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Lakeland breaks €1bn sales mark a year after forming

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Lakeland plant in Newtownards

Lakeland plant in Newtownards

Strong performance: Michael Hanley

Strong performance: Michael Hanley

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Lakeland plant in Newtownards

Cross-border dairy co-op Lakeland has reported sales of €1.03bn (£880m) but warned of challenges ahead from Brexit and the impact of Covid-19.

The Cavan-based firm collects around 1.05bn litres of milk from 1,250 farmers in Northern Ireland every year.

It currently pays farmers 25.25 per litre, with bonuses for volume and quality.

Lakeland said surpassing the €1bn mark for the first time meant that it had doubled group revenues in the past five years.

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Strong performance: Michael Hanley

Strong performance: Michael Hanley

Strong performance: Michael Hanley

The co-op was formed last year when Lakeland Dairies merged with LacPatrick Dairies in Monaghan.

It produces 240 dairy products, including catering portions of milk and butter, from eight processing sites and exports to 80 countries worldwide.

Group chief executive Michael Hanley described the company's latest results as strong.

"This is a positive outcome based on a strong and efficient performance across all operating divisions, Mr Hanley said.

But he warned of challenges from Covid-19 and Brexit, with the closure of restaurants, workplaces and bars leading to a slump in demand for suppliers in the dairy industry.

"The ongoing market disruption caused by the Covid-19 pandemic has put a significant drag on markets, particularly in the food service sector," the chief executive explained.

"A lack of clarity on the shape of the trading relationship between the EU and the UK post-Brexit is of concern to us too, not to mention the ongoing global dairy supply and demand dynamic, which has a huge influence on international markets."

The company recorded revenues of £881m across its four divisions of food ingredients, food service, consumer foods and agribusiness.

The figure was up £147.4m on the previous year, an increase of nearly 28%. It also reported an operating profit of £17.53m - up by £1.73m.

Revenues in its food ingredients division were £499.2m, up by 12.6%, following strong demand for products such as enriched powders and proteins.

There were revenues of £204.4m in the food service division, and consumer foods division sales of £119.46m. Agribusiness reported sales of £61.91m.

Company chairman Alo Duffy said: "This was a truly historic year for the dairy industry and the milk suppliers in the northern half of the island following the merger between Lakeland Dairies and LacPatrick Dairies in April last year.

"The merger that we have collectively and cooperatively achieved has been a success.

"This has enabled us to go from strength to strength and it is now instrumental in our capacity to deal with the current challenging times facing us all.

"Based on our positive achievements and our continuing co-operative endeavours, you may be assured that we will meet any such challenges and many opportunities with an absolute and unwavering determination to succeed.

"I thank each of our 3,200 farm families for the continued support of their society."

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