Cork-based dairy processor Dairygold has reported a slight increase in revenue and profit for 2024 on the back of improved dairy market conditions.
It comes despite a slight reduction to overall milk output alongside lower feed and milk prices.
The State’s third largest milk processor said turnover rose by €10.6 million (0.8 per cent) to €1.43 billion in 2024, following a €254.7 million drop in revenue during 2023 due to market conditions.
Dairygold’s financial performance was described as “satisfactory” by the company.
Operating profit grew at the co-operative to €37.1 million, or 55 per cent, on the €23.9 million made in 2023, though still lagging behind the €40 million profit in 2022.
Chief executive Michael Harte said the company has implemented an increased drive for efficiency in 2025 with an emphasis on “continuous improvement” and automation. This is part of a targeted €14 million in cost efficiency across between 2025 to 2027, with half of the savings aimed for this year, he told The Irish Times.
As a result of these factors, he said a reduction in the company’s total workforce was expected to take place with up to 70 jobs set to be reduced by “attrition”.
Dairygold’s bank debts rose for the third year in a row to €157.3 million, increasing by €12.8 million (8.9 per cent). The increased debts have resulted in a net bank debt to Ebitda ratio of 2.4:1 which the company described as “very manageable”. The debts, they said, resulted from capital investment of €48.9 million and subsidiary acquisition.
While the overall dairy market experienced a resurgence in 2024, weather conditions in Ireland for the first six months of the year were challenging for farmers. That resulted in a slight reduction in milk supply from Dairygold members of 2.1 per cent to 1.38 billion litres.
“Dairy Ireland sales volumes of 226,000 tonnes were back on 2023 levels, reflecting lower milk volumes,” said Mr Harte, though the subsidiary saw turnover increase 4 per to €830 million. The price paid to the co-operative’s suppliers increased with average quoted milk price rising by 6 per litre (cpl) to 44.9cpl.
Despite this, elements of the sector saw prices decrease, with Mr Harte noting the drop in birth rates in China as a “notable factor impacting certain dairy market returns”.
He said the resulting reduced demand for infant formula products, of which Dairygold’s demineralised whey is an ingredient, caused oversupply issues in the market.
“Consequently, returns from demineralised whey in 2024 were lower compared to the returns for other whey products,” Mr Harte said.
The Dairygold chief executive said he believes their milk price competitiveness will improve in the coming year, with the introduction of a new casein milk protein production plant, improved performance in demineralised whey, and to efficiency.
Mr Harte said he had expected the milk price to land around 50cpl in 2025 which would represent an increase on the rate of 45cpl common in Ireland this year but that tariffs could impact that price.
“The big thing that is hanging over the market at the moment is the tariffs, and we are all waiting to see what the implications and the fallout in relation to the tariffs will be.”
Mr Harte said Dairygold has a “very, very small” direct exposure to tariffs but highlighted the impact tariffs could have indirectly due to its supply partnership with Ornua. He credited Ornua as having done a “phenomenal job” establishing Kerrygold in the US.
“The one concern I have about the tariffs is the impact on the Kerrygold brand longer term,” he said, noting his concern that the brand could be impacted by changes to price or volume in the US.
