DMK, the German dairy processor, said paying more to farmers for their milk hit its profits last year.

The company, formed in 2011 through the merger of German firms Nordmilch and Humana Milchindustrie, generated profits of EUR21m (US$26.6m) in 2011.

A year earlier, the combined profits of both companies was EUR23m. A DMK spokesperson told just-food (20 June) today it paid farmers more for their milk than in 2010.

However, turnover increased by EUR500m to EUR4.6bn. CFO Volkmar Taucher said he was satisfied with the results. “After a year in the market, we have proved DMK’s capabilities,” he said.

DMK, meanwhile, also announced plans to close two factories as part of a project to “optimise” its production network across Germany.