THE IRISH Dairy Board increased its sales by 6 per cent to €1.9 billion in 2010 in a year which saw its operating surplus fall to €26.9 million from €40.2 million in 2009.
Announcing its full year results, chief executive Kevin Lane described 2010 as a “transitional year for the business”, which operates in more than 80 countries.
The board noted record sales of Kerrygold-branded produce, which increased by 18 per cent in value and 7 per cent in volume.
The payout to co-operative members will amount to €11.7 million: €7.7 in redeemable loan stock and a €4 million year-end bonus.
The board said net assets were up €18.5 million to €402.9 million at the end of the year, and €19.8 million had been invested in its capital development programme.
Mr Lane said the development of the board’s strategic plan to reposition the business for the future was ongoing.
“Against the background of a weak global economy, our brands business achieved a record performance,” he said. “Overall, the business reports a satisfactory performance in 2010 with the exception of our US speciality distribution business, DPI, where margins, in common with the broader market, contracted sharply.”
He said it had been a challenging year, but in the UK the Kerrygold brand had continued to strengthen its premium position.
In Germany, the new Kerrygold Extra butter delivered sales of over €20 million in its first year, he said. BeoMilk, a fat-filled milk powder, was successfully launched in subequatorial Africa.
Mr Lane confirmed the board would be concentrating on building up new markets in Asia, the Middle East and Africa, and would work with other international organisations in joint ventures if the conditions were right.
The Irish Dairy Board, which employs 3,700 people worldwide, has developed a strategic plan to deal with the ending of milk quotas in the EU in 2015 and to implement the 50 per cent export growth in dairy output predicted in the Harvest 2020 report.
Irish banks, Mr Lane said, had not been to the fore in backing the board’s new funding structure, which it will bring in when the current facility of €250 million a year for the three years from 2009 to 2012 ends. “It would not be unfair to say they are not as receptive as the international banks in investing.”
The balance sheet showed as part of the strategic review that one-off costs incurred last year included a €2.2 million loss when it disposed of French subsidiary Loyez Woessen SA, and an €0.8 million cost when it merged its consumer food business under Adams Foods Ltd in the UK.
