Twelve months into the turnaround of the farmer-owned co-operative First Milk, CEO Mike Gallacher and the First Milk Board have been briefing co-op members at meetings across the UK this week. While the industry outlook remains hugely challenging, the team has reported strong progress against the plan outlined in 2015.
Over this period the business has made major changes in its strategic direction, governance and leadership, putting a focus on its core cheese and brokering business and bringing in a heavyweight commercial leadership team. The management team reports that it has moved fast to reshape to fit the new strategy, exiting loss-making ventures and driving operational improvements. Combined, this has delivered a return to operating profit at year end.
The business now expects to deliver an operating profit (before restructuring costs) of £4m for the year to 31 March 2016, against a loss of £20m for the previous year. At the same time, the debt of the business has reduced to £33m from a peak of £84m in 2014/15.
Mr Gallacher reported to members: "We are on track and have made significant progress in reshaping the business and improving the operational performance, against a backdrop of a worsening dairy market. As we move into the second year of our turnaround, the focus will be on continuing to drive a wide range of operational improvements aimed at improving our efficiency and delivering a better service to our customers."
Market round-up
Harrison & Hetherington Ltd had 406 store cattle forward in St Boswells on Thursday when heifers sold to £1040 per head and 243.3p per kg to average £746.54 and 201p (-10p on the fortnight), while bullocks peaked at £1110 and 257.6p to level at £924.04 and 216.5p (-4.5p).
C&D Auction Marts Ltd sold 2938 prime hoggs in Longtown on Thursday to a top of £99 per head and 218p per kg to average 178p (+7.5p on the week).
A smaller show of 2321 cast sheep saw heavy ewes sell to £144 for Texels and average £84.60 (+£2.73), while light ewes peaked at £95 for Lleyns and levelled at £57.56 (+£5.50). Rams sold to £150 for a Texel and averaged £96.19.
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