Friday, May 24, 2024

Ornua profit declines following ‘challenging market conditions’

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In the company’s annual results published today, the owner of the Kerrygold brand said turnover had dipped by 0.7pc from 2022.

Operating profit at the group was also down 8.2pc last year to €116.8m. Group Ebitda (earnings before interest, taxes, depreciation, and amortisation) also fell 4.6pc to €157m.

Ornua attributed the decline in operating profit and Ebitda last year to “the challenging market conditions that the Irish dairy industry faced in 2023.”

The co-operative purchased €1.6bn in Irish dairy products from its members last year, which include 14,000 Irish dairy farming families.

It paid members a total “value payment” of €74.5m, which is made up of monthly and year-end bonuses.

A total of 26 new Kerrygold products and product extensions launched in key markets, while the group officially opened its €40m Kerrygold Park in Mitchelstown, Co. Cork.

As a result, the product capacity at the facility has risen to around one million retail packs per day.

Overall global demand for dairy products rose by around 0.5pc in 2023, the company reported. Global milk supply was up by just 0.1pc across the year.

It looks to remain flat for the remainder of 2024, the co-operative said.

Ornua now expects to deliver growth this year despite ongoing “challenging” global market conditions.

“Looking ahead, while there is continued uncertainty around the impact of macroeconomic factors on already challenging global market conditions, we remain optimistic about the future and focused on achieving sustainable growth in key markets,” interim chief executive Donal Buggy said.

Ornua appointed Conor Galvin as chief executive in February. He will take up the role next month.

Mr Galvin is the current chief executive of Dairygold Co-Operative Society, a position he has held since January 2022.

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