Canadian dairy giant Saputo saw earnings climb in its first quarter but warned of a “challenging” year ahead.
Net earnings in the three months to the end of June totalled C$136.7m (US$131.7m), an increase of 12.2% on the prior year. EBITDA was up 19.3% to C$242.1m.
Saputo said the addition of US dairy business Morningstar, which it acquired from Dean Foods in January, added to EBITDA in the period as well as boosting sales, which were up 28% to C$2.17bn.
A higher average block market per pound of cheese in the US and higher selling prices for milk in Canada also helped sales.
Saput said the remainder of the current financial year will be “challenging”, particularly in its international business, which is expected to continue to face increasing milk costs. However, the company said its goal remains to “continue to improve overall efficiencies and pursue growth internally and through acquisitions”.