The UK’s Dairy Crest has said that during the first half of the year the group has continued to make progress with its brand portfolio, benefiting from increased marketing investment, and has made strategic acquisitions to strengthen its dairies division.

The company said its profit expectations for the full year remain unchanged. Dairy Crest said in previous announcements that last year’s changes in the fresh milk sector would adversely impact the performance of its dairies division in the current financial year.

“Therefore, as expected, group profits for the six months ending 30 September 2005 will be significantly lower than in the first half of last year,” the company said.

Performance in the second half is expected to benefit from a firmer market for cheese, continued brand progress, recent business wins and the strategic dairy acquisitions made in the first half, although trading conditions remain competitive with oil related costs continuing to increase.

The company’s key spreads brands, Clover, Utterly Butterly, Country Life and St Ivel Gold, are expected to maintain market share for the half year. Cheese brand Cathedral City delivered a strong performance and gained market share. During the half the company successfully implemented new own label cheese supply arrangements with both Asda and Morrisons, which have significantly increased volumes with both retailers.

Dairy Crest said Yoplait Dairy Crest’s performance has been strong, resulting from good brand growth and the closure of the own-label operations in June. Yoplait Dairy Crest continues to invest in new product development and has recently launched Petits Filous Plus, a probiotic drinking yogurt for children.