Milk Link to make first processing payment

Milk Link has announced that it is to make its first processing payment to its Members. The amount available for payment will be at least £2 million and will be made by way of an Interest Payment on the value of Qualifying Loan rights held by Members. For a typical Milk Link Member holding the average number of Qualifying Loan rights this will mean they will receive a minimum cash payment of just over £1,000. This will be in addition to the £1.5 million of interest payable on all Member Capital Account balances for 2006/07.

The final amount available for distribution will be determined by the Milk Link Board at the end of May once its 2006/07 Group results are known and this will be paid to Qualifying Loan holders as soon as possible thereafter.

This is the first time that Milk Link has been in a position to make a specific payment to Members from the returns of its processing investments. It is an important step in demonstrating that the investment made by Milk Link Members is starting to be rewarded. A key factor in enabling the payment was the recent acquisition of Glanbia plc's minority share holding in The Cheese Company which allows part of The Cheese Company's profits to flow through to Milk Link Members.

Commenting on the payment Ronnie Bell, Milk Link's Chairman said, "Today's announcement is a positive development for Milk Link. It confirms, I believe, that the delivery of our strategy is on track, reflects our greater financial strength and the increased confidence of our banks. It follows on from our £5.7 million repayment of Capital Proceed Loan Notes last August; the issuing and first successful trading of Qualifying Loan Certificates; the increase in the B percentage milk price; and our acquiring full control of the UK's largest cheese manufacturer."