Butter Hoarding Boosts Profit of Maker of Lurpak

(Bloomberg) -- Arla Foods amba, one of Europe’s top milk producers, reported a 34% jump in profit in the first half of the year as consumers stockpiled products including butter in the midst of the Covid-19 crisis.

The pandemic sparked increased dairy consumption in homes, which helped offset declines in the food service sector, according to Arla’s chief executive officer, Peder Tuborgh. For example, in the U.K., demand for the company’s Lurpak butter brand jumped more than 20%.

“We can see that today, consumers probably reverted back to well-known brands which they could safely buy,” Tuborgh said in an interview. “Luckily we have several of those.”

The Viby, Denmark-based farm cooperative earlier on Thursday reported first-half net income rose to 163 million euros ($192 million).

Here are some highlights from the earnings report:

• Sales in the first half of the year rose 3% to 5.38 billion euros.
• Arla maintained its 2020 sales forecast of 10.4 billion euros to 10.8 billion euros.
• Tuborgh said the pandemic and any potential fallout from post-Brexit talks between the U.K. and European Union are two “severe and unpredictable risks” for the second half.

©2020 Bloomberg L.P.