Dairy Crest interim results gave investor’s little to cheer. While revenues for the half year to 30 September 2008 did increase by 6% to £808 million, profit before tax slipped 7% to £28.4 million and earnings per share slumped 77% to 4.7 pence.
Half year net debt rose 7% to £490 million, and the Company reported that its pension has moved from a £31.6 million surplus in the first half of 2007 to a deficit of £32.4 million.
Dairy Crest opted to maintain its dividend payment at 7.1 pence, which helped soften the blow, though shares in the diary group still plunged 23% by mid afternoon.
Dairy Crest described its first half performance as “robust”, with increased market share for dairy spreads and “double digit” growth for its Cathedral City and Country Life brands. However, the company admitted that higher input costs had taken its toll.
Looking ahead, Dairy Crest said it expected the “economic environment is becoming increasingly tough and more difficult to predict”. Overall, it expects to report full year pre-tax profit around 10% below last year.
Mark Allen, Chief Executive said he was pleased with the group’s performance despite the challenging conditions: "We are pleased to have delivered a robust performance in the first half despite the challenging external conditions. This has been driven by the continuing growth of our leading brands, achievement of price increases and a focus on cost reduction.”