Ornua Confident in Dairy Growth Following a Strong 2014
22 Apr 2015 --- Ireland’s largest exporter of Irish dairy products, Ornua Co-operative Limited, has published a review of its 2014 operational and financial performance. In the last full year before the abolition of EU milk quotas, Ornua delivered a very strong performance, characterised by excellent revenue growth and investment in the development of new routes to market for Irish dairy products.
2014 saw a strong performance by the Group, delivering growth both in turnover and profitability. Turnover rose by 10% to €2.34 billion, helping to drive a Group Operating Surplus of €30.3 million. This was achieved alongside considerable investment across the business including a €36 million spend in brand development and market support. In addition, purchases from members were up 41,000 tonnes on 2013, an increase of 16%. Profit before tax rose to €28.1 million, up 23% year-on-year. On the back of this outturn, a €12 million bonus was declared to members, including a cash bonus of €7.5 million, up 15% on 2013.
Ornua owns the iconic Kerrygold brand which is synonymous the world over for quality butter, cheese and milk powders, selling hundreds millions of packets of butter each year. Currently supplying dairy branded products and ingredients into over 110 markets around the world, Ornua’s mission is to open and develop valuable global markets for dairy products and in doing so, deliver strong returns to the farmers it represents.
Commenting, Kevin Lane, Ornua CEO said: “In addition to an excellent financial performance, 2014 was a year in which we significantly increased the capacity of our business through brand growth, innovation and in-market investment. We enter into this new era for Irish dairying in an excellent position, with a strongly performing organisation, geared for growth.”
Over the past number of years Ornua has been developing a global commercial infrastructure to take advantage of the post EU milk quota era. The last year saw a continuation of the already substantial investment which has been made in recent years in growing brands, new product development, in-market expansion, acquisitions, operational efficiency and people development. A culmination of this work was marked with the unveiling of a new global corporate identity. On 31 March 2015, the eve of quota removal, the Irish Dairy Board became Ornua – The Home of Irish Dairy, marking the latest step in its exciting journey of growth.
Key operational highlights from 2014 include:
• Increased in-market presence with 35 new people placed in-market in the past 18 months
• Significant in-market investments in Africa, Germany, Spain, the US and the UK including:
• Opening of a new facility at Hilbert, Wisconsin marked the completion of a $80 million expansion programme in Ornua Ingredients North America
• Acquisition of assets and business of FoodTec, a UK specialist ingredients business
• Acquisition of a Spanish cheese business
• €14 million investment in packing and New Product Development facilities in Neukirchen-Vluyn, to meet the increased demand for Kerrygold products in Germany
• Completion of a long-term, strategic cheese supply partnership between Ornua’s UK subsidiary, Adams Foods Limited, and First Milk, the UK dairy co-operative
• Approval for the construction of a €36 million Centre of Excellence for Kerrygold Production & Butter Packing in Co. Cork. This new development will ensure a world-class supply chain to support the growth and development of the iconic Kerrygold brand.
Ornua is confident, recognising the challenging market conditions that exist, that in 2015 our business will continue its excellent record of growth. All of Ornua’s investments are being made with a view to ensuring that high quality Irish dairy products are in the right international markets. This enables the business to continue to deliver a strong, sustainable return to the Irish dairy farmers we represent.
