Lakeland Dairies Reports Record Revenues and Profitability
Lakeland Dairies, the major Irish cross border dairy processing co-operative, has turned in an excellent business performance in 2018 with record revenues and profitability, underpinned by targeted business development activity, relative stability in global dairy markets and growth in volumes shipped.
Group revenues increased by 5.3% to €810.5 million, yielding an operating profit of €17.5 million – up from €16.8 million in 2017. This was driven by strong returns from the three main business divisions – Food Ingredients, Foodservice and Agri-trading – which were also able to capitalise on significant economies of scale, benefiting from the substantial investments of recent years in technology, automation and lean operation across our processing footprint.
Michael Hanley, group chief executive of Lakeland Dairies, comments: “Lakeland Dairies concluded the year with a strong balance sheet and shareholders’ funds of €130 million, an increase of €12.4 million for the year. EBITDA (Earnings before Interest, Taxes, Depreciation & Amortisation) of €33.65 million increased by €1.05 million in 2018 from €32.6 million in 2017, reflecting a consistently high level of operational efficiency and profitability from year to year.”
The merger of Lakeland Dairies and LacPatrick Dairies has recently received all necessary regulatory approvals. The enlarged business – to be called Lakeland Dairies Co-Operative Society Limited – will be the second largest dairy processor on the island of Ireland with a cross-border milk pool of 1.8 billion litres, produced by 3,200 farms across a catchment area including 16 counties. The new co-op will have a combined annual turnover in excess of €1 billion, creating internationally competitive scale and the opportunity for greater efficiency to be achieved across the amalgamated organisation.
Michael Hanley continues: “Market conditions for 2019 will be contingent on factors including the still uncertain impacts of Brexit and the overall balance of global supply and demand across our product portfolio. We will meet any potential headwinds by continuing to ensure complete efficiency and flexibility across all of our operations, while at all times paying the highest possible milk price in line with market conditions. We will always support milk producers to the maximum possible extent. This will continue to be our commitment in the months and years ahead.”
