Overseas subsidiaries of the Irish Dairy Board returned satisfactory financial results for 2002, its managing director, Dr Noel Cawley, said yesterday.He announced that turnover increased by 1.4 per cent to €1.8 billion. The group operating surplus of €36.7 million and surplus before taxation were in line with the previous year.
"In addition to paying the net market return for product purchase, the strong performance of the group's overseas subsidiaries offset the cyclical effect of weak dairy market returns on the group's overall performance," he said.
As a result of that strong performance, he said, almost €11 million was paid to members through a year-end cash bonus and a redemption of loan stock.
The Irish dairy industry, which Bord Bainne represents, experienced a year of protracted low prices in 2002.
Dr Cawley said the situation in relation to milk powder had improved by the end of the year. However this had little impact on the returns to the Irish producer.
"The main problem here was that things are a lot better than this time last year in world markets but because of currency fluctuations, dairy farmers are not receiving the returns," he said.
He said the operations of overseas subsidiaries, which were responsible for 60 per cent of the board's turnover, had performed very well.
In the United States, the DPI food distribution group had a succesful and profitable year and had concluded a preferred distributor agreement for gourmet food products with one of the major national retail chains there.
He said that apart from the direct benefits involved in the contract, which would run for some years, the agreement paved the way for similar national programmes with other major US food chains in the future.
It also provided a major outlet in the US for Irish dairy products.
Dr Cawley said worldwide sales of Kerrygold branded products were up almost 4 per cent on 2001 with most markets showing increases in turnover. While butter sales generally had declined by 2 per cent in the UK, Kerrygold butter sales increased.
Germany, he said, continued to be the most important consumer market for Kerrygold with the brand accounting for 13 per cent of total butter sales despite a decline in per capita consumption.
In Spain, Kerrygold butter maintained its 2001 sales levels but branded cheese sales increased by six per cent.
Asked if the ending of Bord Bainne's sponsorship of the Royal Dublin Society's Horseshow after 14 years would impact on international Kerrygold sales, Dr Cawley said he didn't think so.
"We were in there for 14 years and it was good while it lasted. It was good for us and good for the RDS as well," he said.