Valio to Raise the Price Paid to Milk Producers at the Beginning of April

The sound level of milk profit was impacted primarily by the positive development of brand product sales abroad. And world market ingredients prices are rising.

2/14/2011 --- The Board of Directors of Valio Ltd determined on 10th February 2011 to increase the price paid for raw milk to milk producers through Valio Group co-operatives by 2.5 cents per litre as of the beginning of April 2011. The new basic price paid by Valio to the co-operatives will be 41 cents per litre.

According to preliminary information on Valio's financial statements, milk profit rose from 39 cents in the previous year (2009) to 41 cents per litre. The sound level of milk profit was impacted primarily by the positive development of brand product sales abroad. And world market ingredients prices are rising.

"Valio is a company owned by some 9,000 Finnish milk producers, and whose mission is to promote the business of milk producers in Finland by manufacturing high quality products suited to Finnish tastes. The high level of Valio's milk profit by European comparison is based on its own brands, and products developed in-house, of which the latest example is Valio OLO digestion yoghurt launched in January. Valio disburses the full milk profit from its operations to Valio Group milk producers," says Valio CEO Pekka Laaksonen.

Valio turnover 2010 rose to EUR 1,823 million (2009: EUR 1,787 million). International Operations grew by 18%, while domestic turnover fell by around 5%. Loans from financial institutions totalled EUR 114 million at the end of 2010 (2009: EUR 206 million). Valio's milk margin stood at EUR 898 million (2009: EUR 863 million). According to preliminary information, Valio's book profit after taxes rose to around EUR 37 million (2009: EUR 17 million).

The biggest risk factor for the development of milk profit is related to the instability of the world economy and sudden exchange rate fluctuations that may result from it.