Kerrygold owner Ornua has reported higher revenues and operating profits for 2018 on the back of a "standout" year for its butter brand.
Ornua, the country's biggest exporter of dairy products, said its revenues for last year rose by 0.6% to €2.082 billion, while its operating profits increased by 14.8% to €35.2m.
Ornua exports to over 110 countries around the world and it sold a total of 3.4 billion litres of milk equivalent during the year.
Kerrygold is now the second biggest butter brand in the US with 2.6 million packets of butter sold each week there, while Kerrygold is also the fastest selling product of all food and drink brands in the German retail market.
"20 years ago we shipped a pallet of butter to the US, and today we sell 2.6 million packets of butter a week in the US," Ornua CEO, John Jordan said. "It's a phenomenal success story. It's one that Ornua and Irish farmers should be very proud of."
The popularity of Kerrygold butter has been seen across social media with celebrities like Sarah Jessica Parker regularly tweeting about how much she loves the product. As recently as yesterday, actors Danny DeVito and Colin Farrell were talking about Kerrygold butter online. Mr Jordan said the publicity is a testament to the quality of Kerrygold.
Today's results showed that Ornua paid a total end of year bonus of €19m to its co-op members, an increase of 27% on 2017.
Last year it bought 570 million litres of milk equivalent under fixed price contracts, helping to protect against volatility.
The UK remains a key strategic market for Ornua and the company has been preparing for the potential impact of Brexit for the last two years.
"One of the biggest difficulties is the lack of clarity. We can't develop long term strategies when we don't know the rules of the game," Mr Jordan explained. "We have looked at a number of mitigating factors. It has brought us closer to our customers because we have engaged in a very detailed conversation around the security of supply."
Mr Jordan said the tarriff proposals that the UK suggested a couple of weeks ago would be hugely detrimental and could add about €55m to the cost of Ornua's exports to the UK.
"Anything that adds cost will make us less competitive in the UK market, and that is a risk to our business," Mr Jordan said.
Debt on Ornu's balance sheet is in part linked to Brexit planning.
"There is two elements to that. 2018 was a very unusual year for weather in Ireland. We had sleet and snow in March and we'd a very long dry summer, which is good for us, but not great for grass production, or Ornua. So there was a lot of late season grass production."
"A significant part of it was around Brexit planning. What we have assured our customers is security of supply."
Ornua has moved stock from Ireland to the UK. It has also built and increased stock in the UK ahead of any disruption to the supply chain or tarriff costs that might come in.
Ornua has also looked at other markets to de-risk the business against Brexit. "One of the big challenges is market diversification takes a long time. It takes sustained investment and sustained work on the ground," the group's CEO said.
"If you look at our markets, we are exporting about 300 billion litres of milk equivalent to 110 markets around the world. We are the number one butter brand in Germany, number two butter brand in the US, but that took time and it also takes sustained investment."
