Dairy giant Arla Foods saw its earnings double in the first half of the year as deals including its merger with Milk Link helped boost profits.
The Lurpack spreads producer said it achieved “significant” earnings growth in the six months to the end of June. Earnings rose to DKK1.05bn (US$1.39bn) compared to KK513m last year.
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Arla said margins were in line with the group’s target that profit is equivalent to 3% of revenue, which was up 19.4% to DKK35.7bn.
Sales were driven by organic growth in Arla’s core and growth markets in addition to the effect of last year’s mergers and acquisitions, for example, in the UK and Germany.
In 2012, Arla made a number of mergers and acquisitions, including the combination of its UK business with local co-op Milk Link.
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“Arla has delivered a strong performance in a global market which, generally, has been characterised by higher prices due to milk production being unable to match the growth in demand. We have strictly adhered to our corporate strategy both inside and outside Europe, and in the first half of 2013 this has enabled us to increase the milk price paid to our owners three times, which has increased earnings for farmers,” said CEO Peder Tuborgh.
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By GlobalDataArla said expects to report full-year revenue of DKK73bn and profit of DKK2.2bn.
Click here to view the full earnings release.
