Multinational cooperative Arla Foods has generated revenue worth €13.8 billion in its financial year 2024, registering an increase of €401 million compared to 2023.
Arla added that its performance price increased to 50.9 euro-cent/kg, marking the second-highest level in its history and reflecting strong market demand and effective cost management.
The cooperative has proposed a supplementary payment of 2.2 euro-cent/kg milk delivered, which is the 'highest dividend' paid to the farmer-owners in the company’s history, according to the company.
Jan Toft Nørgaard, chair of Arla Foods, stated, ”Arla's strong results in 2024 are a testament to the dedication and skill of our farmer-owners and employees.
”Our competitive milk price and financial performance reflect our ability to navigate a complex market landscape effectively and deliver value to our stakeholders.”
Divisional Performance
In 2024, Arla's European segment reported a revenue increase of 1.0% to €8.1 billion, driven by a 4.1% branded volume growth.
The company attributed this growth to increased consumer purchasing power due to easing inflation and rising wages, as well as the positioning of branded products and strategic growth efforts implemented by the company.
The company saw strong branded volume growth in the Netherlands/Belgium and France cluster (7.4%) and the UK (7.6%).
Key performers in the category included Arla Protein, Arla Pro, and Lurpak, with respective growth rates of 32.3%, 8.7%, and 6.7%.
The UK business saw a slight decrease of 0.2% to €3.1 billion, while Arla Sweden posted revenue growth of 3.6% to €1.6 billion.
In comparison, Denmark reported a decrease of 1.3 % to €1.2 billion despite stable branded volumes.
Revenue at Arla's international fell 1.5% during the year to €2.4 billion, primarily due to unfavourable currency developments in Nigeria and Bangladesh.
The company's underlying revenue development was positive, and the segment achieved branded volume growth of 2.9%.
Elsewhere, Arla Foods Ingredients (AFI) saw revenue growth of 5.4% to €1 billion, driven by robust demand for specialised proteins and 2.5% growth in the value-add segment.
The company's Global Industry Sales experienced a revenue decline of 0.1%, driven by higher commodity prices amidst strong demand and constrained dairy supply.
European and global dairy markets saw significant price increases, particularly in fat-heavy products like butter and yellow cheese, with the former rising by 40% during the year, Arla added.
Outlook 2025
Arla expects geopolitical turbulence to persist in 2025 and the company aims to leverage its cooperative strength and local food production capabilities to navigate the situation.
It also expects dairy demand to be influenced by consumer reactions to higher dairy prices and ongoing geopolitical uncertainties.
The food giant has forecast 2025 revenue to range between €14.5-15.3 billion, with profit share within the target of 2.8% to 3.2%.
It also anticipates pressure on branded volume-driven revenue growth due to pricing and consumer uncertainty.
Peder Tuborgh, CEO of Arla Foods, added, ”Our commitment to resilience and adaptability remains unwavering. By harnessing the strength of our cooperative model and focusing on sustainable practices, we are well-positioned to navigate the uncertainties ahead and continue delivering value to our farmer-owners and customers.”
