Analysis Companies
Irish Lakeland Dairies aims for more acquisitions like De Brandt
Irish dairy cooperative Lakeland Dairies is quite outspoken about its acquisition strategy. Over a month ago, Belgian butter trader De Brandt was already acquired, and the cooperative aims for more deals like this.
During the presentation of the annual figures this week, Lakeland Dairies' management extensively discussed the acquisition strategy. CEO Colin Kelly mentioned that they are looking forward to new acquisitions in the United Kingdom, the European Union, and the United States. In total, the management has €100 million ready for acquisitions.
They are particularly interested in dairy companies that add significant value, as this would align perfectly with the high-quality milk produced by the cooperative's 3,200 member dairy farmers. With this, Lakeland Dairies, after Tirlan, becomes the largest milk processor in the country. The recent acquisition of butter trader De Brandt from Belgium is seen as a good example of the type of companies they are interested in. By acquiring such companies, Lakeland Dairies believes it can add more value that ultimately benefits the milk price.
Significant profit drop
Currently, milk prices are under considerable pressure. In February, €1 was already taken off the milk price, and in March, another €2.50 per 100 kilograms. This brings the milk price down to just over €40 per 100 kilograms. The annual figures for 2023 also faced significant pressure. While revenue dropped by about 20% to €1.6 billion, profits plummeted by 54% to €14.8 million. Management described it as a challenging year.
