Dairygold assures shareholders assets needed to be sold
Dairygold said, in a newsletter to members, that the priority is to process its milk pool in the most efficient manner, while ensuring it drives its business further up the value chain and maintains its service to farmers.
“Given the huge challenge that Dairygold faces in today’s competitive dairy industry, it is essential that we tackle unprofitable and under-performing parts of the business, now,” said the letter.
“We must exit from any non-essential, loss-making businesses. This strategy will strengthen Dairygold and prepare it to face future marketplace challenges,” it said.
Dairygold said its beef deboning plant, at Kilbeggen, had been sold to Dungannon Meats, while the sale of the Charleville slaughtering plant, to Dawn Meats, was subject to Competition Authority approval.
“Both sales involve the full transfer of employment. The sale of both of these unprofitable beef plants to processors of larger scale best serves Dairygold and is in the best interests of farmers, as both plants will continue to be significant outlets for cattle,” the letter said.
Dairygold retains its valuable beef business in Holland, supplying Galtee-branded consumer products to Dutch retailers.
Dairygold said negotiations being undertaken in relation to the sale and lease of its five pig farms were at an advanced stage.
“Members recognise that there is no need for Dairygold, as a business, to operate on-farm pig production at producer level, when there are plenty of pig farmers who can rear pigs equally well, or better,” the letter said.
“Dairygold will, however, retain and aggressively build a successful pork food business to further strengthen our Galtee, Shaw’s and Roscrea brands,” it said.
Dairygold said that, in order to tighten its division in Britain and expand consumer food sales there, it had sold its 50% stake in the Aeron Valley cheese-manufacturing plant in Wales, subject to contract.
“We have, however, kept the adjoining packing plant. This state-of-the-art plant is one of the most efficient in Britain and Ireland and we intend to expand its operation further,” the letter said.
The newsletter said that, while many people are interested in the sale of assets or businesses, Dairygold is committed to milk processing and delivering the highest value it can from its milk pool.
“All loss-making activities will be reviewed, essential ones will be turned around or delivered in a better way, while non-essential ones will be disposed of,” it said.
“We will continue to tighten our cost base, while delivering the highest level of service to our farmers, either directly or though other appropriate means. These services will be turned around or delivered in a better way, while nonessential ones will be disposed of,” it said.
