Cavan-based co-op Lakeland Dairies has reported an operating profit of €20.5m for its 2019 financial year, which was up 17% on the previous year. Profit margins for the co-op narrowed slightly from 2.2% in 2018 to 2% last year. Lakeland’s earnings (EBITDA) grew by 28% last year to just under €43m, as earnings margins held firm at 4.1%.

Overall, Lakeland’s sales for the year grew by 28% last year to just over €1bn. The co-ops dairy ingredients division accounts for over half (56%) of all sales with turnover in the division growing strongly by 19% last year to €584m. Lakeland’s foodservice division saw a slight drop (-3%) in sales last year to €239m, while sales in its agribusiness division were down 2% to €72.3m.

LacPatrick merger

During the year, Lakeland completed a merger with neighbouring co-op LacPatrick. The acquisition of LacPatrick brought a new trading division to Lakeland in the form of branded consumer foods.

Lakeland now owns the Champion and Ballyrashane brands for liquid milk, butter, cheese and cream products. For 2019, this new consumer foods division contributed sales of just under €140m.

Lakeland now has a total milk pool on the island of Ireland of 1.85bn litres

According to the accounts, the addition of LacPatrick contributed total revenues of €232m last year between consumer foods and ingredients. The acquisition also boosted the net asset value of Lakeland to just under €200m at year-end.

Lakeland now has a total milk pool on the island of Ireland of 1.85bn litres and is supplied by more than 3,200 dairy farmers both north and south of the border.

Roughly 1.05bn litres of its milk pool comes from Northern Ireland, while the remaining 800m litres is produced by milk suppliers in Ireland. The LacPatrick takeover gives Lakeland a significant footprint in both jurisdictions with four plants located in Northern Ireland and another four plants south of the border in Cavan and Monaghan.

The co-op now employs more than 1,200 people across its eight sites and has sales to 80 markets around the world.

Full analysis and exclusive interview with Lakeland CEO Michael Hanley in this week’s Irish Farmers Journal