Dairy products group Dairy Crest Group (LON:DCG) reported strong growth in sales of its key brands and liquid milk to retailers, which together increased by £52m. The returns were offset by planned lower sales of dairy ingredients and lower sales to doorstep and middle ground milk customers. Shares in the group rose by more than 4.5% to 369.8p on the results.
The Group's revenue for the year to end-March 2010 was £1.63bn (2009: £1.648bn). Adjusted Group profit before tax was up 5% at £83.5m (2009: £79.5m). After adjusting for £4m of net exceptional profit, £0.5m other finance expense and £9.2m of acquired intangible amortisation costs, reported profit before tax was down 25% at £77.8m (2009: £103.2m). Adjusted basic earnings per share fell by 1% to 44.5p (2009: 45p). Group net debt at end-March 2010 was £337.2m, which was better than expected and £78.6m lower than at end-March 2009 when the debt was £415.8m.
Mark Allen, CEO, said: "This has been an exciting year for Dairy Crest. We have consistently delivered on our strategy of brand investment, cost reduction and cash generation, and have strengthened the business for the future. During the year, we have increased operating profits and significantly cut our borrowings, and at the same time we have continued to develop our key brands and other added value sales.
"We have confirmed our commitment to our Dairies business by announcing a major capital investment programme. In addition we have continued to innovate with further developments in our new doorstep internet proposition. We have substantially reduced our pension scheme exposure and completed the important work to set out our corporate Vision and Values.
"Dairy Crest has changed from the predominantly commodity focused, UK based business that it was fifteen years ago to an added value dairy food company with a significant profit stream from continental Europe. We have shown that we can grow added value sales both organically and through acquisitions and we are well placed to continue this."
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