Dairy lost over £10m before being gobbled up by Müller
A Lancashire diary slumped to a loss of more than £10m in the year before it was acquired by milk and yoghurt giant Müller, it has been revealed.
Yew Tree Diary has reported a pre-tax loss of £10.2m for the 12 months to 31 March, 2024.
The loss comes after the business made a pre-tax profit of £5.5m in the prior 12 months.
Newly-filed accounts with Companies House also show the firm’s turnover fell from £214.5m to £181.5m over the same period.
Müller’s takeover of Yew Tree Diary completes
The results come after the Competition and Markets Authority (CMA) approved the acquisition of Yew Tree Diary by Müller last month.
At the time, Yew Tree Farm director Carl Woodcock said: “As a family-owned and operated company, we’re very proud of the progress we’ve made and the organisation we have built over the last few decades.
“As it’s now time for us to move on to new opportunities, we know we leave the business in good hands with Rob and the rest of the team from Müller.
“It was important for us to hand over the reins to people who’d look after the business with the same care and consideration as we have over the years, and we’re confident that the values and goals we’ve seen from the Müller family are similar to our own.
“Joining Müller will help Yew Tree Dairy go from strength to strength, benefitting our staff, farmers and customers and creating a strong and successful future for the British dairy industry.”
Loss ‘not wholly unexpected’
In the newly-filed accounts, Yew Tree Farm said its pre-tax loss of over £10m was “not wholly unexpected” because “market trends are cyclical.
It added that it forecasts a return to profit in its current financial year.
The company added: “The 2023/24 year has been one of contrast, with the knock-on effects from the high milk price in the prior year being evident within the first six months.
“As farmers aimed to maximise the benefit from the high milk price observed within 2022/23, the overall milk production increased, with supply exceeding demand this had implications on the milk price.
“Declining milk prices and reduced profit margins have unsurprisingly led to a subsequent reduction in UK milk flows compared to the previous period.
“Aside from the much reduced average farm gate milk price when compared to 2022/23, the financial year saw continuing cost pressures within the diary industry.
“Throughout this period the directors took the decision to support their farmers by subsidising the pence paid per litre for contracted milk
“The company is well placed to react to these challenges by maximising production efficiencies and minimising supply costs whilst containing to support its farmers positively through our ingredient milk contracts.”