The turnaround was achieved through some drastic surgery which included selling off the loss-making Glenfield soft cheese business and the Westbury skimmed milk powder, butter and cream operation. These and other streamlining moves saw the company turnover shrink from £442m to £291.5m while bank debt halved from £60m to just over £30m.
NFU Scotland’s milk policy manager George Jamieson, said the stabilisation of the business would not have been possible without the sacrifices of the supplying members.
“Without the member owners accepting a milk price that had no chance of covering their own costs, the recovery would not have been achievable,” he said. “While the business has become more financially resilient, the farmer owners are now significantly worse off.”
Jamieson was pleased First Milk was now lifting its price ahead of the market but claimed farmers still faced a huge task in reaching profitability and sustainability.
“We know that First Milk are aware of this but we would stress that while the company has made significant financial progress, there must be an equal commitment to the needs of the owners,” he said.
First Milk chairman Clive Sharpe said he was pleased that improvements in financial performances had continued with operating profit on track to be in excess of 2016.