Dairy co-operative First Milk shrugged off a challenging year blighted by low consumer confidence, inflation and bad weather to post continued revenue growth and a big hike in profits, its latest accounts have shown.
The supplier – which specialises in areas ranging from dairy ingredients to B2B milk supply and cheese production via partnerships with Ornua – saw operating profit jump by 229.4% to £16.8m, while turnover rose by 2.4% to £476m, according to its annual financial report for the year to 31 March 2024.
First Milk put its strong showing down to improvements in its underlying performance over the past three years, driven by efficiency gains and sales growth, which had been “masked” in the first two by the turbulence and high costs faced by the dairy sector. Farmgate prices hit record levels in 2022/23 before plummeting last spring.
Capital investment across all its sites also rose, by £1m to £8.4m, with investments in delivering operational improvements and completing a project at its Lake District Creamery to produce specialist protein ingredients in partnership with Arla Food Ingredients.
Total group capital and reserves increased to £58.5m, compared with £46.7m in the previous accounting period.
The past year also saw First Milk make a strategic acquisition, via the purchase of Dorset-based supplier Blackmore Vale Farm Cream (also known as BV Dairy), which manufactures a host of products for the food manufacturing and foodservice sectors.
This deal, which completed in February, had broadened First Milk’s customer base and product range, it said, with BV particularly strong in areas such as the gut health sector and DTC meal boxes.
A new partnership was also agreed with Yeo Valley to create the Naturally Better Dairy Group, supplying a dedicated milk pool produced by regenerative dairy farmers in southwest England.
Meanwhile, First Milk redoubled its commitment to regenerative farming practices during the course of the year, with 96% of its 700 farmer members now implementing regen ag action plans on their farms.
Action plans focus on multiple interventions designed to deliver outcomes such as improving soil health, enhancing biodiversity and sequestering carbon, First Milk said.
The number of positive interventions on member farms increased to 261,340 from 163,834 the previous year across 84,623ha of land – up 59.5% year on year.
“Despite the wider economic and geopolitical challenges, I’m pleased to say First Milk has delivered healthy performance in the last year and I’m confident we are well placed for the future,” said First Milk CEO Shelagh Hancock.
“Our focus remains on developing and creating value for our members, helping deliver resilience against the many challenges we face,” she added.
“Ultimately, our vision for the future is clear – we are working to enrich life every day to secure the future for our members, colleagues, customers and communities. We will do that by ensuring First Milk is a distinctive, regenerative farmer co-operative, efficiently producing great-tasting, quality dairy products for our customers and consumers.”
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