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Trading statements

Dairy Crest FY outlook unchanged

18 July 2017 07:23

Dairy Crest's trading in the first quarter was in line with expectations and the outlook for the full year remains unchanged, according to an update issued ahead of today's annual general meeting.

It said combined sales volumes of Dairy Crest's four key brands - Cathedral City, Clover, Frylight and Country Life - were 7% ahead of the corresponding period last year.

It said Cathedral City, Clover and Frylight had all grown strongly; in particular, Cathedral City volumes were up 15% on last year.

It added: "Cream prices, which determine input costs for the butter business, have increased substantially during the first quarter. This will put pressure on margins in our butter business.

"We have reduced our promotional activity on Country Life, which is adversely impacting volumes but mitigates some of the margin pressure."

Chief executive Mark Allen said: "The year has started well and our branded business has delivered good growth in the first quarter.

"The functional ingredients business continues to progress well and new customers are being signed up. We still expect that the profit contribution from this business will be second half weighted.

"Dairy Crest is well positioned for long-term sustainable profit growth. Despite the pressure on butter input costs, the strong performance of our cheese business means that our expectations for the year remain unchanged."

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