Trading in the first quarter of the year has continued in line with the anticipated trends set out in Dairy Crest’s preliminary results released 19 May 2009.
Performance in its Dairies division in the three months to 30 June 2009 has improved from that reported in the equivalent three months last year. This compensates for the unwinding of stock profits in its cheese business and confirms the benefits of being a broadly based dairy business.
Anthony Fry, who was appointed to the board in July 2007, will take the role of deputy chairman. He will take over from Simon Oliver as Chairman on 1 January 2010 when Simon will retire from the board. Simon will take on the position of honorary group president.
On 1 August 2009, Andrew Carr-Locke will be appointed to the board as non-executive director and chairman of the audit committee. In this role, he succeeds David Richardson, whose intention to step down from the board was announced on 15 april 2009, and who will leave the board on 1 August 2009.
Sales in the company’s Foods division for the quarter ended 30 June 2009 were in line with those for the quarter ended 30 June 2008, excluding share of joint ventures.
Sales of its key brands – Clover, Country Life Spreadable, Cathedral City and St Hubert Omega 3 – were up in total by 14% in volume and 8% in value terms. The markets for all these brands remain competitive.
Dairy Crest continues to seek manufacturing improvements and drive efficiencies in its business. As part of this, the company reports that its Nuneaton cheese packing facility is now operational.
Dairy Crest planned to reduce the amount of milk processed by the Dairies division in the quarter because of poor returns from dairy ingredients markets. As a result, sales in the Dairies division for the quarter ended 30 June 2009 were down 3% compared to those for the quarter ended 30 June 2008.
Milk volumes to its key retail customers were up 4%, but have been offset by lower ingredients and middle ground volumes and prices. The raw milk purchase prices that are paid to direct suppliers on Liquid contracts have fallen by 0.75ppl during the quarter to offset these lower returns.
In June 2009, Dairy Farmers of Britain went into receivership. Dairy Crest welcomed 114 dairy farmers to the company who were previously supplying around 100 million litres of milk annually to DFB.
On 1 July 2009, Dairy Crest purchased the remaining 50% of Fayrefield Foodtec Limited for £2.5m (net £1.7m after deducting cash balances taken on), having purchased the first 50% holding in December 2007 for £2.1m.
Source: Dairy Crest Group plc
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