Cost Reduction Programme on Track at Dairy Crest
Dairy Crest’s cost reduction programme is on track to deliver annual savings in line with the £20 million target set at the start of its financial year year. These savings have partially offset higher input costs including milk at the UK dairy group. Dairy Crest will continue to focus on reducing costs into the new financial year and expects to achieve a further similar level of annual savings.
Strong performances from Dairy Crest’s foods businesses are compensating for more challenging trading in its dairies division. However, despite the progress made in identifying and delivering efficiency savings, profits in the dairies business remain under pressure. Consequently, Dairy Crest is looking at a range of options to restore this business to a satisfactory level of profitability.
Dairy Crest’s strategy is to grow sales of its brands and other added value products, control costs and generate cash. Value sales of its five key brands (CathedralCity, Country Life, St Hubert Omega 3, Clover and Frijj) have increased during the financial year. Although sales volumes of these brands fell in the first half while Dairy Crest recovered higher input costs from its customers, a strong performance in the second half means that full year sales volumes will have increased compared to last year.
Dairy Crest will announce preliminary results for the year ending 31 March 2012 on 24 May 2012.
