Irish dairy co-operative Lakeland Dairies has reported its financial results for 2023, calling it a “challenging year for the entire industry”.

Lakeland reported an overall group revenue of €1.6 billion in 2023, down from the 2022 revenue of €1.9 billion. This resulted in an operating profit of €14.8 million before exceptionals, reduced from €32.5 million in the prior year. Lakeland said this was “in line with the significant market volatility experienced throughout 2023”.

Earnings before interest, tax, depreciation and amortisation (EBITDA) came to €43.4 million compared to €60.2 million in 2022. Lakeland called this “robust in the circumstances”.

Food ingredients

In the Food Ingredients division within the company, revenues of €955 million were down from €1.2 billion in 2022.

Lakeland said that the market downturn started during the third quarter of 2022, with buyers sitting on stock that had been bought at record high prices. It said that this resulted in a demand reduction as the market moved to work through higher priced products.

Consumer foods

The Consumer Foods category saw revenues of €207 million compared to the prior year’s revenue of €273 million. Lakeland said this category’s market was steady, with “solid demand” throughout the year on the domestic front.

Consumer demand across domestic markets in the UK and Ireland also reportedly held steady.

Agribusiness

The co-operative reported an increase in feed sales during 2023 while market prices fell.

It said that fertiliser prices had also reduced, and in tracking national and EU trends it saw a modest reduction in turnover within this category, stating that it hoped the trend would continue in 2024.

Lakeland “navigates volatility”

Lakeland Dairies CEO Colin Kelly said: “2023 was a difficult year for the dairy industry. Nobody, from farmer to processor, was disappointed to see the back of a year that challenged us at all levels. Global markets collapsed, costs at farm and processor level remained stubbornly high, interest rates reached levels not seen for decades, and inflation impacted every one of us both inside our homes as well as inside the business.

“However, despite all these challenges, the financial strength of the co-op and our robust balance sheet ensured that we were well-placed to navigated this volatility. Our revenues, EBITDA and operating profit before exceptionals all show a strong and resilient co-op.”

Kelly continued: “Notwithstanding these global trade issues, 2023 was truly a defining year for the co-op in our 130-year history, as we commenced our new strategy entitled Foundations for a Better Future.

“This strategy is focused on our business being for growth and embracing value-add opportunities that will benefit the co-op, our farmers and our people sustainably for the future. We are making strategic decisions that will benefit the co-op in the short, medium and long term.”