DAIRY products group Dairy Crest announced a bitter sweet trading update for its Merseyside plants.
While confirming its Aintree milk bottling plant would benefit from a £75m three-year investment across its four sites, it confirmed it was in talks with staff to cut jobs at its butter and spreads operation in Kirkby.
The investment followed the recent renewal of a fresh milk contract with Sainsbury’s.
Chief executive Mark Allen said this would allow the company to drive “further cost efficiencies, remain competitive and maintain high levels of service to our customers”.
However, a spokesman said Aintree would only see “some” of the investment which would be targeted at dairies supplying supermarkets.
The trading update for the nine months to December 31 also revealed that the group had identified “potential efficiency savings” at its Kirkby site which employs 120 staff making the Utterly Butterly and Clover brands.
The spokesman added: “We don’t know how many roles will be affected until the consultation process is complete by the end of February.”
But he said they “absolutely want to keep that site open”, adding: “We are just trying to drive some efficiencies.”
The update revealed that profits were slightly ahead of expectations, after continued strong trading from key brands, including Cathedral City.
It reflected a “strong performance” in the final quarter of 2009, helped by a further increase in sales of milk to supermarkets.
Since then it has benefited from the recent cold snap as increased demand caused a 17% spike in milk volumes in the first week of January.
Total sales were 1% lower in the nine months to December 31, reflecting lower sales of commodity ingredients and milk to non-major retail customers.
Its five key brands of Cathedral City, Country Life, St Hubert Omega 3, Clover and Frijj were supported by high levels of television advertising and promotions, helping sales of the brands to rise by 10% against a year earlier.
Mr Allen added: “We remain cautious about the trading environment for 2010, but the improvements we have made to our business during 2009 leave us well positioned to cope with the challenges.”
Liverpool stockbroker Panmure Gordon increased its profits forecast for the year to March by just under £1m to £83m.
