OPERATING profit at the Tipperary-headquartered Arrabawn dairy co-operative plunged 50pc to €2.1m last year even as its revenue jumped 9.5pc to €185.1m, the group's annual report shows.
Chairman Patrick Meskell said the results were "satisfactory" given the current economic conditions.
Pre-tax profits rose to €6.2m from €1.9m as the group benefited from an exceptional gain of €4.6m in the period from a share disposal.
Last year marked the first full year of trading since Arrabawn acquired the Dawn Dairies business in Galway. It was bought from Kerry Group in 2010. Arrabawn subsequently made 165 of the staff there redundant at a cost of €2.1m.
Arrabawn said Dawn Dairies had been "integrated effectively" into the group and was yielding a return in improved efficiency.
Turnover at the co-op's dairy division was 13.6pc higher at €132.5m, while at its trading division revenue was virtually unchanged at €52.5m.
The trading division includes Arrabawn's agri stores and feed business.
A recent survey undertaken by the co-op shows that 75pc of milk producers who replied to it indicated they intended to boost milk production after 2015 when the EU quota scheme is abolished.
Arrabawn recently cut the price it pays for milk, while other co-ops held prices steady.
The move by Arrabawn was criticised by the Irish Creamery Milk Suppliers' Association, which claimed the co-op had been slow to raise prices in the preceding 18 months, but quick to pass on cuts.