Dairy Crest Shares Plunge

Dairy Crest today announces its unaudited results for the six months ended 30 September 2008.

Markets became more difficult towards the end of the first half as general economic conditions worsened. We have experienced upward pressure on input costs, notably raw milk, and lower realisations from ingredients markets, the company said in a statement.

Pretax profit will fall by about 10 percent in the current fiscal year, excluding exceptional items and amortization, the Esher-based company said. Dairy Crest also reported a 77 percent drop in first-half net income.

Net income dropped to 6.3 million pounds, or 4.7 pence a share, in the six months through September from 26.9 million pounds, or 20.2 pence, a year earlier, the company said.

Dairy Crest says it has cut 100 jobs from its head office and distribution operations, in an effort to reduce costs. The company is also proceeding with plans to close a Nottingham bottling plant with the loss of a further 215 jobs.

The city clearly didn't like the figures. Shares plunged 26% to 244p shortly after they were released.

Scottish rival Robert Wiseman warned on Friday that lower cream prices could hit its second-half results.