9th Feb 2017 07:47
LONDON (Alliance News) - Dairy Crest Group PLC on Thursday reiterated its outlook for its full year, saying it had continued to make progress in its third quarter, including seeing an improvement in its Cathedral City cheese brand.
Dairy Crest said that in its third quarter to the end of December its key brands continued to perform well. Clover, Frylight, and Country Life all grew volumes in the first nine months, and took "significant share" in their respective markets.
Cathedral City performance improved in the quarter, and overall, the combined volumes all four brands in the first nine months were in line with the previous year.
Meanwhile, in the company's functional ingredients segment, Dairy Crest said that its production of ingredients for the infant formula market continued to develop well at its factory in Davidstow.
In particular, it has seen "significant improvements" in the percentage of de-mineralised whey hitting the "important infant formula grade". This underpins Dairy Crest's confidence that it will hit its target of 80% of demineralised whey meeting that grade by the end of March.
Dairy Crest said it had seen further milk cost inflation since the half year, and has now increased its price paid to farmers by 8.28 pence per litre since June 2016.
Market prices for cream have remained high after more than doubling in the first half. As a result of these movements, Dairy Crest now expects its year end net debt to be somewhat higher.
"The business has continued to make progress during the quarter. Our brands have performed well supported by successful innovation and brand investment. I'm particularly pleased to see the improvement in Cathedral City's performance," said Chief Executive Mark Allen in a statement.
Dairy Crest will report its full year results May 18.
By Hana Stewart-Smith; [email protected]; @HanaSSAllNews
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