Carbery’s carbon emissions reduced with sustainable production growth

BALLINEEN-based international ingredients and cheese company, the Carbery Group, has reported a solid financial performance for the year ended December 31st, 2019, having acted demonstrably on its commitment to responsible expansion and sustainability across the group.

Carbery’s chief executive officer, Jason Hawkins, said that, while the positive business results were a major achievement, what he and his team are most proud of is how these results have been achieved. ‘At Carbery, we have been focusing on how the business performs, but also on how we do business. Due to our co-operative model and our close relationship with our farmer suppliers in West Cork, we have always been connected to the community and the product that we produce.

‘Throughout 2019, we have been working on how we can safeguard the future of our business, while improving on that connection and commitment, both in Ireland and in our operations across the world.

He said: ‘It’s hard to believe, as we reflect on 2019, that the challenges posed by Covid-19 in 2020 were on the horizon. Looking forward, Carbery Group is focused on our business continuity plans and managing the situation so we can maintain uninterrupted production processes across our businesses throughout this crisis.

‘Our cheese diversification project has been slightly delayed but is almost complete,’ he added. ‘Like all processors, we are closely monitoring volatile dairy markets across the world. Our primary concerns, as we remain at the peak of this crisis, are to safeguard the health of our employees and our farmer suppliers, as we endeavour to maintain production.’

Investment

The cheese diversification investment of €78m has demanded a significant amount of energy and focus from the Carbery team in Ballineen in 2019 and, while slightly delayed, Carbery expects the new mozzarella line will be operational in 2020.

Growth in 2019 has been driven by expansion across all platforms: Carbery’s Nutrition business continued to grow and performed strongly in 2019 and a commercial base was opened in Shanghai during the year.

Strong performance across the group’s taste division Synergy was driven by the continuing implementation of the newly updated global strategy. 2019 saw the opening of Carbery Group’s first customer centre in Indonesia.

The Americas Taste business continues to deliver strong results and 2019 saw the launch of the Dairy Taste portfolio in the Americas market and the expansion of Synergy’s US headquarters in Wauconda, Illinois.

In terms of future plans for growth across the group, Jason Hawkins stated that, ‘While we are committed to growing the company, underpinning our growth ambitions is a focus on growing in a sustainable way, which will guarantee a stable and successful future for our business, our shareholder suppliers, our people, the community and the environment.’

Performance

Group turnover increased by 3% to €434.1m in 2019, but pre-tax operating profit decreased year-on-year by 7% to €30.2m. The group’s net debt position at December 31st last was €47.2m (2018: €30.1m). Milk volumes increased by 6% in 2019 to 567 million litres.

TJ Sullivan, chairman of the Carbery Group board, commented that, ‘Financially, our 2019 performance was strong and in line with our targets, while we continued to evolve our business strategy. We also supported the milk price for our farmer suppliers from business profits and using our stability fund.

‘Post the elimination of quotas in 2015, our milk volumes have grown by 42% to 567 million litres which we have processed entirely at our site in Ballineen in 2019.’ Looking forward, he assured the farmer suppliers and their families, who were ‘a huge part of our 2019 growth,’ that Carbery are doing all they can to continue to protect this growth throughout 2020 and the current Covid-19 crisis.

Growing sustainably

AGAINST a backdrop of a 20% increase in production in its eight manufacturing sites globally, the Carbery Group was able to achieve a reduction in carbon emissions of 11.7%.

Some of the initiatives driven by the group’s corporate responsibility and sustainability strategy include:

•  Since 2018, electricity purchased has been 100% from renewable sources through a green tariff.

•  Its ‘Every Drop Counts’ water programme has saved 1.4m litres of water per day in Ballineen.

•  The Carbery Greener Dairy Farms programme provides support to help farmers reduce energy use and carbon emissions. The 25 farms participating have reduced emissions by 15%.

•  In summer 2019, a small-scale grass bio-refinery was tested on five Carbery farms in West Cork – the first of its kind to be trialled in Ireland and one of the first in Europe.

•  An ethical procurement policy which outlines expectations on environmental, social and human rights aspects related to procurement is being built into the contracts process.

•  95% of the paper and cardboard bought in Ballineen is certified sustainable

•  From 2020, the group will begin light-weighting plastic packaging and sourcing alternatives with a view to reducing the amount of plastic used by as much as 10 tonnes a year.

Carbery Group has been recognised for many of the improvements made to their processes and the group aims to be carbon-neutral by 2035 across all sites through decarbonising existing energy sources.