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Top dairy companies: profitability and growth in the dairy industry
Mathieu Geuskens published on June 8, 2022
Financial data can reveal a lot about the performance of an industry. In our dairy trend report, we looked at the financial data of the top 300 dairy companies in Western Europe. We focus on the following themes: growth in net sales (CAGR), profitability (EBIT) and return on assets (ROA) across the different links of the value chain. In this blog, we zoom in on the top dairy companies in terms of growth and profitability.
Fast growers: the top dairy companies in terms of growth
Numidia is a dairy commodity traders that has experienced strong growth in recent years, demonstrating the benefits that can be gained from a volatile market combined with growing capacity at large dairy producers.
Poelmeyer is a German producer of cheese, with three distinct brands. The company likely benefited from its strong retail presence subsequent demand for higher quality products for at-home consumption during lockdowns.
Vandersterre is a Dutch cheese processor and trader, focused at added value cheeses and with a good portfolio in terms of sales channels. Growth is driven in large part by the acquisition of a company called DupontCheese, although organic growth has also been achieved.
4. Royal A-ware
Royal A-ware is a large Dutch producer of dairy products, primarily cheese. Growth in 2020 was driven by the opening of addition of a new mozzarella factory. Future growth is expected as well: the company acquired a milk powder factory in Aalter, Belgium in November 2021.
Similar to Numidia, Farmel is a dairy commodity trader that benefitted from the volatile market and experienced strong growth in 2020.
In our report, we examined the performance of the European dairy industry with recently updated data for 2020. Below you can see their performance based on net sales and growth development between 2019 - 2020.
Most profitable: the top dairy companies in terms of profitability
1. Latteria Montello
Latteria Montello produces Italian fresh cheeses (like mozzarella and burrata) with protected origin and sells them under their own brand.
The same as Latteria Montello, Deliziosa is a producer of Italian fresh cheese and profits from the protected origin of their products. with protected origins and sells them under their own brand. protected origins and sells them under their own brand. protected origins and sells them under their own brand.
Galbani is owned by Lactalis and one of the largest producers of fresh mozzarella and other Italian cheeses with a strong international branded presence in retail.
4. Credition Dairy
Crediton Dairy produces (flavored) dairy drinks and ice coffee from Devon milk, boasting strong local origin branding. As with most fresh dairy products, these dairy drinks are almost exclusively sold through retail.
Danone is the largest dairy producer in the world, its product range is diverse with a focus on added value: branded (fresh) dairy products and specialized nutrition solutions (e.g. infant formula). Furthermore, as a stock market listed company, margins are more important than for family-owned or cooperative dairy companies.
We also looked at the most profitable dairy companies in our report. What is striking is that there is a very clear pattern in this selection of the top five most profitable dairy companies: all companies have a strong focus on added value.
Dairy industry: scale and balanced portfolio decisive for strong results
The longevity and maturity of the dairy industry helped many dairy companies cope with the market disruption COVID-19 caused, unlike several other food industries. Scale and a balanced portfolio have contributed significantly to protecting net sales and profitability in 2020, strengthening the position of large, integrated dairy players. Together with value-added strategies, these are the two key success factors in the current and future European dairy industry. A lack of these strategies will lead to further consolidation of the sector - exacerbated by the current supply chain shortages and cost increases. A shake-out is far from not unlikely, which is either a threat or an opportunity - depending on where you stand and how you act.
Are you interested in learning more about some of our other findings on the dairy industry? Download our latest trend report using the button below.