Ireland-based Glanbia, the cheese and nutritional ingredients firm, reiterated its earnings guidance of 30 to 32 cents, having revised the figure down from 36 to 37 cents back in April.
Volatile dairy markets
Glanbia, which manufactures cheese for McDonalds and Burger King, said the business had been severely affected by the continued volatility of global dairy markets. One consequence is that its Food Ingredients Ireland business has now become loss-making, with detrimental effects on the overall financial performance of the group.
In advance of its first half results, published on 26 August, Glanbia said performance would be broadly in line with expectations but significantly behind figures for the first half of 2008.
And looking forward, Glanbia said it does not expect a recovery in global dairy markets until late in the year or early next year.
Mixed picture
Meanwhile, Dairy Crest also released an interim management statement that painted a mixed picture.
Sales for the three months ending 30 June were in line with those the equivalent quarter last year and sales of key brands, such as Clover, Cathedral City and Country Life Spreadable were up 8 per cent.
However, Dairy Crest said dairy ingredients markets are providing poor returns. For that reason, the company reduced the amount of milk processed by its Dairies division in the quarter. Sales in the division therefore fell 3 per cent compared to last year.
In the meantime Dairy Crest has welcomed a number of dairy farmers following the bankruptcy of Dairy Farmers of Britain (DFOB) in June. A total of 114 dairy farmers, who were previously supplying around 100 million litres of milk annually to DFOB, have joined Dairy Crest.
The company said it had also begun selling to some customers previously supplied by DFOB, including The Cooperative Group.
New chairman
As well as revealing some key financial figures and business developments, Dairy Crest also announced some changes at the top of the company.
Anthony Fry, who was appointed to the Board in July 2007, will take over from Simon Oliver as Chairman in January 2010. In the meantime, he will take the role of Deputy Chairman.