Higher prices for dairy products and the lower Australian dollar have enabled Warrnambool Cheese and Butter Factory (WCB) to upgrade its profit guidance.

The company still expects its annual profit for the 2012/13 financial year to be lower than in the prior year, but the result is likely to be an improvement on the guidance that the company provided in April.

WCB said on Tuesday that it now expects that its 2013 net profit will be about 52 per cent below that of last year.

In April, WCB had expected that its 2013 net profit was likely to fall by at least 80 per cent as a result of subdued international commodity prices, the high Australian dollar and ongoing competition for milk.

“The recent improvement in trading conditions and overall business performance have provided a welcome lift in 2013 full year profits, and we expect the continuation of these factors will contribute to improved earnings in 2014,” WCB chief executive David Lord said in a statement.

International dairy prices rose to record highs in the fourth quarter of the 2012/13 financial year.

Prices had since softened, but were still much stronger than the 2013 average.

The Australian dollar had also depreciated against other currencies.

WCB had also benefited from improvements to its business and a switch to making products that were more profitable.

Shares in WCB were two cents higher at $4.49 at 1119 AEST on Tuesday.