Group turnover was up 7.8% to £272.3m, driven by volume growth with existing and new fresh milk customers and its export cheese partner, its latest annual report and accounts showed.
Operating profit was “stable” at 2.6% of turnover (£7.2m), the British farmer-owned cooperative said.
Net debt fell by £3.8m year-on-year from £44.9m in 2018 to £41.1m in 2019, while its net assets grew by £4.4m year-on-year to £31.8m.
“With a strong platform in place, we are committed to maximising the value we return to our members,” said First Milk chief executive Shelagh Hancock.
“We remain clear that prosperity comes from building demand, growing capacity and securing supply – in that order. The dairy world is changing fast; economically, socially, technologically and politically.
“We will continue to be agile and adaptable, broadening our base and collaborating to deliver optimal supply chain solutions that deliver benefit for our members and our customers.”
Majority of cheese is sold through Ornua
The dairy business produces Cheddar, Red Leicester and Double Gloucester – the majority of which is sold through its partner Ornua, which supplies more than 40% of the hard cheese sold in British retailers and is the largest buyer of British cheese in the UK.
In addition to increasing its UK cheese sales, First Milk said it had continued to develop its strategic partnership with its export partner and now supplies more than 21 countries including Saudi Arabia, Turkey, Jordan, Australia, Uruguay, the Philippines and Taiwan.
As part of its fresh milk division, the Glasgow-based cooperative remains Nestlé’s single-largest UK supplier, with milk going into Girvan for chocolate crumb manufacturing and into Dalston for the production of the Nescafé cappuccino ranges.
Collaboration with Yeo Valley
First Milk also has a collaborative milk sourcing and supply chain management partnership with Yeo Valley, providing conventional milk for its own-label manufacturing.
First Milk’s capital investment programme would continue over the next two years, the report showed, with “significant ongoing investment” at its Haverfordwest and Lake District creameries.
This would deliver energy and cost savings as well as improving productivity and realising additional processing capacity, it said.
Earlier this month, First Milk confirmed it had entered a consultation to close its creamery in Arran, Scotland.
The company revealed plans to sell the site – as well as another in Campbeltown – in April last year, after deeming them to not be a “strategic fit” for the business.
