Ornua Records 8% Decline in Operating Profit for 2023 Amid Challenging Dairy Market
Source: The DairyNews
Ornua, Ireland's foremost dairy exporter and the proprietor of the renowned Kerrygold brand, has disclosed a decrease of 8.2% in operating profit, amounting to €116.8 million for the fiscal year 2023.
The financial results, unveiled today (Wednesday, April 24), underscore the nuanced landscape of the dairy industry amidst prevailing market adversities.
Despite registering a turnover of €3.39 billion, a marginal decline of 0.7% from the previous year's figure of €3.42 billion, Ornua demonstrated resilience amid challenging market dynamics. The Group's Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) also saw a dip, decreasing by 4.6% to €149 million compared to €157 million in 2022.
Acknowledging the testing conditions encountered by the Irish dairy sector throughout 2023, Ornua affirmed its performance as robust. The co-op highlighted the significant contribution of €1.6 billion worth of Irish dairy products to sustaining robust returns for member co-operatives and supporting approximately 14,000 Irish dairy farming families.
In an effort to fortify its operational capabilities, Ornua inaugurated a new €40 million development at Kerrygold Park in October, bolstering production capacity to approximately one million retail packs per day. Additionally, the introduction of 26 new Kerrygold products and extensions in key markets further underscored Ornua's commitment to innovation and market expansion.
Despite grappling with inflationary pressures, price volatility in branded categories, and intensified market competition, Kerrygold sustained volume sales growth in the US, solidifying its position as the second most popular branded butter in the market.
Ornua's unwavering dedication to its member co-ops was manifested through brand premium and bonuses amounting to a value payment of €74.5 million, alongside the provision of €481.5 million in working capital facilities to support member co-ops.
Looking ahead, Ornua remains cautiously optimistic about navigating the evolving market landscape. Donal Buggy, interim chief executive of Ornua, emphasized the group's adaptability and resilience in responding to global trading instabilities, expressing confidence in achieving sustainable growth in key markets amidst persisting uncertainties.
Furthermore, Ornua's commitment to environmental sustainability is underscored by its concerted efforts to reduce emissions, with a notable 12% reduction in Scope 1 and 2 emissions globally in 2023. The organization aims to achieve a 30% reduction in Scope 3 emissions by the end of the decade, aligning with its overarching sustainability objectives.
In a strategic leadership transition, Conor Galvin has been appointed as the new chief executive of Ornua, effective May. With a wealth of experience in the dairy industry and a proven track record of leadership, Galvin's appointment signals a continuity of Ornua's commitment to driving growth and innovation in the global dairy market.
Despite registering a turnover of €3.39 billion, a marginal decline of 0.7% from the previous year's figure of €3.42 billion, Ornua demonstrated resilience amid challenging market dynamics. The Group's Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) also saw a dip, decreasing by 4.6% to €149 million compared to €157 million in 2022.
Acknowledging the testing conditions encountered by the Irish dairy sector throughout 2023, Ornua affirmed its performance as robust. The co-op highlighted the significant contribution of €1.6 billion worth of Irish dairy products to sustaining robust returns for member co-operatives and supporting approximately 14,000 Irish dairy farming families.
In an effort to fortify its operational capabilities, Ornua inaugurated a new €40 million development at Kerrygold Park in October, bolstering production capacity to approximately one million retail packs per day. Additionally, the introduction of 26 new Kerrygold products and extensions in key markets further underscored Ornua's commitment to innovation and market expansion.
Despite grappling with inflationary pressures, price volatility in branded categories, and intensified market competition, Kerrygold sustained volume sales growth in the US, solidifying its position as the second most popular branded butter in the market.
Ornua's unwavering dedication to its member co-ops was manifested through brand premium and bonuses amounting to a value payment of €74.5 million, alongside the provision of €481.5 million in working capital facilities to support member co-ops.
Looking ahead, Ornua remains cautiously optimistic about navigating the evolving market landscape. Donal Buggy, interim chief executive of Ornua, emphasized the group's adaptability and resilience in responding to global trading instabilities, expressing confidence in achieving sustainable growth in key markets amidst persisting uncertainties.
Furthermore, Ornua's commitment to environmental sustainability is underscored by its concerted efforts to reduce emissions, with a notable 12% reduction in Scope 1 and 2 emissions globally in 2023. The organization aims to achieve a 30% reduction in Scope 3 emissions by the end of the decade, aligning with its overarching sustainability objectives.
In a strategic leadership transition, Conor Galvin has been appointed as the new chief executive of Ornua, effective May. With a wealth of experience in the dairy industry and a proven track record of leadership, Galvin's appointment signals a continuity of Ornua's commitment to driving growth and innovation in the global dairy market.
