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Arla, the Danish farmer-owned co-op, saw sales grow by 8% for its 2017 financial year of €10.3bn. The dairy co-op said this was the single biggest increase in organic sales growth achieved in the history of the company, excluding acquisitions.
The strong growth in sales was driven by higher sales prices thanks to improved dairy markets and a 10% increase in sales of branded dairy products. Branded sales now account for just under half (45%) of all sales in Arla’s business.
Arla said international markets performed strongly in 2017, with sales increasing over 13% year on year, while sales coming from its dairy ingredients increased just under 20% in 2017.
Profits (EBIT) for the year fell by 24% to €385m.
This was due to an exceptional payout received last year following the one-off sale of a business. Arla reported net profits of €299m for the year, which represents 2.8% of revenue. This is within its annual target range for net profits.
Arla said it increased farmgate milk prices by more than 27% in 2017 to an average payout of just over 0.38c/kg.
For 2018, Arla says it is forecasting revenues to be in the region of €10bn to €10.5bn as a result of higher milk volumes and an improving product mix, which are likely to be largely offset by expected negative currency developments.
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