Carbery Group, the Cork-based producer of Dubliner Cheese, says the Covid-19 crisis has now overtaken Brexit as the chief threat to the Irish food industry.
The dairy group has been investing heavily to shield the business from Brexit only to find itself in the crosshairs of a different crisis.
Later this year it will open a €78 million mozzarella-production plant at its flagship Ballineen facility in west Cork, diversifying its traditional focus on cheddar cheese, which is heavily reliant on the UK market.
Publishing its annual results for 2019, which show that sales increased by 3 per cent to €434 million on the back of strong growth across all segments, chief executive Jason Hawkins said: "Like all processors, we are closely monitoring volatile dairy markets across the world."
‘Uninterrupted’
He said the focus now was on maintaining “uninterrupted production processes”.
Food companies are facing a significant downturn in demand in 2020 with the coronavirus crisis causing the shutdown of food service and hospitality sectors across Europe and the United States.
Carbery , which is owned by four co-ops and employs more than 600 staff, processed a record 567 million litres of milk last year. That represents growth of 42 per cent between 2015 and 2019. EU milks quotas were lifted in 2015.
Group earnings before income tax and amoritsation (Ebita), or operating income, fell 7 per cent decreased to €30.2 million while its net debt position at the end of 2019 stood at €47.2 million, up from 30 million in 2018.
Carbon emissions
Against a backdrop of a 20 per cent increase in production across its eight manufacturing sites globally, Carbery said it was able to achieve a reduction in carbon emissions of 11.7 per cent. Since 2017, carbon emissions intensity per tonne of production has reduced by 28.5 per cent at its Ballineen plant.
Chairman TJ Sullivan said: “The challenges of Brexit continued to rumble on over the course of the year, with continually changing perspectives and predictions adding to uncertainty especially around the UK market, which is our main market for cheddar.
“However, current concerns around the impact of Covid-19 have, for now, overshadowed the potential implications of Brexit in 2020,” he said.
