Annual Results 2014
Lakeland Dairies reports increase in Revenues and Profits
Announcement of Annual Report and Results for the period to 28th December, 2014.
Lakeland Dairies has reported a 15% increase in revenues to € 625.8 million for 2014, yielding an operating profit of € 12.9 million, up by 10% on the previous year.
- Group annual revenues of €625.8m
- Operating profit increased by 10% to €12.9m
- Profit before tax increased by 5% to €10.9m
- Food Ingredients Division revenues increased by 22% to €377.9m
- Foodservice Division revenues increased by 12% to €190.3m
- Agribusiness revenues were €57.5m for the year.
- Lakeland Dairies closed its financial year with Shareholders’ Funds of €90.5m and an overall strong balance sheet.
Group Chief Executive Michael Hanley said, “These are very robust results, set against difficult market conditions in 2014, where Lakeland Dairies also paid a competitive milk price. We experienced consistently strong demand across our portfolio of dairy ingredients and dairy foodservice products. This was achieved through organic growth and new business development activity in key markets including EMEA and Asia.
“Consumer sentiment has improved gradually in key markets. This benefited our foodservice customers and fed into stronger sales across the hospitality, catering and convenience market segments. There is a growing requirement for high quality milk powders and functional ingredients in nutritional, pharmaceutical and beverage markets, where we serve leading food manufacturers and infant formula customers worldwide.
“In 2014 we announced a planned €36m investment in ‘Bailieboro Dryer Number 3’, construction of which has now started in the current year for completion in 2016. Lakeland Dairies currently produces 90,000 tonnes of milk powders a year and this will rise to 130,000 tonnes on completion of the new Bailieboro Dryer Number 3. The same site also produces 24,000 tonnes of butter and butter products. This major dual factory presence on a single site provides total flexibility in our milk throughput, for maximum value added returns, and it contributes to overall economies of scale for our food ingredients business.
“During the year, we completed a new €10m global logistics centre at our major foodservice processing centre in Newtownards, Co. Down. This is a highly automated facility with over 14,000 individual pallet spaces and robotic systems to manage, assemble and prepare consignments for export. It will ensure our capacity to meet global customer requirements with the maximum flexibility.
“Our ice cream and UHT dairy manufacturing facilities at Killeshandra have also been upgraded. Our new ‘milk stick’ dairy product was developed for the global dairy foodservice industry including airlines, convenience outlets and cafés. It has received an immensely positive reaction from our customers.
“Worldwide usage of dairy ingredients and foodservice dairy products is driven by global trends including wellness, convenience, safety and sustainability. This is advantageous to Lakeland Dairies where we are specialists in key areas including protein technology, aseptic manufacturing processes, emulsion technology and spray drying technology. We see a consistently growing opportunity in areas including infant formula, dairy proteins and health related nutritional products including lactose and whey, among other categories.
“Lakeland Dairies has created a processing, marketing and worldwide distribution capability designed to enhance the future long term sustainability and profitability of our business. We currently process over 800m litres of milk annually. This will rise to over 1 billion litres annually by 2020 and that capacity will be underpinned by enhanced innovation, new product developments and intensive business development activity.”
Lakeland Dairies’ Chairman, Alo Duffy said, “Our mainly pasture based production system gives us many advantages in serving world markets. It also helps the positioning of our products where they originate from milk produced on high quality farms in a natural and green environment. Ultimately, it’s the global food companies and consumers worldwide who are influenced by these factors and if we can continue to supply the products that they want to buy from us then our expansion will continue to be successful.”