The company, which is taking over the Midland Co-op milk plant in Birmingham, saw its adjusted full-year pretax profits fall by one per cent to £ 84.2 million in the 12 months to 31 March.
Drummond Hall, chief executive of the company, said he expected earnings to fall again in the current year in tough market conditions.
Dairy Crest is regrouping after losing milk supply contracts with Tesco and Asda. To strengthen its market position it has bought Midland Co-ops milk operations for £20 million cash and has also acquired Starcross Foods, a Derbyshire dairy business, for £16.9 million.
The Birmingham dairy is expected to close in due course with the loss of more than 200 jobs, although some employees may be offered the chance to move to Derbyshire.
The group used the release of its annual figures yesterday as an opportunity to trumpet the benefits of its new St Ivelbranded milk with omega-3, which many doctors believe improves concentration and learning in children as well as being good for the heart.
It comes as the group carves out a stronger position in the market for "functional and healthy foods" through the launch of products such as Gold Lowest, which it claims to be the lowest-fat branded spread in the UK.
Turnover fell by one per cent to £1.35 billion last year, but the group said trading over the past eight weeks has been in line with its expectations.
In addition to processing milk, Dairy Crest makes spreads such as Utterly Butterly, St Ivel Gold and Country Life. It also owns the Cathedral City cheese brand and Yoplait yoghurts.
Dairy Crest said its spreads business had become more profitable during the year despite price cutting among retailers which limited the opportunities for its own promotions.
The value of sales of Clover and Utterly Butterly rose by two per cent and one per cent respectively, while Country Life packet butter enjoyed a 26 per cent uplift in sales.