FDBusiness.com

UK dairy co-operative First Milk has reported profit before tax of £3.2m for the six months period ended September 30th 2010, recovering from a loss of £9m in the first half of last year. Similarly, operating profit increased by £11.8m to £3.8m as improvements were achieved across the group’s various businesses, and turnover rose by £24m to £280m. Bank debt was also reduced by £32m during the period, helped by the sale of one third of First Milk’s stake in UK dairy company Robert Wiseman Dairies for £18.5m in November 2009.

“We have laid out a strategy to drive shareholder returns, grow our brands, diversify our product and market mix, lower our cost base and seek value in partnerships,” comments Bill Mustoe, chairman of First Milk. “Benchmarking these half-year numbers against the prior year shows a greatly improved performance. The results in the first six months of last year were poor, mainly as a result of paying out a milk price that was ahead of market returns, a tactic we no longer pursue.” However, First Milk still managed to deliver milk price rises to its farmer members of 2.2 pence per litre during 2010.

He continues: “Looking ahead to the next six months, we are convinced that our strategy continues to be appropriate for the tough market conditions and expect this solid turnaround to be maintained.”