First Milk has announced that member milk prices will increase by 0.52ppl from November 1 on a manufacturing standard litre of 4.2 per cent butterfat and 3.4 per cent protein.

Commenting on the announcement, Nigel Evans, vice-chairman and farmer director, said: “The returns from the milk market continue to strengthen and this, along with advances in the performance of the business, mean that we can deliver this additional milk price increase to our members, which will be welcome news.

"Looking to the future, we remain focused on driving efficiency and quality, generating value through strong, long-term customer partnerships to deliver competitive returns back to our members.”

First Milk, which has a creamery at Haverfordwest, has also published its annual results for the year ending March 31, showing solid trading performance from a transformed business, delivering a net profit for the period of £6.0m.

The financial highlights were:

* Operating profit (before exceptional items) was £11.7m (2016: £6.0m)

* Net profit for the year was £6.0m (2016: loss £5.1m)

* Group turnover was £206.5m (2016: £294.2m)

* Net bank borrowings increased to £37.6m (2016: £32.1m)

* Capital investment of £3.8m across all our sites in the year (2016: £4.8m)

* Total group capital and reserves increased to £22.0m (2016: £17.4m)

* 9ppl average increase in member milk price (including payment of 2ppl business performance supplement)

First Milk chairman, Clive Sharpe, commented: “Over the last two years, First Milk has transformed. We have put in place a new business strategy, divested loss-making subsidiaries, improved our operational performance and implemented an effective co-operative governance structure.

“The transformation of our business is complete and, as a result, First Milk today is now a more focused and financially secure business. This is demonstrated through these significantly improved financial results and, most importantly, through our ability to increase milk prices to our farmer members ahead of the market during the last financial year.”