Lakeland Dairies has announced it increased revenues and operating profit, while paying a competitive milk price to milk producers, throughout 2020 despite the challenges brought about by the Covid-19 pandemic.
The farmer owned co-op which collects 1.9bn litres of milk from 3,200 farm families across 16 counties in Northern Ireland and the Republic of Ireland made the announcement on the back of its annual report which was launched earlier today.
In 2020, Lakeland Dairies achieved “record revenues” which increased by over 5.7% to €1.09bn across its four operating divisions of Food Ingredients, Foodservice, Consumer Foods and Agribusiness - up by €59.3m on 2019.
This yielded an operating profit of €26m, up by €5.6m (+27%) and EBITDA of €50.5m, which increased by €7.6m.
The co-op closed the year with a further strengthened balance sheet including Shareholders’ Funds of €207.7m.
Food Ingredient revenues increased by 18% to €691.0m while the Foodservice Division returned revenue of €181.7m.
Consumer Foods had a buoyant year in line with an uplift in overall grocery market growth levels, with revenues of €145.9m.
Lakeland Agri increased revenues by 4.7% to €75.8m because of a strong performance with feed sales volumes of 220,000t and fertiliser sales steady at 27,000t - similar to the prior year.
Group Chief Executive Michael Hanley said the results are very positive given the global events of 2020.
“Notwithstanding the major operational, logistical and commercial constraints of the pandemic, both domestically and globally, we continued to make strong progress across all of our operations and this has yielded excellent results,” he added.
“We paid a competitive milk price throughout the year in line with market conditions.
“Aligned to our business achievements, we further consolidated the benefits of the Lakeland LacPatrick merger of 2019, achieving ongoing organisational, operational and administrative efficiencies and contributing to overall economies of scale, value creation and long-term sustainability for our 3,200 milk producers, north and south.
“This robust performance enabled us to pay a competitive milk price in spite of serious market uncertainties that existed throughout the year.”
Mr Hanley went on to say that market returns were dependent on the dynamic of milk supply and demand that exists between countries, geographies and continents and which also included seasonality and ‘force majeure’ issues such as the pandemic.
“We expect relatively stable dairy market conditions through 2021 albeit there are still significant challenges in our operating environment as we await the anticipated beneficial effect of worldwide vaccine initiatives,” he continued.
“All of our initiatives are focused on serving the long term sustainability of our farm families while working in partnership with our customers throughout the world.
“We have excellent facilities using advanced systems and technologies.
“We continue to invest in our innovation capacity, new products and new ways to market.
"We have long term, loyal and deeply valued customers and we have the scale we require to continue to compete successfully on a global basis.”