2023 Chairman's Report to Members

It is with great pleasure that I as Chairman present to you the annual report for 2023 in what was a momentous year for the Society.

8 May 2024

The year marked a significant milestone in our journey as we celebrated the centenary of our establishment. Over the past one hundred years, Drinagh has evolved, adapted, and thrived, thanks to the dedication of our staff, the support of our shareholders, the commitment of our milk suppliers and the trust of our valued customers. The Society was founded specifically for the manufacture and sale of butter and has evolved into a large multi-purpose co-operative that continues to support and serve the community.

Over 3,000 people attended the open weekend in late July where the exhibition of photographs and memorabilia from the first one hundred years were the main attractions. Visitors also had an opportunity to get a guided tour of our state-of-the-art feed mill.

In November, a book, Drinagh 1923-2023 100 Years of Drinagh Co-Operative Limited by Philip O’Regan was launched. The book tells the remarkable story of Drinagh Co-Op from its inception in 1923.

A number of events were held on the 13thNovember 2023, the official date that marked the centenary, including a tree planting ceremony to commemorate the first Board of the Society.

The centenary celebrations provided us with a unique opportunity to reflect on our rich heritage, celebrate our achievements, and reaffirm our vision for the future. The festivities brought together employees, shareholders, customers, and members of the community, fostering a sense of camaraderie and pride in our shared accomplishments.

In a challenging year for dairy markets where prices fell sharply, 2023 proved to be another very successful year for the Society’s trading results. Overall turnover was back €49M on 2022 or 20.6% with price being the dominant driver rather than volume. Milk volume was down 3%, but sales value was down 27.2%; mill volume was up 1%, but sales value was the same, and fertilizer volume was down 33%, but sales value was down 51%; other sales through the branches were similar to 2022 while pharmacy sales were up 11%. Operating profit before trade bonuses fell €1.1M or 14% with the combined effect of a drop in creamery and stores margins plus labour inflation outweighing the combined effect of a strong mill margin, additional pharmacy sales and reduced energy costs. In light of these results, the Board was pleased to be able to approve trade bonuses totalling €3.2M at year end.

Carbery’s results reflect a dairy market exposed to commodity price fluctuations, a strong performance in its taste division and continued development of existing and new customers in its nutrition and cheese division. Group turnover was down 12% on 2022 and operating profit was lower by 26%. Carbery was able to draw on the €19.9M set aside in the stability fund in prior years to support the milk price in 2023.

The performance of our investment portfolio contributed very positively to 2023 group profit with equity markets trending upwards after significant uncertainty in 2022. With the Drinlis property becoming vacant in 2022, a new tenant, Regus, specialising in offering short term and long-term workspace solutions, rented the top floor in September of 2023, offering significant potential into the future. Shinagh Estates continues to contribute positively to group profit.

Milk supply for the year decreased by 6.6 million litres to just over 212 million litres. 2023 will go down as a challenging year. Supply was flat for the period from January to September however a wet back end weatherwise had a significant negative effect on milk supply from October onwards.

2023 marked the first full year of the Future Proof programme which offered suppliers the opportunity to benefit of a bonus of up to 1.0 cent per litre for completing four key sustainability measures. Suppliers showed their continued commitment to improve sustainability at farm level and over 89% of the milk pool benefitted from the Future Proof bonus.

The renewal of the country’s nitrates derogation is imperative for the sustainable future of our dairy sector. With the majority of the country now farming at 220kgN/ha, a further reduction to 170kgN/ha would have a detrimental effect on many of our milk suppliers as well as the rural community.

The Society congratulates Oliver and Sheila Lynch, Coolnaclehy, Skibbereen who were the Drinagh winners at the Carbery Milk Quality and Sustainability Awards. Congratulations also to Ian and Marie Kingston, Sillertane, Dunmanway who as well as hosting a very successful Carbery Milk Quality farm walk, were also finalists at the NDC and Kerrygold Quality Milk Awards during the year.

The Board approved a bonus of 1.0 cent per litre on 2023 milk supplies at year end. The average price paid on 2023 milk supplies was 44.22 cents per litre after levies and charges and before VAT (46.43 cents per litre including VAT).

Throughput in the mill was up marginally to just over 85,000 tonnes. Falling raw material and energy costs resulted in feed prices reducing gradually throughout the year. The completion of a 726 kw solar photovoltaic system on the roof of the Central Hardware contributed to the reduced energy costs. The system will make the mill’s operation more sustainable and reduce its carbon footprint. Feed bonuses similar to the previous year were approved by the Board at year end to reward our loyal customers.

The Society acquired the business of Scannell’s Pharmacy, Ballineen during the year. It began trading under the Drinagh umbrella on the 1st September 2023. We welcome the staff to the Drinagh family and look forward to their contribution to the Society. The pharmacy has been integrated into the Drinagh business and will strengthen the Society’s position in the pharmacy sector.

I wish to pay tribute to our friend, colleague and fellow Board member, Mr. Joe Burke RIP who passed away after a short illness at the end of December. Joe was a valued member of the Board who fought tirelessly on behalf of his shareholders. Joe made a huge contribution to the Society during his eighteen months in office. On behalf of the Board I offer our deepest sympathies to his wife Anne, to his children, Danielle and James and to his extended family. May he rest in peace..

A sincere thank you to my fellow Board members for their continued dedication to their roles. A special word of thanks to the three retiring Board members, Mr. Raymond Collins, Mr. William Collins and Mr. Derry Scannell, for their outstanding service to the Society. I welcome Mr. Derry Connolly and Mr. Flor Cal McCarthy, Mr. Donal O’Connor to the Board and wish them well in their terms in office.

Finally I want to thank our shareholders, milk suppliers, customers, staff and management for their continued commitment to the Society.

Donal McCarthy


Drinagh Annual Report 2023
Drinagh Annual Report 2022
Drinagh Annual Report 2021
Drinagh Annual Report 2020
Drinagh Annual Report 2019
Drinagh Annual Report 2018
Drinagh Annual Report 2017
Drinagh Annual Report 2016
Drinagh Annual Report 2015
Drinagh Annual Report 2014
Drinagh Annual Report 2013
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