July 24, 2007

 

UK's Dairy Crest confident of achieving profit goals

 

 

Thanks to strong sales of its brands, cost cutting in operations and price increases, British milk and cheese maker Dairy Crest is optimistic that it will meet its profit expectations this year.

 

Simon Oliver, Dairy Crest chairman said in a statement the company has performed strongly in the first three months of the current financial year and expectations for the full year ending March 31, 2008 remain unchanged.

 

The dairy firm has worked hard in recent months after rising production costs and a product recall in May created problems for the company.

 

Dairy Crest Brands that are currently selling well include Cathedral City, St Hubert Omega 3, Petits Filous, Country Life Spreadable and Utterly Butterly, Oliver said.

 

Oliver said profits further got a boost by tapping into the current trend for "healthy" products such as the "lite" version of Cathedral City cheese where its initial sales were particularly encouraging.

 

Reconstruction operations that have taken place this year include the introduction of a delivery service in the Surbiton, Surrey, and the closure of a factory in Totnes, Devon.

 

Oliver said that he hoped the improvements would allow the company to rebuild stock levels and then re-start promotional activity later in the year.

 

Dairy crest also increased the price of raw milk by 0.4 pence per litre in July, and it will go up again by 0.6 pence per litre at the beginning of August, according to the company statement.

 

The firm experienced a dip in profits in May after a recall of its Clover butter spread due to the discovery of mould in a batch of the tubs.

 

The recall cost Dairy Crest around 1 million GBP after insurance, as the company offered refunds to all customers who had bought the product.

 

In May, the company posted results for the financial year ending 31 March of 12 percent, stating that sales from continuing operations amounted to 1.309 million GBP, of which 77.3 million GBP was profit.

 

The group profit for the year was 60.2 million GBP, the company said.

 

US$1 = 0.4846 British pounds (GBP) As of July 24, 2007