LOSSES at Artigarvan processor TMC Diaries mounted last year mounted to £5.4 million after a world-wide slump in milk prices.
The company - now part of the LacPatrick Group - makes milk powder for export mainly to the Middle East, Africa and Asia.
The firm, which processes 1 million litres of milk a day, had lost £1.8m in 2014.
The performance in 2015 included the writing off £2.3m of goodwill previously recognised on the acquisition of the original Artigarvan milk processing business.
Meanwhile, turnover was down 21 per cent to £100m in 2015.
Directors said the decline was "due principally to a world-wide slump in milk and milk powder prices".
"This fall in turnover had a pro-rata effect on gross margin which fell by £2m (18 per cent) despite an increase in gross margin percentage, from 89 per cent in 2014 to 9.3 per cent in 2015," they added.
TMC became part of the LacPatrick Dairy Group in August last year along with Ballyrashane Dairies.
The firm, which employs more than 50 people, is undertaking a major £30m expansion of the Artigarvan plant that will more than double its processing capacity.
It is expected building work will be complete early next year.
The plant formerly operated under the Town of Monaghan name and has been in existence there since 1902.
Directors added: "The LacPatrick Group management anticipates that it will further integrate the Artigarvan and Ballyrashane business in 2016 and 2017.
"The company continues to incur significant expenditure on research and development to design and implement new and improved milk powder products, and expects this R&D activity to increase with the increase in capacity currently under way at its Artigarvan site."
When Ballyrashane and TMC merged last year to form LacPatrick Co-operative, it was described as a "game changer" for the Irish dairy sector.
The cross-border co-op has more than 1,000 farmers delivering 560m litres of milk annually.
At the time, the company's chief executive Gabriel D'Arcy said the amalgamation of the two enterprises heralded a "powerful new force".
"We now have the scale and ambition to win in what is currently a very challenging and competitive marketplace," he said.
"Given the volatility of global dairy markets, this merger further underlines the importance and significance of this ambitious move by our two companies."
