Express acts following disappointing results
EXPRESS Dairies is taking action to cut costs and boost productivity after poor full-year results.
Tough competition in the industry hit performance, producing an underlying pre-tax profit of £43m in the 12 months to March 31, 2001, a fall of 18% on the year.
Operating profit (before exceptionals) was down 6% at £58.8m on a slightly reduced turnover of £913.4m.
Express blames its reduced profits on "under-recovery" of raw milk price increases passed back to farmers and continuing volume declines in the doorstep sector. A shortage of raw milk also affected the ingredients business.
Interest costs rose almost £5m to £16m, mainly due to the Glanbia acquisition in June 1999 being included for the full 12 months.
Chairman Chris Haskins said the outlook for the coming year was tough. "We are taking initiatives to reduce our cost base this year by approximately £9m, including the closure of the Wakefield and Lurgan facilities."
He said foot-and-mouth disease had imposed extra costs on processors, but its impact on milk supply had not been serious. But the supply of milk for ingredients manufacturing remained "uncertain". *