Carbery Milk Products, the Cork dairy group owned by the four West Cork co-ops, has reported strong profit growth for 1997, with profit margins boosted by lower milk prices, the strength of sterling and a good performance from its food ingredients division.

Profits jumped 11 per cent to £4.94 million although weaker dairy markets in the first half of last year were responsible for a fall in turnover from £94.3 million to £91.1 million. This is the second successive year Carbery has reported lower turnover although it has once again been able to boost its profit margins from 4.6 per cent to an impressive 5.2 per cent.

Chief executive Mr Dan McSweeney warned, however, that the outlook for the current year is uncertain. While the continued strength of sterling benefits Carbery's cheese and ingredients exports, the British cheese market is weak with prices depressed by green pound revaluations.

Carbery has diversified successfully from its original core cheddar business and its Dubliner cheese now accounts for 10 per cent of its cheese output and is sold in the UK, Denmark and Belgium as well as the domestic market. Carbery is also a major supplier of mozzarella for the pizza industry and this part of the business is performing "reasonably well", said Mr McSweeney.

He said the good results were achieved at a time when Carbery continues to pay very strong milk prices to its suppliers, which are drawn from members of the four co-ops which own Carbery - Drinagh, Barryroe, Bandon and Lisavaird. Carbery has 2,200 milk suppliers who supply 320 million litres of milk a year.