Dairy groups swap customers on the way to strong financial results
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Two of Britain's giant dairy groups reported today (31 March) that they were on course to meet the sales and profits expectations of their shareholders against the background of the swings and roundabouts world of supermarket supply.
In trading updates, Dairy Crest said it had sold more milk to the major supermarkets this year, winning an important Tesco contract but losing its Co-op business, while Robert Wiseman Dairies announced it had also supplied additional volumes to Tesco as well as securing a significant increase in the volume supplied to The Co-op.
Dairy Crest said a strong performance from its cheese business would compensate for more challenging trading in the spreads and dairies businesses. The dairy's cost reduction programme had delivered annual savings ahead of its £20 million target.
Chief executive Mark Allen said Dairy Crest was well positioned with strong brands, tight cost control and an efficient supply chain.
Robert Wiseman also said it was focused on reducing costs and was closing its Okehampton dairy in Devon and a distribution depot in Cupar, Fife.
On its Co-op contract win, Robert Wiseman said the dairy would be supplying own-brand milk to around 4,000 Co-operative food stores from August. Increased volumes of overall milk production would utilise a significant proportion of the additional capacity available to the Group following the commissioning of the final phase at its Bridgwater dairy where completion in November 2010 increased capacity at the dairy to 500 million litres a year, resulting in operational improvements and a reduction in overtime at other dairies.
