Despite globally challenging market conditions including the impact of a continued weak pound and changes in fat and protein prices, Arla Foods UK delivered a steady start to the first half of the year.
A 6.7% volume driven branded growth contributed to an overall net revenue growth of 2.3%, comparative to the first half of 2017, increasing revenue to £961m.
The 6.7% strategic branded sales volume for Arla Foods UK was supported by the core Arla brand at 9.3% growth, as well as Lurpak at 2.2% growth and Castello at 8.8% growth in the UK. Within the Arla portfolio, Arla’s foodservice range Arla Pro grew by 52.8% whilst sales of B.O.B (Best of Both) grew at 38.1%.
Arla Foods UK Managing Director, Ash Amirahmadi commented: “Year on year, Arla’s portfolio continues to lead the way in driving growth across the UK dairy sector. Our decision to invest to build capability in the growing channels of foodservice, online and convenience is paying off and will continue to do so as we further develop the UK business.”
Each year, Arla targets an annual net profit share in the range of 2.8-3.2% of revenue. This allows the company to balance its retained capital for future investments and provide a supplementary payment to farmer owners, while continuing to pay out the highest possible share of our ongoing profit to our farmer owners via the prepaid milk price throughout the year.
In the first half year of 2018, Arla delivered a net profit share of 2.2%, up from last half year’s profit share of 2.1%. The company expects to reach its full year net profit share to be within the 2.8-3.2% target range.