‘Marginal’ drop in profits at Tipperary Co-op

TIPPERARY Co-op’s results for 2006 showed the group achieved sales of €126.1 million — an increase of just €10m on the previous year.

In what the group described as a challenging year, Tipperary reported a marginal drop in profits to €707,000.

Chairman Matthew Quinlan reported the results to shareholders attending the co-op’s annual general meeting yesterday.

The society performed very well in an extremely difficult trading environment, he said.

Weak product prices in the first six months coupled with “huge increases in energy and other costs” made trading conditions extremely difficult, he said.

Despite those set-backs the society supported the milk price, offsetting a bigger drop in prices that otherwise would have resulted from the highly-competitive market conditions.

This year the outlook for the group had improved significantly, said Mr Quinlan.

Greater buoyancy in dairy markets “will translate into significant milk price increases” and Mr Quinlan was confident the society was well positioned to avail of the recent upsurge in product prices. However the outlook was not all plain sailing, he said.

Because the buoyancy was largely driven by increases in powder market prices, sustainability for the full year was a concern, he said.

“We must continue to concentrate on cost reductions and ensure a balanced product mix, he said.

The expansion and upgrading of the Emmental cheese manufacturing facility in Tipperary town was a cause for satisfaction and he also welcomed the further expansion of the society’s cheese business in France.

Tim Dullea, general manager, said cheese production increased by 19% on the previous year and that extra sales of €10m arose from additional output from the Co-op and from increased sales of cheese in France.