Arrabawn Co-Op has reported a record year for 2022 with its turnover reaching the €500m mark for the first time in its history.
The Co-Op said its EBIDTA was up by €5.6m to €18.1m, while operating profits for the year increased by €5.5m to €9.589m. The strong performance also enabled Arrabawn to reduce its net debt to €24.1m.
Arrabawn has over 1,000 suppliers across Munster, Leinster and Connacht. It said that critically from a supplier perspective, it achieved a record average milk price in 2022.
It said its strong performance was achieved despite a 29% increase in costs, with the biggest increases in fuel and power, which saw a 86% jump.
"Notwithstanding the remarkable year for dairy markets, it remained a volatile year, with significant challenges around energy prices, sourcing raw material for feed, fertiliser availability and general price inflation," Arrabawn said.
Arrabawn sold its liquid milk sales book and van sales fleet during the year, which it said was "a necessary step" as further consolidation in the retail sector, demise of small family-owned retailers and a very competitive foodservice business made trading extremely difficult.
CEO Conor Ryan said that 2022 was a remarkable year for Arrabawn, aided by an exceptional year for dairy markets.
"But a huge amount can be attributed to our record investment programme since 2018. This has seen the modernisation of processing to world class standards and is now delivering a better return to our members, as reflected in a really strong base price rise in the second half of the year," Mr Ryan said.
But he also said that 2022 was a challenging year in many respects, with costs up significantly, not least fuel and power.
"There were also some challenges around availability of fertiliser due to the Ukraine-Russia situation but thankfully we were able to ensure that supplies were available to all our customers," he added.
Chairman Edward Carr said that environmental targets are the biggest challenge the industry is facing.
He noted that the Government has set targets to reduce agriculture greenhouse gas emissions by 25% by 2030 and strive for carbon neutrality by 2050.
"Arrabawn is assisting its suppliers in this through its involvement in a range of programmes. These are important for the implementation of technologies that are already available and new ones that become available, without reducing the competitiveness of the Irish Agri Food sector," he added.
