Arla Foods does not expect to achieve its budgeted result for the full year.

Whereas falling exchange rates for GBP and UDS had a moderate impact on the first six months of the financial year, the trend accelerated during the second half year. Arla Foods, therefore, does not expect to achieve the budgeted result for the full year.
Profits for the first six months were DKK 346 milion against DKK 425 milion last year.

Alongside the declining exchange rates Arla Foods has been affected by increasing price pressure in export markets and by the fact that EU subsidies have not increased correspondingly.
A further factor is the current trends in the German market where consumers are turning away from higher-priced products in favour of discount stores.
Rising energy costs during the first half year have also played a role. Overall, extra energy costs are expected to total DKK 50 to 60 million for the year.

In March Arla Foods’ Managing Director, Jens Bigum, informed the company’s Board of Representatives that the budgetary targets for the current year were unlikely to be met.
”We don’t expect to see an early improvement in trends and have to accept that we will not be able to meet our target for the year,” Jens Bigum told the Board of Representatives.

Following a reduction in the on-account payment to the company’s co-operative shareholders profits in the region of DKK 900 million are expected for Arla Foods’ dairy activities for the full year.