The UK’s largest dairy processor Dairy Crest has made a full-year net loss after incurring impairment charges at its dairies business.

For the 12 months to the end of March, Dairy Crest made a pre-tax loss of GBP10.1m (US$5.8m) compared to a profit of GBP77.8m last year, the company reported today (24 May).

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Exceptional non-cash impairment charges in its dairies division of GBP81.7m led to the reported loss, the group said.

Cash generated from operations fell 34% to GBP84.5m, while net sales edged up 2% to GBP1.63bn.

Sales of its five key brands were up 11% and included “record” market shares for Cathedral City and St Hubert in the fourth quarter, the firm said.

“Dairy Crest’s results for the year demonstrate the continued benefit of being a broadly based business,” said chief executive Mark Allen. “Double digit growth in our branded spreads and cheese businesses has offset unsatisfactory results in dairies.”

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Going forward, Allen said the company will continue to take “decisive strategic action” and “proactively” shape Dairy Crest for the long-term.

“In March 2012 we announced a strategic review of our French spreads business, St Hubert, which is progressing and since the year end we have also announced a series of actions to restore our dairies business to a satisfactory level of profitability in the medium term,” he added.

Click here to view the full earnings release. Click here for a flavour of the City’s verdict on the results and click here for our On the money coverage of the company’s conference call.