Ornua to build on ‘solid performance’ for 2026

Despite a ‘complex’ year, the Irish dairy co-operative put in a ‘solid performance’, said Conor. “We managed to grow our turnover by nearly 2 per cent, and grow profits by nearly 5 per cent. Operating profit is up to €136m and our payments out to members, the Ornua value payment for the 12 months, was €74m, which was up 14 per cent. There were really two different halves to the year but, nonetheless, Ornua still delivered value for Irish dairy.”
Especially impressive was the fact that revenues increased by 1.6 per cent while profit increased by 4.7 per cent, as Conor noted: “A lot of that was delivered by growing our margin and growing innovation in the business, and really driving value out of grass-fed dairy, making sure we are finding the markets that can pay a premium consistently. Those markets and consumers are also willing to take new products and buy into the brand. Because of that, we were able to increase the value payment back to producers.”

Ornua’s geographic spread

Headquartered in Dublin, Ornua has a strong global team of 2,800 employees, operating from 10 business units worldwide, and 13 production facilities. It is, truly, a global company. “We have a number of important markets for the Kerrygold brand, with Ornua operating in the four corners of the globe,” said Conor. “Our most important markets in terms of sales include the US, Germany and the UK. Naturally, the Irish market remains very important to us as well. In addition, we have a very strong ingredients business in the US, Europe, in the Middle East and Africa. Ornua’s global reach allows us to trade through tough times and to still get the value back into Irish dairy.”

Debt up

Despite the significant increase in Ornua’s debt levels, Conor was not perturbed, as he explained it is a working capital figure, driven by inventory and by the stock purchased from its members. “It does ebb and flow," he said. "I’m not concerned about the debt number rising because we’re here to buy and hold inventories and sell them in a manner that brings stability to the market. Those numbers have come down significantly in the first three months of 2026. There’s no issue with the funding of the business; we’re well-funded. The debt being high at the end of the year was our way of supporting and fulfilling our remit and making sure that we are holding the right products to sell in future. We’re also doing that on behalf of our members. We have very well-run member co-ops that sell us products that we, in turn, sell in the international markets. We have long-established working capital facilities which our members avail of. I’m not concerned. This is what Ornua does and what we’ll continue to do.”
When asked about the travails of North Cork Creameries, Conor replied: “North Cork has been on a well-publicised journey. They’re a member of Ornua and we will continue to trade with them. We will also be respectful of what members might like to do in the future. Until otherwise advised, North Cork remains a very valued member.”

The missing co-op

Commenting on the fact that Kerry Dairy Ireland is not a member co-op, he said: “We do have a relationship with Kerry Dairy Ireland, and I think that will continue. We’ll make sure that the channels are always open. I think Kerry Dairy Ireland have developed a very clear strategy since becoming independent of Kerry Group. We’ll continue to talk to them and if there’s anything we can do together in the future that makes sense for the dairy farmer, I’d be very open to that.”

Catching the cream

Ornua’s Kerrygold brand has hit €1bn in revenues, so where does a brand go and grow from here? “The €1 billion mark is a very strong foundation to grow from. It gives us the scale in the US, for instance, to launch new products and to sell to new consumers," Conor explained. "Consumer recognition is high, and there’s a willingness to pay a premium, whether that’s for butter, cheese or newer branded products including cream cheese and flavoured butters. Cream cheese is an important addition to Kerrygold in the last couple of years, not least because it’s a clean label product. It doesn’t have any stabilisers or other added ingredients except dairy and some culture. There is enormous potential for cream cheese. Consumers are looking for difference in what they purchase. They are looking for natural products. Kerrygold can fulfil those needs. We continue to expand our distribution of cream cheese, and we will launch it in more markets in the next 12 months.”

Producer price challenged

Conor acknowledged the price pressures that Irish milk producers are under: “There’s been a big downturn in farm gate prices, reflective of international dairy markets since late last year. There’s a lot of volatility even in the futures markets, and that is a challenge because, depending on what day or what week you look at, the outlook has changed. It’s fair to say that prices probably couldn’t drop any further. Markets have stopped sliding and have stabilised at a level which at least gives some certainty to what returns will be like up to June. We’d all like to see markets come up, putting some margin back in milk production. It’s likely that it will happen in the second half of 2026.
“But the challenge right now is the uncertainty around the forecasts. A lot happens in a week. Six weeks ago, I would have been talking about prices for the second half being a lot higher than are forecast now. We’d still be hopeful with the fundamentals that are out there, particularly on the demand side, where’s there’s still significant demand. If we can right size supply, there’s still significant value in the markets for the future."

Ornua growth plan

The Ornua co-op has embarked on a strategic growth plan to 2030, as described by the Ornua CEO: “It’s all about transforming for growth, scale and efficiency. We’re looking at growing our branded sales even further so that we can drive margins in the business and ultimately improve the returns to farmers. We will do that by having commercial and operational excellence. We will increase our focus on the consumer, whose needs are changing. They want more experiences. They want to be spoken to on social media. They want to interact with the brand. The strategy is all around changing the way we operate, to support the new world that we have to operate in.
“One target is to have €3 billion of branded sales in the next five years, which would be a significant increase. We’ll do that through innovation and through creating new products like the cream cheese that we’ve spoken about and by recruiting new consumers.”

Market opportunities

Do the Mercosur and India trade deals offer opportunities for Ornua? “They’re probably more medium to long term," he said. "We must recognise that in the markets that we sell Kerrygold, we need to be able to command a premium to justify the product going into new markets. We have some seed markets, which we’re currently looking to develop in the next couple of years. We do need to have patience and recognise that the investment the dairy industry and dairy farmers have made in Kerrygold over the last 60 years is paying the return. These things don’t happen overnight for those large regions that you’ve described, and there’s certainly an ambition for us to expand beyond where we are today.”

Greater cooperation

Conor said Ornua is positively disposed to further co-operation in the Irish dairy sector: “I think there is always room for encouraging co-operation and efficiency. We have an industry which is well invested in. We have dairy farmers who are ambitious and we have great products. We always need to be careful that we’re not either driving waste or removing value from the system with the current structures. I think with the existing structures, we can get the maximum value out of Irish dairy. But we always need to be cognisant that the consumer and the affordability of our products are at the front of our minds. Any inefficiencies in the system are likely to lead to a cost challenge for the consumer and that is not good. Where we can encourage cooperation and efficiency in the supply chain, we should do so.”

Room for volume growth

Milk production peaked on Irish farms last year. Is there scope to sell more dairy produce?
“We can handle increased output, particularly on the branded side with the ambition we have for the Kerrygold brand. If there is more output, our role is to find markets to support that in a sustainable and profitable way. Last year demonstrated that with the right weather and economic conditions, we have a herd and a cohort of farmers that are well capable of producing high quality product in greater volumes. Ornua is here to support milk producers in their needs and ambitions. If the ambition is for them to continue growing, we’ll grow with them.”

2026 outlook

The Ornua CEO is naturally cautious about the remainder of 2026: “We’d like to match last year’s performance. Dairy markets are very volatile and a lot of the performance, particularly on the turnover line is driven by what the dairy markets can return. It appears that in the second half of the year, there will be a lift in the value of dairy markets. Ornua has had a reasonable start to 2026 so that’s positive. But the challenges now appear weekly and monthly that used to appear annually. So, we need to be agile and responsive. We also need to be very close to our members to make sure that we’re aware of their challenges and their needs so that we can respond to them as well.”