DFB move doubles profits

DAIRY FARMERS of Britain more than doubled its operating profit in the year to the end of March 2004, mainly due to a big rise in the amount of money retained from members‘ milk cheques to fund moves into processing.

Profit climbed 118%, or £6.6m, to reach £12.2m during the year.

£10m of that came from farmers after DFB‘s decision to retain 0.5p for every litre of milk supplied, well up on the previous year‘s average.

Sales rose 11% on the year to £436m from milk volumes, which remained stable at about 2bn litres.

That rise in sales was mainly due to 2004 being the first full year‘s trading for Dairy Farmers of Britain after it was formed in July 2002 from the merger of Zenith Milk and The Milk Group.

Milk brokering – the bulk supply of milk to processors – accounted for most of DFB‘s sales at £392m.

Sales of dairy products from subsidiary companies Nene Valley Foods and Lubborn cheese amounted to £32.3m, but lost £422,000. These have since returned to profit.

Milk sales to Westbury Dairies, the joint venture leasing agreement struck with First Milk and Milk Link in October 2003, added a further £11.7m, but cost the business £361,000.

After allowing for adjustments for interest and profits on sales of fixed assets, DFB recorded a pre-tax profit of £11.57m.

Deducting the Westbury losses left just under £11.2m from continuing operations to be distributed equally between members‘ capital and investment accounts.

Total group member funds stood at £22m at the year end.