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Final Results for year ended 31 March 2012

24/05/2012

A video interview with senior Dairy Crest personnel and an audiocast of the presentation are available from the Investor section of the website.

- 2011/12 2010/11 Change
Revenue: £1,632m £1,605m +2%
Adjusted profit before tax* £87.4m £87.6m No change
(Loss) / profit before tax £(10.1)m £77.8m  
Adjusted basic earnings per share* 49.4p 47.1p +5%
Basic (loss) / earnings per share (12.8)p 43.2p  
Cash generated from operations £84.5m £128.1m -34%
Year-end net debt £336m £312m +8%
Proposed final dividend 14.7p 14.2p +8%

* Before exceptional items, amortisation of acquired intangibles and pension interest.

Financial Highlights

Total Revenue up 2%
• Strong growth in Foods (revenue +10%), supported by continued progress from key brands
• More focused Dairies business (revenue -2%), as action taken to improve customer mix

Adjusted profit before tax maintained in challenging trading conditions
Exceptional non-cash impairment charges in Dairies of £81.7 million leads to a reported loss
Key net debt to EBITDA ratio at 2.2 well within covenant of 3.5
Proposed final dividend up 4% at 14.7p per share, demonstrating a commitment to progressive dividend policy

Operating Highlights

Sales of five key brands up 11%

  •  Record market shares for Cathedral City and St Hubert in fourth quarter
    Innovation driving added value sales and efficiencies
  • 10% of sales now derived from products and services developed in the last three years, such as Chedds and Frijj the Incredible
  •  Milk&more weekly sales up to £1.2 million

Input cost increases of around £80 million recovered through cost savings and selling price increases £22 million annualised cost savings delivered during the year, with a further £20 million identified for 2012/13
Business In The Community gold award reflects strong commitment to Corporate Responsibility

Strategic highlights

Strategic review of French Spreads business progressing
Decisive steps taken since year end to return Dairies business to a satisfactory level of profitability in the medium term
Branded food acquisition, MH Foods, widened product portfolio

Commenting on the results, Mark Allen, Chief Executive, Dairy Crest Group plc said:

"Dairy Crest's results for the year demonstrate the continued benefit of being a broadly based business. Double digit growth in our branded Spreads and Cheese businesses has offset unsatisfactory results in Dairies.
We have maintained adjusted Group profits despite facing inflationary cost pressures of around £80 million this year by making annualised cost savings of around £22 million and achieving selling price increases. This has been made possible by a programme of consistent investment in developing our key brands and building a modern, efficient supply chain.
Going forward, we will continue to take decisive strategic action and proactively shape Dairy Crest for the long-term. In March 2012 we announced a strategic review of our French spreads business, St Hubert, which is progressing and since the year end we have also announced a series of actions to restore our Dairies business to a satisfactory level of profitability in the medium term.
In the current financial year, we are seeing continued strong momentum in our Foods businesses and we expect Dairies to benefit from the decisive action we are taking and our continued discipline on costs."

For further information:

Dairy Crest Group plc
Arthur Reeves 01372 472236

Brunswick
Simon Sporborg 020 7404 5959