ROBERT WISEMAN Dairies is preparing to increase capacity and establish a new depot in the south-east, reports the Financial Times.

The group is considering expanding its plant at Manchester, which is currently running at near capacity, in a move that would see the new capacity available by 2006.

It also intends that a depot in the south-east England should be up and running by spring next year, says the paper.

The plan to expand capacity is based on continual growth in supermarket sales and the continued success of its own label milk.

“If supermarkets are going to increase their sales, we have to plan for that growth,” said Mr Wiseman.

The statement was made along with the company‘s announcement on its full-year profits.

Profits at the group rose 27% – from £22.8m to £28.9m – on sales which were up 21.4% from £391m to £474.5m.

The company‘s shares rose by 6.5p to 274p on the back of the announcement. This is the highest since flotation just over ten years ago.