Minnesota co-operative Land O’Lakes has posted fourth-quarter net earnings of US$44.5m, against a net loss in the same period last year of $1.6m. Sales were marginally lower at $1.9bn.
Full-year net earnings reached $88.7m, down from $128.9m in 2005, though the 2005 figure had been swelled by a gain from the sale of its controlling stake in CF Industries. Sales for the year fell from $7.6bn to $7.3bn.
The group’s dairy foods division recorded fourth-quarter sales of $932m, and pretax earnings of $44.8m, compared with sales of $1.1bn and earnings of $6.3m in the fourth quarter of 2005. Full-year sales from dairy fell to $3.4bn, from $3.9bn, but the profit performance from the dairy division improved dramatically, with the division posting pretax earnings of $47.2m, having only broken even in 2005.
Land O’Lakes, which is involved in seed and feed production as well as the supply of dairy products and eggs, said that among the key factors behind the strong dairy results in 2006 were brand strength, aggressive marketing, market-driven product development and an intense focus on cost control and supply chain management.
Year-to-date retail butter volumes were up by 1%, the company said, but total butter and spreads volumes were down 2%. Total cheese volumes were also up by 1%, driven by a 4% volume rise in dairy case (retail) cheese and a 2% increase in foodservice cheese.
Layers/Eggs sales for the quarter reached $112m, down from $120m for the fourth quarter of 2005. Thanks to an improvement in egg prices late in the year, fourth-quarter pretax earnings from eggs reached $1.6m, against a $4.2m pretax loss for the final quarter of 2005. Egg sales for the full year fell to $398m, from $407m in 2005, which the company attributed to the sale of its liquid eggs business in June 2006.
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