Land O'Lakes Inc., Arden Hills, Minn., reported today that its dairy foods segment was affected by declining global milk powder and cheese markets. It saw “strong” performance in its butter products and high volumes and margin strength in Foodservice. In a statement, the company said, “Following 2014's record profit and volumes, the first quarter of 2015 showed a continued trend of strong volume and continued share growth in retail branded butter and superspreads.”
For the first quarter (ended March 31), Land O'Lakes reported quarterly net sales of $3.8 billion and net earnings attributable to Land O'Lakes of $99.4 million. It noted that while results were down compared to the same quarter a year ago (sales of $4.29 billion; net earnings of $124.7 million), the recent quarter “stands as one of the strongest first quarters for the company.”
"Overall profits saw a dip in comparison to 2014 first quarter results, primarily due to the cyclical nature of milk prices. This market volatility has had a substantial, negative impact on the first quarter inventory values and financial results," stated Chris Policinski, Land O'Lakes, Inc. President and CEO.
Business dynamics contributing to first quarter results included strong results in animal feed, which includes Purina Animal Nutrition. Pre-tax earnings increased significantly over the same quarter in 2014 due to volume growth and improved formula feed margins.
The crop inputs segment, which includes WinField Solutions, also reported strong performance for the quarter, with strong volumes in alfalfa and favorable seed margins. These effects were partially offset due to strong shipments in the fourth quarter of 2014.
See the complete results online. Click on "Investors" and "Quarterly Financial Statements" on the company’s website.
