© Arla Foods
Arla Foods will distribute €124 million to its farmer-owners, after a year in which it raised its milk price for the first time since October 2015.
The annual supplement amounts to €0.01 per kilogram of milk supplied by each farmer – or €9,750 per farmer on average.
In August, the dairy cooperative increased its on-account milk price by €0.0125 per kilogram – the first time it had done so since the previous October.
Arla’s total net profit for 2016 grew 20.7% to €356 million, though its group-wide revenue was down 6.8% to €9.57 billion.
As well as the payment of €124 million, an additional €103 million will be retained in the company – partly as individual retainment that each farmer-owner can take with them when their membership ends, and partly as common retainment that remains in the company as equity and for reinvesting strategically.
And a further €120 million – the result of Arla’s divestment of juice business Rynkeby – will also be held in the company for strategic reinvestments.
The value of the transaction had not previously been made available.
Arla’s not the only company to sell of its juice assets in favour of focusing on dairy, with FrieslandCampina looking to sell Riedel in Belgium and the Netherlands.
In the UK, the amount being paid to Arla’s 2,500 farmer-owners is a combined £31 million – around £12,400 on average per farmer.
Arla Foods board director and farmer-owner Jonathan Ovens said: “This payment is one of many important benefits for farmer owners like me and is particularly welcome as we begin to come out of a difficult year. It enables us to invest in our farms, and also save for the future.
“It’s an annual benefit and a return on my investment that I couldn’t achieve elsewhere. It’s good to work together with Arla to back British dairy farming. As we need to increase the country’s milk production to meet growing demand, it’s also reassuring that Arla promises to collect every drop of milk I produce at the Arla price.”
© FoodBev Media Ltd 2017