Improved profits from cheese and higher sales of brands has boosted half-year earnings at UK dairy group Dairy Crest.

The company, which brands like Cathedral City cheese and Clover butter alongside its milk supply to UK retailers, booked a 6% rise in pre-tax profits to GBP36.1m (US$58.1m) for the six months to the end of September.

Dairy Crest said “higher profits” from its cheese business “more than offset” lower earnings from its dairies division.

The company also pointed to a 5% increase in sales of its key brands – which also include Country Life butter, St Hubert Omega 3 spreads and Frijj flavoured milk.

Frijj sales dipped 1%, however, as the commissioning of new production equipment held back volumes. 

Dairy Crest’s total revenues dropped 3% to GBP776.9m. Excluding the impact of the sale of its stake in Wexford Creamery, revenues were “broadly unchanged”, the company noted.

Chief executive Mark Allen said: “Dairy Crest has enjoyed another good six months. In line with our strategy, we have continued to grow our brands, reduce our costs and control our debt. At the same time the improvements we have made to our quality, service and cost base have paid off with new contracts to supply fresh milk to major retailers.

“Our strategy has proved successful in the challenging economic environment and positions us to deliver further value going forward.  With operational efficiencies and selling price increases in certain categories limiting the impact of higher input costs, we are confident that we can continue to deliver profits in line with our expectations.”

Shares in Dairy Crest were up 0.3% at 368p at 09:44 GMT this morning.

Click here for the full statement from Dairy Crest.