Carbery beefs up dairy pot and bets on diversification to ride out Brexit
Carbery Group, the West Cork based producer of Dubliner Cheese, has reported increased sales of €423.5m last year.
Turnover for the year was up 1.5pc (+2.9pc on a constant currency basis), and earnings before interest, tax, depreciation and amortisation increased 5.2pc to €43.9m.
In February, the Irish Independent reported that Carbery Group had secured EU pre-approval to receive €6m from Enterprise Ireland as part of a larger €65m investment without being found to breach state aid rules, becoming the first business to benefit from relaxation in the rules to help industry ride out the threat from Brexit.
The money will fund diversification of the business, including finding alternatives to the UK market.
Carbery plans to invest €100m over next two years, including in a new mozzarella production facility developed to cater to continental European markets and to cut reliance on the sale of cheddar to the UK.
"Brexit, of course, continues to be a concern. However, product and market diversification have always been a core part of our business and ongoing strategy. As a global organisation, we are constantly looking to international consumption trends to further grow our offering and our business. The investments I referred to earlier will ensure we are both broadening our offering and our markets," Carbery CEO Jason Hawkins said.
The Carbery Board declared a €4.3m bonus based on 2018 milk supply and took the decision to set aside this amount for its Stability Fund, for future payments at times of price volatility.
Mr Hawkins said the results reflected the strong trading performance across all three of Carbery's key business platforms of Dairy, Taste and Nutrition.
"Despite some difficult farming conditions throughout the first half of 2018, milk supply from our farmers increased by 5pc, continuing our consistent growth of milk supply. Each of our businesses performed in line with our expectations, allowing us to continue to pay a leading milk price to our shareholders, while also extending support payments for longer periods to support farmers through the severe weather conditions at the start of 2018," he said.
Supplies of milk to Carbery's processing facility in Ballineen, West Cork, rose to 536 million litres last year.
During 2018, Carbery invested a further €18m in its global operations including to increase manufacturing capacity at its facility at Wauconda, just outside Chicago, and acquiring Italian flavour company Janousek. It has also announced a doubling in size of its Asia operations flavour unit at Samut Prakan in Thailand.