More acquisitions will be required at Muller to meet ambitious plans to become a £9 billion company in four years.
Andrew McInnes, managing director of the new-look Muller Milk and Ingredients following the takeover of Dairy Crest’s liquid business, said the firm would now be maintaining ’significant losses’ in the short-term due to the unprofitable dairies.
"We fully expect to turn that around and build a profitable business," he said. "I want us to be the buyer of choice for farmers and also the supplier of choice for retailers."
He said the company’s strategy was to diversify and manage its portfolio.
Mr McInnes added: "Our vision is to get to £9bn turnover by 2020. We got to £5bn by the end of last year. To get to £9bn we will have to acquire more businesses but also grow organically."
He spoke about how the Dairy Crest acquisition was the most frustrating of his career due to competition law making discussions between the two companies difficult.
The UK dairy sector must become more competitive to take a greater share of its own market.
This was another message from David Dobbin, of United Dairy Farmers, during his speech. He said the UK needed to be as competitive about import substitution as it was about exports to take advantages of the large volumes which could be displaced on the home market.
"People are peddling it as a free ride. I think there is a big opportunity but I think we are going to have to go about it realistically," he said.
"While younger generation dairy consumption will go up, it is nothing like what we consumed at that age," he added. "There is a demographic timebomb which will take away demand in our dairy market."