Carbery Group turnover increases by 1.5% to €423.5 million in 2018

BALLINEEN’S Carbery Group, has reported a solid financial performance for the year ended December 31st, 2018.

Celebrating 50 years of production in 2018, the West Cork-based international ingredients company’s turnover for the year was up 1.5% (+2.9% on a constant currency basis) to €423.5 million from €417.3 million in the previous year. 

EBITDA (earnings before interest, tax, depreciation and amortisation) increased by 5.2% to €43.9 million, up from €41.8 million in 2017, and the Group reported increased EBITA (operating profit before interest, tax, amortisation and exceptional items) of €32.4 million (2017: €31 million) an increase of 4.5% (+10.6 % on a constant currency basis).

Jason Hawkins, the chief executive officer of the Carbery Group, commented that the positive business results reflected the strong trading performance across all three of Carbery’s key business platforms of Dairy, Taste and Nutrition. 

‘Despite some difficult farming conditions throughout the first half of 2018, milk supply from our farmers increased by 5%, continuing our consistent growth of milk supply,’ he said. ‘Each of our businesses performed in line with our expectations, allowing us to continue to pay a leading milk price to our shareholders, while also extending support payments for longer periods to support farmers through the severe weather conditions at the start of 2018.

‘As we look forward, acknowledging uncertainties in relation to Brexit and other challenges we may face in the dairy market, we are actively addressing these challenges by diversifying our offering in order to expand into new geographic markets to grow and future-proof our business,’ he said.

Supplies of milk to Carbery’s processing facility in Ballineen increased by 5% to 536 million litres, up from 509 million litres in 2017. Mr Hawkins also noted that the board of Carbery declared a €4.3 million bonus based on 2018 milk supply and took the decision to set aside this amount for its Stability Fund, for future payments at times of price volatility.

During 2018, Carbery invested a further €18 million across its global operations, bringing total investment in the business over the past five years to a total of €90 million. Recent investments have included extending its facility at Wauconda, just outside Chicago, to increase manufacturing capacity for its markets in the Americas. 

Carbery also acquired the Italian flavour company Janousek, to further develop the company’s flavour footprint in Europe and recently announced the doubling in size of its Asia operations at Samut Prakan in Thailand, which was necessary to meet the growing demand for innovative flavour solutions in the Asia-Pacific markets.

Mr Hawkins stateds: ‘We are about to enter a significant period of expansion and investment. We have committed to investing a further €100 million in the business over the next two years alone, as Carbery seeks to diversify and grow its business internationally.  

‘€78 million of this investment has been set aside for a new manufacturing facility at the Ballineen site, which will allow Carbery to diversify from its exclusive production of cheddar cheese into an expanded range of new cheese offerings, including mozzarella. This is in response to increased market growth and consumer demand for mozzarella and other cheese varieties in emerging markets.’

Commenting on the market outlook for 2019, Jason Hawkins said that Carbery Group is well positioned to grow the company and continue to deliver strong business results, providing a competitive milk price to its shareholders.

‘We are committed to growing our business on a sustainable basis, delivering on our promises to our farmers, our employees, and our local community. We believe that the Group’s global approach to business, coupled with continuing investment in new products and market growth opportunities, will put us in a strong position to deal with perceived challenges over the long term. 

‘I would like to thank all of our dedicated milk suppliers in Bandon, Barryroe, Drinagh and Lisavaird co-ops and their families that support them for their commitment to Carbery. We look forward to continued growth and success in 2019 and beyond,’ he concluded.