US-based dairy group Lifeway Foods has seen first-quarter earnings soar as a jump in sales offset rising costs.

Lifeway, the company behind probiotic dairy beverage Kefir, saw operating income climb 28% to US$1.8m during the three months to 31 March.

Lifeway announced its sales figures for the first quarter of the year last month, when it recorded a 50% jump in revenue to US$9m.

CFO Edward Smolyansky said yesterday (14 May) that the first three months of 2007 was "one of the strongest quarters we have ever had from top to bottom".

Smolyansky claimed Lifeway would be able to steer clear of problems related to the rising cost of conventional milk.

He said: "The cost trend for organic milk is flat and supply even seems to be outpacing demand, so as more and more of our revenues come from organic Kefir, which includes the recently acquired Helios brand, we hope the increased cost in conventional milk will have less of an impact going forward."