Donegal Creameries records 4.9% rise in first-half sales

FIGURES from Donegal Creameries show good first-half returns, with sales up 4.9% for the period.

A turnover of €60 million was recorded and the group is forecasting a solid outturn for the year as a whole.

Pre-tax profits rose sharply to over €4m from €1.5m, boosted by better returns in its operations.

The figures were helped by a doubling of its take from associate companies to €2.2m over the six months to 30 June, 2010.

“We have returned to a more normal level of performance,” the group said in its statement.

“We have had a satisfactory performance in our dairy division and the produce division is well positioned to deliver a solid performance for the year,” Geoffrey Vance, group chairman, said in his comments published with the interim figures.

“The difficult trading circumstances encountered by the agri-inputs division in 2009 have been resolved and we are pleased to report the business is back on track.

“Our associates, particularly Monaghan Mushrooms, continue to perform strongly,” he added.

The group’s balance sheet remains resilient, with total assets of €111.7m and net asset value per share of €6.07. Net debt has decreased by 9.3% to €20.1m.

Basic earnings per share for the period ended 30 June 2010 were 35.7 cent, increasing from 6.8c.

An interim dividend of 7c per share will be paid on December 3.

The group said significant growth was achieved on sales of new added-value dairy products. Organic milk is now being produced on the group’s Grianán Estate, which is being developed to produce a range of organic foods.

Recovery in raw material prices has seen a significant turnaround in agri-inputs, which performed well.

Turnover in the key divisions was up. In the case of dairy sales it rose almost 22% to €28.2m, while agri- trading sales rose 4.7% to €21.9m.

Its associate, Monaghan Middlebrook Mushrooms, continued to perform strongly and has successfully integrated the Canadian mushroom business acquired in 2009, the statement said.

Adjusted earnings per share have increased by 150% to 34.9c in the period and remain on target to be at least in the range of 65-70c for the full year.