Half-year results revealed that the firm was DKK100m (£9.1m) below budget at DKK238m (£21.6m).
The company, which owns the Cravendale milk and Lurpak butter brands, was affected when consumers in the Middle East began boycotting Danish brands in February, following a Danish newspaper's publication of cartoons of the Prophet Mohammed.
Arla admits that consumers in Saudi Arabia, which accounts for about two-thirds of the firm's income, are still refusing to buy its products.
However, sales have recovered in most other Gulf States.
This article was first published on Marketing