Sales and Profits Increase at Milk Link
UK dairy co-operative Milk Link has produced a solid financial and trading performance over the last year. Group turnover increased by 7.1% to £628 million and EBITDA rose 15.4% to £33.7 million for the year ended 31st March 2012.
Milk Link lifted comparable profit before tax up by 42.7% to £14.3 million and the Member milk price increased by 2.5ppl during the year bringing the standard litre price to 28.5ppl. This meant that in comparison to the previous year Milk Link generated and paid out an additional £33.7 million to its Members for their milk.
Group borrowings rose by £2.1 million to £82 million. However, at the same time capital expenditure increased to £10.0 million compared to £5.5 million in the prior year.
“Despite an extremely difficult trading environment the group’s financial performance again strengthened,” says Neil Kennedy, chief executive of Milk Link. “During the year we benefited from strong commodity prices for our skimmed milk powder, cream, curd and whey products; from an increase in milk production from our Members and long term ‘direct’ suppliers; from cost savings resulting from the implementation of rigorous efficiency and productivity programmes across all areas of the business and from our continuing emphasis on cash, stock and debt management. Nevertheless, the results also reflect that Milk Link’s trading performance in our main retail and foodservice markets held up well despite highly challenging conditions. Indeed, sales both in terms of value and volume increased year on year in relation to our core Cheddar business, speciality cheese and flavoured milks.”
Milk Link has also been strengthening its processing business for the longer term by undertaking its largest capital investment programme to date. During the year, Milk Link completed two major investment programmes. The first was, as a result of a £12.5 million joint venture with Volac, the development of a state-of-the- art whey processing plant at Milk Link’s Taw Valley Creamery in Devon. A new £4 million production facility at the Trevarrian Creamery in North Cornwall was also completed by year end and to budget which has substantially increased the capacity of the creamery to meet a growing demand from major retailers and foodservice providers for its premium soft cheeses.
