Co-operative Entrepreneurship 2012 Jan Willem Straatsma Manager - PowerPoint PPT Presentation

Co-operative Entrepreneurship 2012 Jan Willem Straatsma Manager projects and sustainable dairy farming 27-02-2012

We provide people around the world with all the good things milk has to offer

Our milk By nature, milk is one of the richest sources of food. We process the PAUZE milk, supplied by our member dairy farmers, into a wide range of dairy products.

Our farmers We are a multinational dairy company wholly owned by Zuivelcoöperatie FrieslandCampina

Our co-operative base • 14,800 member farmers form one of the oldest dairy co-operatives in the world, the owners of FrieslandCampina. • Sustainable value creation for the members consists of milk price, capital payment and addition of members’ reserves on name.

14,800 member dairy farms

A young company in name, but we have a long history

Governance structure

Piet Boer Chairman of FrieslandCampina “I am expecting as a representative of our 20,000 member farmers – also shareholders – our company FrieslandCampina to deliver tangible results in three different areas:” Return on Investment 1. Continuity (we have a 140 yrs heritage) 2. Successfully embedding FrieslandCampina in the societies where we operate…. (stay aligned with stakeholders’ expectations)

The role of our co- operative Fully integrated Farmers are fully guided by their co- operative Entrepreneurial differentiation Opportunities for competitive dairy entrepreneurs Stay strong together Guarantee collective licence to produce Classic co-operative Collective Company valorisation Royal FrieslandCampina N.V. 10

Organisation

What we do

Our customers and consumers Consumers around the world Retail chains, wholesalers, local shops Professionals in the hotel, restaurant, café and bakery segments Food producers and pharmaceutical companies

Our world of brands Branches in: Belgium Germany France Greece Great Britain Hungary Italy The Netherlands Austria Romania Russia Spain Saudi Arabia United Arab Emirates Ghana Nigeria China Philippines Hong Kong Indonesia Malaysia Singapore Thailand Vietnam United States of America Worldwide Ingredients

Key figures in millions of euros 2010 2009 movement Results 8,972 8,160 Net revenue +10% 434 Operating profit 258 +68% 285 Profit 182 +57% Balance sheet 5,299 Total assets 4,770 2,071 Group equity 1,749 Ratios 10.0 Interest coverage ratio 6.2 0.9 Net debt / EBITDA 1.4 39.1% 36.7% Solvency

Key figures 2010 2009 movement Employees 19,484 20,034 Average number of FTEs -2.7% Member farmers 14,829 15,329 Member dairy farms -3.3% 20,375 Members 21,062 -3.3% Milk 8,821 Milk supplied by members 8,685 +1.6% Total payment milk member farmers 10,266 10,755 +4.5%

Our position 2010 dairy revenue, in billion Euro’s Company Dairy revenue 1. Nestlé -Switzerland 21,2 2. Danone - France 12,3 3. Fonterra - New Zealand 9,1 4. Lactatis - France 9,1 5. FrieslandCampina - Netherlands 8,8 6. Dean Foods - USA 8,3 7. Dairy Farmers of America - USA 7,4 8. Arla Foods - Denmark 6,9 9. Kraft Foods - USA 5,3 10. Unilever - Netherlands/UK 5,1 11. Saputo - Canada 4,3 12. Meiji Dairies - Japan 4,1 13. DMK - Germany 4,0 14. Sodiaal – France 4,0 15. Parmalat - Italy 3,9

Strategy route2020

Aspiration Help people move To be the most attractive dairy forward in life with company for member farmers natural dairy nutrition Our Value drivers strategy Branded Strongholds & IFT Basic Dairy-based Foodservice in Cheese geographic (B2B, B2C) products beverages Europe expansion Benefit platforms Health & Growth & Daily wellness development nutrition Functionality Growth and value- Capabilities Talent Milk Business model & creation Innovation management valorisation cost focus Foundation Goodness of Chain dairy advantages Sustainability The way we work

We need to generate profit and valorise member milk Profitability The objective of a business with no member milk is to generate profits above our EBIT hurdle The objective of our member milk intense businesses is to valorise milk at positive EBIT margins Member milk usage

Sustainability • Fundamental global need for healthy food • Milk is one of the most nutrient-rich foods • As a leading multinational dairy business, we aim to contribute to sustainable production • We want to show leadership in the field of Corporate Social Responsibility by means of: Health & Sustainable Development of Sustainable nutritional value value chains dairy farming dairy farming Tackling nutrient More efficient use Asia, Africa Sets the standard deficiency & of natural obesity resources

Global challenges ahead for dairy farming and processing sector Growing Volatile world energy population markets Need for Food security sustainable & food energy inflation Obesity & Scarcity in malnutrition natural Sustainability resources Nature and Global biodiversity at warming risk

Key sustainability issues at the farm Renewable CO 2 energy 20% of cows never outside Methane Methane Sustainable feed Ammonia (soy usage) Energy and climate Cow is key 25% claw 25% udder Phosphate problems problems Biodiversity and Nitrogen The most pressing sustainability issue on the dairy farm are: Impact on 1) green house gas emissions 2) animal welfare 3) sustainable water quality soy, 4) mineral balance (manure) 5) ammonia 23

Responsible Dairy Farming 5 modules -140 meetings with 6,000 farmers -Pilot projects started mid 2011 - Action plan ready & agreed by member farmers end of 2011 Nature conservation, landscape (protect biodiversity) Health & Welfare dairy cows Energy & Climate Phosphate (Minerals) Cows in the meadow

Open farm days: a pleasant way to show our transparency • Hundreds of thousands of Dutch consumers are having a day out at our dairy farms annually • Picknick, guided farm tours, cuddle corner with calves, dairy product taste sessions, children festivities and events, education about farm life and nature conservation • Supported by our Campina dairy brand

This is what sustainable dairy farming brings Larger access in the international dairy market Improved Maintaining appreciation sustainability of the dairy farms Economically powerful dairy farms 26

Royal FrieslandCampina