Scottish milk processor Graham’s The Family Dairy made a pre-tax profit of £2.2m in the year to March 2019, with turnover growing by nearly 5%.
The dairy, which has 110 farmer suppliers, saw growth in year-on-year sales, helped by a strong emphasis on new product development.
As a result, it made a profit before tax and exceptional items of £2.2m in 2019, compared to £0.4m in 2018.
The 2018 figure was down significantly on 2017 levels, due to an exceptional cost incurred because of a long-running planning permission application.
Turnover also increased by £4.9m in 2019, rising to £109m.
Milk market warnings
The positive results for Graham’s come in the wake of a series of warnings about the health of the liquid milk processing sector, which is suffering from oversupply and wafer-thin margins.
A spokesperson for the business acknowledged that it was a “challenging market” and that margins were very tight, which was one of the reasons it had made capital investments of £5.6m, as it focused on new product development and business innovation.
Sales of Skyr, a Scandinavian-style cultured dairy product high in protein, have exceeded all expectations and it is now being sold in Ireland, France and the United Arab Emirates.
Graham’s is also seeing unprecedented interest in its low calorie ice-cream range.
Robert Graham, managing director, said: “New product development is a key priority for us to enable us to meet developing consumer trends for great-tasting, naturally functional dairy products made with fresh Scottish milk.”
The Graham’s dairy range includes milk, butter, cream, ice cream, sour cream, cottage cheese, quark, Protein 22, Skyr and cheddar cheese.