK71m higher than the firm’s budget, exceeding the expectations of the business, Arla said yesterday (23 February).
Despite profit being ahead of expectations, Arla’s turnover was “significantly dented”, the company conceded, as customers and consumers reacted to the global recession and bought fewer and lower-priced dairy products.
As a result, Arla said it was forced to cut the milk price to its owners dramatically.
“2009 was a seriously tough year for our owners and their overall return per kilogramme of milk - DKK2.14 - is not high enough,” said Arla Foods CEO Peder Tuborgh.
“The recession was fast and deep, but didn't bring the business to a halt. We’ve shown that we can react quickly. We identified extraordinary savings that provided immediate liquidity. 2009 has also been a difficult year for employees with cutbacks and redundancies. The savings, however, were necessary and we avoided a further reduction in the milk price. That's the reaction of a strong organisation.”
Sectors: Dairy
Companies: Arla Foods
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