Graham's targets UK-wide market and reveals £1m profit for first time

GRAHAM'S, the family-owned dairy business, has seen profits break through the £1 million barrier as it seeks to become more of a UK-wide brand.

The Bridge of Allan-based dairy firm, which was founded in 1939, saw pre-tax profits jump 28 per cent to 1.05m in the year to 31 March on revenues of more than 41m.

The profits boost was secured against a turbulent background for the milk industry, with the Dairy Farmers of Britain, a co-operative, calling in the receivers last June.

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Rival Robert Wiseman Dairies, which is based in East Kilbride, was also forced to issue a shock profits warning in September, which was blamed on a supermarket price war.

Robert Graham, managing director of Graham's and grandson of the dairy's founder, said his businesses was protected from some of the wider market conditions due to its broader range of customers products, which as well as milk, include ice cream, butter and cream. The firm also has three brands across its product lines: "conventional", organic and gold.

"Strategically our business is very different from our competitors in terms of our customer and products mix," he said, playing down fears that the firm would be affected by supermarket price wars.

"Leading up to 2008 we didn't have the ups that a lot of other sectors had but conversely we won't have the same downs."

Graham said revenues in the current financial year - to 31 March 2011 - are likely to touch 50m as the firm benefits from a number of investments and significant supermarket deals.

This summer, Graham's secured agreements with Sainsbury's and Asda to stock some of its milk brands at stores across Britain, giving it a UK-wide distribution for the first time in its 71-year history.

Although both chains already stocked the dairy's milk in Scotland, Graham said this was a major step towards becoming more of a British - and not just Scottish - brand.

Graham's recently made a 1.1m investment in expanding its butter plant at Bridge of Allan, which will see it launch the first spreadable butter from a Scottish dairy next year.

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This summer it also acquired smaller rival Claymore Dairies in Nairn, marking its 25th acquisition since 1993.

Graham said the firm aims to get more products out into the UK-wide market place this year.

"Hopefully we'll see other retailers taking our products full UK and we'll hopefully see some of our ice creams go south as well.

"A big part of our strategy is going from a Scottish brand to a UK brand."

However, the firm will also pursue further expansion in its home market, he stressed."As a Stirlingshire-based family dairy, the Scottish market is at the heart of our business and we aim to continue growing our market share at home through brand and product development."

Despite the dairy firm's recent acquisition, Graham said it was unlikely to chase further deals in the current financial year.