Troubled British dairy co-operative First Milk has announced pre-tax losses of £24.9m for the financial year ending March 2015, nearly £3m more than an estimated figure published in June.

Turnover at the farmer-owned co-op fell from £610.5m in 2014 to £442.5m, with outgoing chair Sir Jim Paice noting that the decline in the dairy market affected all areas of the business. He also said that prices paid to the 1,200 suppliers were not aligned with the returns being generated by the business over the course of the last financial year.

Other issues reported include an increase in milk supply from members, loss of a major customer contract in March 2014 at short notice, and reduced market value and quality issues with cheese sales.

“The level of losses incurred was not acceptable and the board has taken steps to ensure that they do not recur,” Plaice said.

Measures implemented by the board include deferring payments to suppliers, an increase in capital investment targets for members from 5p/litre to 7p/litre and the introduction of an A and B milk-pricing mechanism.

Significant doubts remain as to whether the business can continue as a going concern beyond the next 12 months.