Lake District cheese success boosts First Milk profits
Last updated at 15:37, Friday, 22 July 2011
First Milk has announced a massive profits boost in the last financial year and a fall in its debts thanks to the success of its Aspatria-made Lake District cheese and cost cutting at a processing site in the south west.
A rise in commodity and milk prices in the UK and across the globe also helped the farmers’ co-operative increase its pre-tax profits from £360,000 in the year to March 31 2010 to £7.2 million in the last financial year.
The company is supplied by 250 farmers in Cumbria and over the last three years has turned the Lake District cheese brand into a £50m annual retail asset and the third best-selling cheddar in Britain.
A contract to supply Nestle in Dubai and the Philippines with skimmed milk powder and an increased milk supply into the firm’s Dalston factory, has further boosted First Milk’s fortunes.
It is in talks with Nestle to secure a sustainable future milk supply in the face of many farmers quitting the industry.
A decision to invite Arla to share the Westbury factory with Milk Link and First Milk has meant they have to pay a smaller share of the £8m annual running costs.
Farmers supplying First Milk saw their standard litre price rise by 3.35 pence per litre for those in the liquid supply chain and 3.15ppl for supplying the cheese pool. The standard litre price is 26.5ppl for cheese and 26.4ppl for liquid.
Members of the co-operative will get a six per cent return on their invested capital this year.
Group turnover was £573m, up from £536m in 2010 while net bank debt fell to £44m from £69m last year. The fall in debt was mainly as a result of stronger operating cashflow and lower stocks.
Chairman Bill Mustoe said: “The business made substantial progress in 2010/11. Financially, we are strong with improved profitability, a more competitive milk price, a sound balance sheet and lower net bank debt.
“Thanks to the efforts of our farmers, our employees and our partners, the business is moving forward on all fronts.
“This progress has opened up opportunities and presents us with a variety of paths to grow turnover and profits.”
First published at 14:11, Friday, 22 July 2011
Published by http://www.cumberlandnews.co.uk
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