An exceptional gain of ?24.2 million from the disposal of shares in IAWS helped lift pre-tax profits at Lakeland Dairies to ?28.2 million last year from ?3.97 million a year earlier.

The dairy co-operative held IAWS shares both directly and following a roll-out of the shares from the IAWS co-operative in which it holds an 8.4 per cent stake, but it sold its entire shareholding this time last year.

"We wanted to increase our cash reserves to fund suitable acquisition opportunities and, when faced with suitable potential acquisitions and reasonable market returns for these shares, it was decided that the timing was correct to realise their value together with the disposal of other non-core assets," chief executive Mr Ed Prendergast said.

The company also sold a number of properties.

The funds were used to help finance the ?55 million spent on acquiring the former Golden Vale business in Bailieboro from Kerry Group and Nestle's dairy business in Omagh last year.

Both acquisitions performed ahead of expectations last year, Mr Prendergast said, contributing ?138 million to the society's turnover of ?337 million.

Operating profits before exceptional rationalisation costs of ?934,000 rose to ?6.86 million from ?2.5 million a year earlier. Mr Prendergast said the rise in operating profit was achieved "in the face of a domestic economic downturn and increasing production costs coupled with falling world prices for dairy and other food products".

The company, which made an operating profit of ?294,000 from its joint venture with BL Ingredients in the US, remains on the lookout for further acquisition opportunities. Lakeland is interested in businesses in the added-value dairy area. It is focusing on two areas in particular, food ingredients and food services. It is already the largest UHT processor in Britain and Ireland.