Kerry co-op, the farmer-owned holding company with a 13.7% stake in Kerry Group plc, has paid a dividend of €2.75 per share to its farmer shareholders for 2016, which amounted to a little over €11m. The dividend payment to shareholders is a 10% increase on the €2.50 per share payment made in 2015.

The increased dividend payment is a result of the improved performance of Kerry Group plc last year, with the flavours and ingredients business recording a 7% increase in earnings to €882m as turnover remained relatively flat at €6.1bn. The improved performance saw Kerry Group increase its dividend payment by 12% to 56c per share.

As a result, Kerry co-op saw its income from its 13.7% stake in Kerry Group increase from €11.2m in 2015 to €12.5m last year.

Operating expenses

Annual operating expenses to run Kerry co-op increased to €1.4m last year, with the majority of this related to non-executive board member fees. The fees paid to 32 non-executive directors of the co-op board came to €470,900 last year, which averages almost €14,700 per board member.

Some non-executive board members received more than others, with payments ranging from €1,250 to €36,800 per year.

At the beginning of 2016, the three senior management of Kerry co-op were Stan McCarthy, Brian Durran and John O’Callaghan, all of whom receive no remuneration for their roles.

During the year, Stan McCarthy stepped down as chief executive of the co-op, while Brian Durran resigned from his position as secretary of the society in December – a position held by Durran since 1986.

At the end of 2016, the society’s 13.7% stake in Kerry Group plc was valued at more than €1.6bn based on a share price of €67.90. Based on this week’s share price in Kerry Group of €77, the co-op is valued close to €1.9bn.

Unlike many of the other dairy co-ops in Ireland, Kerry co-op no longer owns any physical milk processing or agribusiness assets. The agri-trading and milk processing assets are fully controlled by the agribusiness division of Kerry Group plc.

However, Kerry co-op maintains an option to buy certain assets of Kerry Group’s agribusiness division, which operates the animal feed mill and milk processing assets. The option to buy these assets was agreed between Kerry co-op and Kerry Group plc in 2002 and can be exercised at any time up to 2020.