Higher profits from property are set to lift Dairy Crest’s half-year earnings above the level reported last year, the UK dairy processor said today (19 September).
In an update on its performance in the six months to 30 September, Dairy Crest said trading had been “in line with our expectations”. The company said efficiency and some success in securing price increases had “broadly” offset higher input costs.
Go deeper with GlobalData
Dairy Crest said the combined sales of its five key brands, which include Cathedral City cheese and Clover butter, was up year-on-year but said volumes would be lower than last year.
However, the company said “higher property profits” would mean “overall profits for the first half” would be “slightly ahead” of last year.
“We are pleased that we continue to perform as expected in this tough environment,” chief executive Mark Allen said. “In the first half our broad base, high quality brands and ongoing cost saving measures have allowed us to balance the conflicting demands of increased input costs and subdued consumer spending. At the same time we are investing for the future, with new products and upgraded facilities.”
Dairy Crest said it would up the price it pays farmers that supply milk to its dairies business next month. The company has lined up a price increase of 1.85p per litre from 1 October and said the payment includes “new bonuses for enhanced milk quality to further encourage the focus on milk quality and animal welfare”.
It added: “We are in the process of negotiating selling price increases to offset the impact of this.”
Shares in Dairy Crest were down 0.56% at 335.9p at 15:42 BST this afternoon.
