Chief Executive’s Review

Nick Whelan

Chief Executive Chief Executive’s Review

I am pleased that Dale Farm is reporting a solid year for 2019/20, despite some challenges we faced within our industry. These strong financial results, which saw us achieve Group operating profit of £12.2m, Group profit before tax of £9.8m, EBITDA of £19.3m and overall Group turnover of £504.5m, are the combined result of continued investment, excellent customer partnerships, our farmers, and most importantly, a team of hard-working, dedicated people, in every part of the business.

CHALLENGES

During 2019/20, ice cream and feed markets were negatively impacted by weather – a situation beyond the control of the business that had a direct impact on sales within our business. We were also challenged by aggressive pricing from our competitors within the GB desserts market. This area continues to prove extremely competitive.

The year brought with it a great deal of uncertainty in the run up to the decision around Brexit. On behalf of our farmers and the dairy industry, I engaged with local government and Westminster regularly to stress the damage that a ‘no deal’ Brexit would have had on agrifood in Northern Ireland and encourage the best possible outcome for our sector.

We continue to work in collaboration with food industry bodies including Dairy UK, Dairy Council for Northern Ireland and NIFDA in order to maintain that momentum and garner support for dairy farmers as the situation evolves.

We will remain focused on supporting our farmer members, unlocking the potential of our people, investing in our business and innovating to ensure our operations are efficient and our products are first class.

FOCUS

Our core strategy positions us well to build upon the steady growth we have delivered in recent years.

Dale Farm’s cheddar cheese performed consistently well across brand, own label and foodservice sectors in the domestic market and worldwide. We have a world class product, of which we can all be proud. Equally, our retail liquid milk is a central driver of our success and we’re thankful for the consistently high quality of milk provided to the business by our members.

During the year, Dale Farm paid a competitive milk price, amidst the context of the headwinds we were facing. We fully recognise and appreciate, however, that the business must be stronger on milk price this year. We reiterate our commitment to farmers – that we always endeavour to pay a competitive milk price – and this will be forefront of our minds in the year ahead.

There are undoubtedly further challenges ahead. The full impact of the unprecedented COVID-19 pandemic remains to be seen, which could be long lasting.

We will remain focused on supporting our farmer members, unlocking the potential of our people, investing in our business and innovating to ensure our operations are efficient and our products are first class.

I would like to recognise the excellent work of our now retired Chairman John Dunlop, who guided the business through a decade with great success. I warmly welcome our new Chairman Fred Allen and look forward to working with him and the rest of our Board moving forward.

Finally, I want to thank all Dale Farm employees for their continued efforts and expertise in helping drive the business, as we face the year ahead with focus, resilience and ambition.

Nick Whelan

Group Chief Executive