Dairy Crest maintains momentum as the cold snap sees demand rise

The group's improved guidance for the nine months to the end of

December reflected a "strong performance" in the final quarter of 2009, helped by a further increase in sales of milk to supermarkets.

Since then it has benefited from the recent cold snap as increased demand caused a 17 per cent spike in milk volumes in the first week of January.

Total sales were 1 per cent lower in the nine months to December 31, reflecting lower sales of commodity ingredients and milk to non-major retail customers.

Its five key brands of Cathedral City, Country Life, St Hubert Omega 3, Clover and Frijj were supported by high levels of television advertising and promotions, helping sales of the brands to rise by 10 per cent against a year earlier.

"Looking forward, we intend to continue to advertise, innovate and promote our key brands in order to maintain their impressive momentum," Dairy Crest said.

The company's promotional drive, which has included the 'Great British Butter' adverts featuring former Sex Pistol John Lydon, recently helped to make Country Life the UK's fastest growing butter brand.

Dairy Crest added yesterday that 180,000 customers were now registered to its milk&more internet delivery service, which it will continue to market in the current quarter.

And buoyed by the recent renewal of a fresh milk contract with Sainsbury's, the company announced plans for 75m of investment in its liquid milk dairies over the next three years.

Chief executive Mark Allen said this would allow the company to drive "further cost efficiencies, remain competitive and maintain high levels of service to our customers".

Investment in the past 18 months has been focused on the cheese business after the opening of a new packing plant at Nuneaton provided the company with a "world-class" supply chain to support its Cathedral City brand.