more information: www.annualreport-cosun.com Annual Report
www.cosun.com Cosun Annual Report 2009
Annual Report 2009 This Annual Report is an English translation of the original Dutch publication. In the event of textual inconsistencies between the English and the Dutch versions, the latter shall prevail. This Annual Report is also available on the internet: www.annualreport-cosun.com. Royal Cosun Cosunpark 1 P. O. Box 3411 NL-4800 MG BREDA Telephone +31 (0)76 530 33 22 Fax +31 (0)76 530 33 03 Internet www.cosun.com E-mail infocosun@cosun.com Entered in the Trade Register of the Chamber of Commerce for the Southwest Netherlands under number 20028699. Cosun Annual Report 2009
Contents Profile 3 Key figures 4 Strategic framework 5 Report of the Board and the Executive Board Letter from the Chairman and the CEO 6 Financial performance 8 Prospects 9 Cooperation works 10 Operations Suiker Unie 13 Sensus 14 Nedalco 15 Aviko 16 SVZ 17 Unifine Food & Bake Ingredients 18 Annual Accounts 2009 Consolidated balance sheet 28 Consolidated profit and loss account 29 Consolidated cash flow statement 30 Notes to the consolidated annual accounts 31 Cooperative balance sheet 49 Cooperative profit and loss account 50 Notes to the cooperative annual accounts 51 Other information Auditor s report 60 Provisions in the Articles of Association governing the appropriation of profit 61 Proposed profit appropriation 61 Post-balance sheet events 61 Addresses 62 Risks and risk management 19 Cooperative issues 22 Members and shares per district 24 Members of the Board, Supervisory Board, Executive Board and Central Works Council 25 Report of the Supervisory Board 26 2 Contents / Cosun Annual Report 2009
Profile The value(s) of Cosun Cosun is a cooperative that protects its members interests by extracting the maximum value from agricultural produce such as sugar beet, potatoes, chicory roots, vegetables and fruit. We are specialists in the large-scale production processes necessary to convert these raw materials efficiently into countless products for use in all kinds of applications: sugar for the food industry, retailers and the foodservice channel; potato specialities for the foodservice channel and for consumers through supermarket chains; inulin to add dietary fibres to foodstuffs; fruit products for use in desserts, ice cream and fruit juices. We also produce alcohol for the drinks sector and for nonfood applications (pharmaceuticals and fuel) and ingredients for the fine bakery industry. Foodstuffs are not the only things we make. By-products from sugar production have traditionally been used as an animal feed (beet pulp) and in alcohol distillation (molasses). More recently, we have started providing ingredients for non-food products such as starch derivatives for use in, for example, wallpaper paste. In pursuit of sustainability Cosun s ambition is to be a sustainable producer. We extract all we can from the raw materials that are supplied to us and develop new applications specifically for what we used to look upon as waste or residual products. In pursuit of our ambition, process technology and product development often go hand in hand. Our logistics and production processes are organised as efficiently as possible in order to prevent waste. This is good for the environment, good for profits and good for the professional pride of our people. At the heart of society Cosun is at the heart of society. We operate in an arena with many different players, each with its own interests. Our staff form our human capital and are together responsible for our results. We also recognise the interests of our customers and their customers, down to the final consumer. And we do not forget our suppliers, contract partners and others with whom we work, the residents living near our production sites, regulators, administrators, opinion leaders and countless organisations that promote a wide range of interests. Cooperative Cosun is a cooperative owned by its members, Dutch sugar beet growers who hold shares in the business. Our task is to process their sugar beet into valuable products and to pay them an attractive price for their beet. Cosun Annual Report 2009 / Profile 3
Key figures As a cooperative of Dutch sugar beet growers, Cosun pays its members a price for their beet that is based in part on the profits earned on processing beet into sugar and by-products and on selling the sugar and by-products. The beet price is recognised in full in cost of raw materials and consumables in the profit and loss account and therefore influences the operating profit and the result for the year presented in the table below. in EUR million 2009 2008 2007 2006 2005 Net turnover 1,758 1,689 1,713 1,469 1,339 Operating profit 93 86 100 111 53 Operating profit before amortisation of goodwill and incidental items* 101 70 115 72 61 Net result 59 41 56 66 24 Cash flow from operating activities 225 114 117 178 10 Depreciation of tangible fixed assets 75 74 68 55 51 Capital expenditure on tangible fixed assets 45 67 100 95 90 Capital and reserves** 732 701 686 613 552 Group equity** 753 724 705 631 567 Group equity as a percentage of total assets 48 43 40 45 45 Total assets 1,565 1,669 1,750 1,391 1,265 Average number of employees in FTEs 4,443 4,266 4,337 4,210 4,194 Sugar beet price*** 43.00 39.44 41.31 49.05 51.72 Distribution on shares**** 2.25 0.25 6.00 - - Sugar beet purchases from members 231 221 217 173 177 * Incidental items consist of impairments in the value of fixed assets, reorganisation provisions, restructuring aid and gains on the sale of participating interests and tangible fixed assets. ** In accordance with Annual Reporting Guideline 620, the figures for 2008 have been restated. *** Price in EUR per tonne of beet with average sugar content and average extractability. **** Amount in EUR per tonne of quota beet, paid on shares entitled to distributions from other activities. 4 Key figures / Cosun Annual Report 2009
Strategic framework The strategic framework expresses our goals and policy principles. The cooperative s object of promoting its members material interests is achieved in practice through our complete dedication and commitment to processing agricultural produce. One of our core aims is to safeguard profitable beet farming in the Netherlands. The main principles defining our strategy and corporate policy are rooted in the social responsibility we bear. In more concrete terms, they lie not only in a healthy financial return but also in our responsibility for the social and physical environment. Of prime importance are our staff, whom we offer a good and challenging working environment, and other interested parties such as the people who live near our factories, our suppliers and customers. We also have a specific responsibility for the physical environment in which we operate. This is reflected in the care we take with our raw materials (agricultural products but also energy, water and other consumables) and in the measures we take to minimise inconvenience, for example in the form of discharges and emissions from our operations. In addition to making commodities, we develop and sell products with added value such as potato specialities, baked goods and ice cream concepts, and functional ingredients such as inulin. Cooperation in the supply chain, with both suppliers and, especially, customers, is of critical importance. Emphasis has traditionally been placed on foodstuffs but promising openings are also arising in other areas such as green energy (biogas) and products/chemicals based on vegetable materials (the bio-based economy). Although these market segments are still relatively modest in scale, they are developing strongly. The strategic focus on extracting the maximum value from agricultural raw materials is harnessed in many ways. We must achieve the highest return on the products at the lowest cost and make optimal use of energy, water and other consumables because many of our products are commodities in nature. Making use of all the raw material, to produce both the primary product and secondary products, is increasingly a decisive factor in our commercial success. Cosun Annual Report 2009 / Strategic framework 5
Report of the Board and the Exe We want to contribute to sustainability. Robert Smith President & CEO Letter from the chairman and the ceo The economic recession that followed the financial crisis was keenly felt in 2009 and the agricultural and food industries were not spared the consequences. We had already taken certain measure at the end of 2008, such as reducing stocks, implementing efficiency improvements and cutting costs. With the help of creative solutions, we reined in our investments and anticipated our customers needs to offer the right product in the right way. Although we had a turbulent year, our prompt response meant it was anything but disappointing. On a modest 4% increase in turnover, we achieved a 9% increase in operating profit. Opportunities in a time of recession Waiting for the global economic crisis to subside and then taking stock of the damage is not an option for Cosun. Our vision is to invest in the future now and to make an even greater contribution to sustainability. We are already making progress on many fronts. Our investments in crop-growing techniques and cooperation in the supply chain are paying dividends in the form of higher yields per hectare. We are also investing in the development of new applications using residual products and waste. Biogas production, for example, is reducing the use of fossil fuels and indirectly operating expenses. Goals and ambitions Despite the recession, we are sticking to our goals and ambitions. Cosun s core competence is the processing of agricultural produce, such as sugar beet, potatoes, chicory, vegetables and fruit. We extract the maximum possible value from all our raw materials for the benefit of the entire supply chain. As a cooperative of beet growers, we want to uphold the strong position of the beet growing industry in the Netherlands and at least maintain our position as a European sugar producer. The European market organisation for sugar is an important factor in our ambitions. European beet growers and sugar producers want a strong internal sugar industry, if only with a view to sustainability. Whenever we process an arable crop, and beet in particular, we fulfil our responsibility not only for soil management, water consumption, biodiversity and CO 2 absorption but also for preserving the landscape, the vitality of the countryside and direct and indirect employment in the primary sector. We are also aware of our carbon footprint: the total CO 2 impact of an end product when bought by the consumer. 6 Report of the board and the executive board / Cosun Annual Report 2009
cutive Board A cooperative is dedicated to long-term continuity and must continuously respond to its environment. Jos van Campen Chairman of the Board Cooperative A cooperative is dedicated to long-term continuity and must continuously respond to its environment. That is why we take account of divergent stakeholders, invest in relationships and ensure that our members interests will also be protected in the future. The cooperative will not abandon its core value of cooperation based on shared interests. It has therefore been decided to eliminate the difference in profit entitlement that arose following the accession of the former CSM Suiker growers as quickly as possible. This will increase our effectiveness in the future. That is why we will continue in 2010 to steer our business towards sustainability, convinced that planet and profit not only go hand in hand but are also a source of renewal and improvement. Even or perhaps, especially in times of economic recession. What now? Economic recovery is currently uncertain. True recovery and sustainable growth will probably take longer than hoped. Cosun is not sitting still and is pursuing the course it has plotted. The direction is clear, our organisation is ready and consumers might be critical but they are also willing to pay for healthy and responsible food. Breda, 11 March 2010 J.E.M. van Campen R.P. Smith Cosun Annual Report 2009 / Report of the board and the executive board 7
Financial performance Cosun achieved a net turnover of EUR 1,758 million in 2009, slightly higher than in 2008 despite the economic recession. The recession exerted pressure on both sales volumes and selling prices. Nedalco in particular saw a sharp drop in demand in the first half of 2009 and production at Bergen op Zoom had to be suspended for part of the year. There was a modest recovery in the second half of the year. The increase in turnover was due chiefly to the acquisition of sugar and bioethanol activities in Anklam, Germany, in early 2009. Despite the economic headwind, there was a clear 9% improvement in operating profit to EUR 93 million. Virtually all business groups managed to improve their operating profits, in part through further growth at Sensus and Suiker Unie in particular and in part through the timely implementation of cost saving programmes at the other activities. Turnover and results Cosun s net turnover for 2009 amounted to EUR 1,758 million (2008: EUR 1,689 million). Operating profit increased from EUR 86 million in 2008 to EUR 93 million in 2009, including incidental items. The main incidental item in 2009 related to the planned termination of Nedalco s production operations in Bergen op Zoom. In 2008, incidental income had been recognised in respect of the restructuring aid granted for the closure of the sugar factory in Groningen. Adjusted for incidental items, operating profit increased by EUR 31 million. Performance of the business groups Suiker Unie s turnover was lifted chiefly by the acquisition of a sugar and bioethanol business in Germany. Suiker Unie was also able to export sugar at favourable prices owing to shortages on the world market. By-product prices, by contrast, were far lower than in 2008 owing to weakness in the animal feed market. The synergy benefits and cost savings that have been achieved since the acquisition of CSM Suiker in 2007 and the closure of the Groningen sugar factory in 2008 contributed to operating profit for the full year. On balance, there was a significant improvement in Suiker Unie s operating profit. The acquisition in Germany made an immediate contribution to operating profit and the net result in its first year. Sensus saw demand for inulin decline in the first quarter. Sales recovered strongly, however, as from the second quarter, especially in the United States. Worldwide, demand for functional foods such as inulin is continuing to strengthen and Sensus accordingly reported further growth in turnover and profitability. Nedalco, by contrast, had to contend with a sharp drop in demand for alcohol as a result of the recession. To prevent high stock levels, production in Bergen op Zoom was suspended for part of the year, which reduced the cover for fixed costs. In addition, a one-off expense was recognised in anticipation of the factory s closure in 2010. Nedalco s operating profit was therefore lower than in the previous year. Aviko saw a limited decline in its turnover in 2009, chiefly as a result of lower sales of dried potato products and lower income from residual flows (starch and animal feed). Despite a contraction in the market and the partial loss of credit insurance, turnover on the chip activities was higher. An increase in the proportion of premium products in the portfolio had a positive impact on Aviko s profitability. Furthermore, cost saving measures compensated for the pressure on selling prices, which led to an improvement in operating profit. After a very disappointing 2008, SVZ reported a clear improvement in its results in 2009. Demand in the vegetable and fruit ingredients market shifted from more expensive to cheaper fruits. The large volume supplied during the harvest reduced the price of several important fruits. Despite a 10% increase in sales volume, both turnover and the contribution margin were lower. The cost saving measures taken to compensate for the narrower contribution margin and for an additional value adjustment to stocks were not enough to close the year with an operating profit. Unifine Food & Bake Ingredients turnover was reduced by lower sales, particularly in countries that were hit hard by the economic headwind, such as Russia and Spain. Unifine s competitiveness was also weakened by the relatively high euro against the pound sterling and east European currencies. Nevertheless, operating profit before incidental items was higher. The measures taken at the end of 2008, including a reduction in the Belgian factory s relatively high cost base, cushioned the consequences of the recession. 8 Financial performance / Cosun Annual Report 2009
Financial expense and tax burden The cash inflow from operating activities considerably reduced the borrowing requirement. Group net financial expense fell by EUR 8 million to EUR 14 million (2008: EUR 22 million). The cash inflow from operating activities was generated in part by a reduction in working capital. In addition, interest rates were slightly lower. The effective tax burden fell to 22.7%. On balance, the net result for the year increased by 45% to EUR 59.4 million. Investments Owing to the cautious investment policy, capital expenditure was lower than depreciation, amounting to EUR 45 million (2008: EUR 67 million). The main investments apart from customary replacement investments were an anaerobic reactor, energy-saving equipment and automated process controls (Suiker Unie). Balance sheet Total assets were slightly lower at EUR 1,565 million (2008: EUR 1,669 million), on account of both the lower level of capital expenditure and a reduction in current assets after restructuring aid for the closure of the sugar factories in Groningen and Slovenia was received in full in 2009. The aid was applied to repay loans. Group equity increased by EUR 29 million to EUR 753 million (2008: EUR 724 million). Group equity as a percentage of total assets increased to 48% in 2009 and remains very healthy. The group s strong financial position thus remains undiminished. Cash flow Cash flow from operating activities amounted to EUR 225 million in 2009 (2008: EUR 114 million). Net investments and acquisitions/disposals for the year came to EUR 106 million (2008: EUR 54 million). Part of the free cash flow was applied to reduce the debt position and part for the distribution to members. Beet price and distribution on shares 2009 was an excellent year for sugar beet, with a record average yield in the Netherlands of 14.0 tonnes of sugar per hectare. The basic price paid for quota beet from the 2009 campaign was EUR 26.25 per tonne, EUR 1.50 less than in 2008. The decline was brought about by a reduction in the EU minimum price. The members bonus based on the profitability of the Dutch sugar activities came to EUR 9.00. On balance, the price paid to members was set at EUR 35.25 per tonne of beet with 16% sugar content and an extractability index of 87. The price paid for quota beet with average sugar content and extractability was EUR 43.00. The average surplus beet price for 2009 was EUR 30.44. The average financial yield for the growers was therefore EUR 3,252 per hectare (excluding the distribution on shares). Since the result on other activities was better than in 2008, the distribution for the year on shares entitled to a distribution from other activities amounts to EUR 2.25 per tonne of quota beet. The distribution in 2008 had been EUR 0.25 per tonne of beet. PROSPECTS It is still uncertain how long the economic recovery will linger in western Europe and the Netherlands. The food industry in which Cosun is active suffered less from the recession than many other sectors last year. Turnover is expected to be lower in 2010, however, owing to the fierce competition on the chip market and the lower sugar price. Despite the fall in consumer expenditure, the profitability of most activities was improved in 2009 by timely cost saving programmes. The focus on such measures will remain just as sharp in the coming year. Cosun will also seek to strengthen its current market positions by continuing to invest in process and product innovations. A further fall in sugar prices may exert pressure on Suiker Unie s profits. It is currently thought that the decline will be modest, partly because of scarcity on the world sugar market. The price war expected in the private label market for chips may possibly have ramifications for Aviko s profits. Further cost savings will not be high enough to fully offset the negative impact on margins. If the recovery gains momentum, the other business groups are expected to report an improvement in their results. On balance, Cosun does not expect the result to differ substantially from that for 2009. We shall continue to focus on earning sufficient cash inflow to shorten the assimilation period as soon as possible. Investments in the business groups will remain below depreciation in 2010. A great deal of attention will be paid to investments in energy savings and generating green energy from residual flows. No significant changes are expected in the size of the workforce. Cosun Annual Report 2009 / Financial performance / Prospects 9
Cooperation works Knowledge, people, environment Cosun stands out for its efficiency in processing agricultural produce. In large processing units we make products and ingredients that are sold chiefly to industrial customers and the foodservice sector. These customers are sensitive to price levels and are very critical purchasers. They are also responsive to the quality and safety of our products and demand clear agreements on our input. Cost control, operational excellence and close cooperation are therefore top priorities in our businesses. We can reduce our cost levels and environmental impact by means of efficient logistics and by making less use of raw materials and consumables, fossil fuels and water. That is why we are concentrating on energy savings in our processes and product innovations. A striking example is the sale of inulin in new liquid forms that deliver considerable energy savings throughout the supply chain (to the customer). Process optimisation Cosun s businesses are driven by processes and technology. Total Productive Maintenance (TPM) is an advanced, tried and tested method to improve our businesses performance by developing staff competences on the one hand and optimising the equipment and processes on the other: operational excellence. TPM is also a seamless complement to corporate sustainability. It maps out losses and costs in our operations and offers methods to address them. The staff are the leading actors: they identify weaknesses, propose solutions and are directly involved in making improvements. They become the owners of their processes. It is a continuous process of growth and development. TPM activities are currently being carried out in all business groups, with the focus placed firmly on production activities and thus the primary process. Thanks to the introduction of autonomous maintenance, the machinery is kept in optimal condition and its use is improved by the close involvement of the operators. In nearly all cases, this leads to a better result, more grip on the process and thus less stress on the work floor. Targeted improvement projects known as kaizens have improved the return on raw materials, eliminated persistent causes of disruption, removed dangers and quality problems, and reduced energy consumption. In total, more than 80 members of staff, from team leaders to plant managers, have taken two three-day facilitator training courses on the theory and, especially, practice of TPM. A Cosunwide TPM platform has been established for TPM coordinators to share their know-how and experiences, assess each other s ideas and form an expertise centre within the group. Cooperation with stakeholders Business is about more than just managing a process, setting priorities and selling products. Business offers work, profit and fulfilment to the many people involved but there are also negative aspects. Production processes release emissions and discharges into the environment and are sometimes a source of nuisance. Cosun is fully aware of this and is in contact with its stakeholders (those who can influence or are influenced by our business) to keep the impact to a minimum. Our staff and the members of the cooperative have the highest priority; their commitment and input are of the greatest importance and ensure our continuity. Cosun also recognises the vital importance of good contact with customers and local residents, especially when they are affected by any changes we make. We talk to companies in the food industry and the retail and foodservice sectors and to animal feed and non-food manufacturers. We usually do so informally, by business or even by location. The fact that Cosun is relatively unknown to the general public is of secondary importance to our aim of clear and reliable communication. 10 Cooperation works / Cosun Annual Report 2009
CFTC Cosun Food Technology Centre (CFTC) works principally for the business groups and also regularly for their customers. CFTC receives a great deal of information from the businesses (wishes, needs, problems, etc.) and about their markets and can draw on the combined know-how and expertise of more than 50 specialists in process technology, product development and application research. CFTC s profile is being changed by the Cosun strategy, with more emphasis being placed on process technology and energy management. Projects and initiatives in 2009 CFTC carried out many projects in the past year, including: a study of fibre concepts for human nutrition; a comparison of various processes and production specifications for Suiker Unie and the former CSM Suiker to find optimal combinations with the best results; the use of models to analyse and improve production processes, especially with regard to energy efficiency; application research to reposition sugar with regard to glucose and maltose in, for example, confectionery; a study to increase the efficiency of biogas production from biomass flows. Balancing mineral and other cycles is also enjoying increased interest. CFTC is working with IRS on a study to optimise the beet and chicory harvest. A promising option is the use of minerals recovered as fertiliser in arable farming. Many of the projects are concerned with extracting the maximum value from the raw materials the Cosun businesses process. Knowledge of organic chemistry, separation technology, biorefinery and biofermentation is essential to get the most out of the agricultural produce. This approach, moreover, often has environmental and economic benefits. Lower energy consumption through the fermentation of residual products and the reuse of process water after demineralisation reduce both the environmental impact and operating expenses. CFTC is thus contributing to corporate responsibility and sustainability. CFTC s advisory council was installed in 2009. It consists of the managing directors of the business groups and the Corporate Development director. They will decide what knowledge CFTC must accumulate and attract to satisfy the needs of the future. CFTC already acts as the link between Cosun and external knowledge sources such as universities, research centres and knowledge networks. It participates in many alliances, including the Carbohydrate Competence Centre (CCC), the Dutch Separation Technology Institute (DSTI) and the BIC (Biorefinery Innovation Centre). Staff Efficiency measures and market developments have meant that relatively few young people have joined some of our production companies in recent years, particularly in the sugar and potato activities. The average age of the workforce has accordingly risen sharply. We are running the risk of facing a shortage of skilled people in the future. To prevent this, we consciously invested in the future by employing young people and training them in specific functions. Suiker Unie in Dinteloord, for example, took on technically trained young people in addition to the staff establishment numbers in order to secure the knowledge and experience necessary to keep the factories running smoothly and efficiently. On the other hand, the recession has led to a reduction in the number of staff at other places in the group. In particular, SVZ had to release a number of employees in 2009. On balance, the number of permanent staff at the group, expressed in full-time equivalents, was slightly higher on account of acquisitions. Fewer temporary staff were engaged, however, in comparison with previous years. Further automation is changing the work of many members of staff. Product flows and logistics processes have become unthinkable without parallel information flows. They enable the staff to oversee and manage ever-greater parts of the process. Tasks that had previously been carried out by several people can be combined into one position. This calls for new skills, professional development and retraining. Another way in which it is doing so is to offer traineeships to young technologists. Here, too, there are benefits on all sides: the trainee gains relevant work experience for later, CFTC gains additional temporary capacity and the labour market enjoys an inflow of well trained and enthusiastic food and process technologists that the Cosun businesses can also draw on. To support Cosun s long-term goals, CFTC will deepen and widen its knowledge and expertise in the field of energy management. At the end of 2009 it decided to take on two experts in energy management. Cosun Annual Report 2009 / Cooperation works 11
Environment Cosun s environmental policy rests on two pillars: raw materials and energy. These are the two most important factors of production. Any savings we can make on them has an impact on the environment and our profits. Encouraging results were booked in this area in 2009. They arose from all manner of projects and initiatives, such as the prevention of raw material losses, the reuse of water and heat, emission reductions, alternative energy sources, energy savings, balancing mineral cycles and a fresh approach to the potential of crops and residues. Our innovative strength and know-how underpin these benefits and we will continue to invest in them. We also work with other businesses and institutions that are involved in emissions trading, environmental policy, corporate sustainability and the like. We think it is important to share knowledge. There are many similarities between our production businesses and they use many comparable techniques and methods, such as TPM, which has been rolled out across Cosun to improve processes and prevent the loss of raw materials and energy. The environment and profitability go hand in hand. They are incentives for improvement and renewal. We shall continue on this path in 2010. Cosun will place even more emphasis on corporate sustainability in the business strategy we have adopted, with people, the environment and the members interests being closely involved in our decisions. For more information, see: www.annualreport-cosun.com (environmental report 2009) 12 Cooperation works / Cosun Annual Report 2009
Operations Suiker Unie Sugar and -specialities The consolidation of the European sugar market continued in 2009. It led to even fewer sugar producers. Suiker Unie succeeded in increasing its market position, in part through the acquisition of Danisco s sugar activities in Anklam, Germany. Suiker Unie s turnover was higher than in 2008 despite weaker sugar prices on the European market. The increase was due in part to the acquisition of the German sugar activities and in part to additional sales of surplus sugar on the world market. The consolidation is exerting pressure on selling prices and intensifying competition in the European market. Suiker Unie intends to maintain its margins through targeted cost saving programmes. At the same time, unusually high prices on the world market for export sugar made a positive contribution to Suiker Unie s profitability. Access to the world market, however, is limited by the EU market organisation for sugar. Suiker Unie is therefore calling for more opportunities to export to the world market. Low grain prices placed pressure on the price of animal feeds such as sugar beet pulp. Stronger position in Europe The sugar activities of Danisco Sugar in Anklam, Germany, were acquired in the first quarter of the year. The transaction strengthened Suiker Unie s position in the northwest European market and reduced the distance to international customers in this area. The unbundling of Danisco was completed smoothly and the business is now fully integrated into Suiker Unie. The new company, Suiker Unie GmbH, produces more than 110,000 tonnes of sugar and some 50,000 m3 of bioethanol per annum and employs 140 qualified staff. Record yield The 2009 beet campaign in the Netherlands broke all records: 14,0 tonnes of sugar per hectare in a campaign that lasted more than 140 days. The EU quota of 805,000 tonnes of white sugar was comfortably exceeded. In total, the 2009 campaign produced 992,000 tonnes of beet sugar. Suiker Unie also refined raw cane sugar into granulated sugar. In Germany, the yield was 11.7 tonnes of sugar per hectare. The campaign there lasted 120 days. In total, so much surplus sugar was produced in addition to the 112,000 tonnes of quota sugar that full use could be made of the bioethanol capacity in 2010. Concern for energy consumption and the environment Suiker Unie uses energy, water and consumables as carefully as possible. The TPM methodology has been introduced at the Suiker Unie locations to further improve profitability and reduce costs. It is facilitating both the ambition to produce cost efficiently and the wish to spare the environment. Optimal use of the sugar beet has always had high priority. Granulated sugar, molasses, beet pulp and Betacal are used as foodstuffs for people and animals and by-products are returned to the fields or used as soil improvers. Green energy generation was introduced a number of years ago. At the factories in Dinteloord and Vierverlaten, methane reactors produce biogas from sugars and from beet residues in washing water. Suiker Unie wants to invest further in this form of biogas production. A permit has already been granted to build a biogas production facility at the factory in Dinteloord. This facility will also be able to process larger vegetable waste flows such as beet shreds, beet leaves, potato peelings and other vegetable material. Sustainable cooperation The biogas production concept seamlessly fits Suiker Unie s plans to safeguard the sustainability of sugar production in the Netherlands. Suiker Unie is developing a dedicated business park of about 50 ha in Dinteloord and is entering into a symbiotic relationship with the planned horticultural development of more than 200 ha in the immediate neighbourhood. Symbiosis will occur when the businesses exchange flows with each other, for example the CO 2 released when Suiker Unie raises biogas to natural gas quality can be supplied to the market gardeners. Waste products and residual flows from the greenhouses can be fermented in Suiker Unie s biogas facilities. Cosun Annual Report 2009 / Operations 13
The closure of the sugar factory in Groningen was completed in 2009. The staff were transferred to other Suiker Unie and Cosun businesses or helped to find alternative work. Demolition of the building and the equipment is progressing on schedule and an agreement has been signed with the municipality of Groningen on the sale of the site. The site will be handed over to the municipality as agreed in the course of 2010. Sensus Inulin Inulin producer Sensus witnessed a sharp drop in sales in the first quarter of 2009. European customers in particular waited to see how the market would develop and ran down their stocks. Demand recovered again in the second quarter. Over 2009 as a whole, sales were actually higher than in 2008. As a functional ingredient, inulin has now gained a strong position in the market and is no longer targeted exclusively at niche markets. Promising fibre concepts Inulin is used in cereals and cereal bars especially in the United States. Both manufacturers and consumers there more so than in Europe and Asia are receptive to the concept of fibres contributing to weight management and healthy intestinal flora. As well as the ingredient, Sensus also sells the knowledge needed to make optimal use of the concept. It prefers direct contact with the customer so that the scientific underpinning of the fibre concept is properly understood. This approach was expressed in a new slogan in 2009: Making inulin work for you. In other areas, too, Sensus is investing in its future. Its goal is to optimise production processes so that more inulin can be produced at the lowest possible cost from the same quantity of raw material. A positive side effect is the reduced environmental impact. Sensus, for example, provides 20% of its own gas requirement and emits fewer greenhouse gases by producing biogas. Considerable progress was made in 2009 with the introduction of TPM in the operations. Good raw material yield The volume of chicory roots, the raw material for inulin, harvested in the 2009 campaign was above expectation. The quality and extractability (content) also scored highly. As a result of the abundant harvest, the campaign was to last into the new year despite its relatively early start in September. Sensus invested in the quality of the raw material during the year, in part by cooperating with growing specialists at the IRS, the Dutch sugar beet research institute. With a little modification, the growing model developed for sugar beet is perfectly suited to chicory. Technical information has been distributed to increase interest in chicory amongst growers and thus improve the yield. Growth prospects Sensus is looking forward to 2010 with confidence. The European Food and Safety Authority will probably decide on the claim that inulin has demonstrable benefits for intestinal flora and the sense of satiety in 2010. Sensus is looking forward to the decision with confidence and expects inulin sales to increase in the near future. Although it will depend on the economic recovery, the outlook for a functional ingredient like inulin is excellent, especially in the light of the growing interest in healthy food. 14 Operations / Cosun Annual Report 2009
Nedalco Alcohol The consequences of the recession were clearly felt in 2009; Nedalco s first-half turnover was almost 25% lower than in the comparable period a year earlier. Demand fell in all sectors of the market: from drinks to pharmaceuticals. This placed additional pressure on selling prices. The cost base was lowered through timely and decisive interventions (such as the temporary closure of the factory in Bergen op Zoom). These measures enabled Nedalco to limit its losses. Factory closure It has since been decided to close the factory in Bergen op Zoom permanently in mid-2010. This factory processed some of the molasses produced by the Dutch sugar factories. The closure will mark the end of an era of collaboration between the Dutch sugar industry and Nedalco. Following the closure, the Nedalco factories in Sas van Gent and Manchester (UK) will process only starch remaining after wheat is processed. These factories are located in the direct vicinity of suppliers of this raw material. A redundancy plan has been drawn up to help staff at the Bergen op Zoom factory find alternative employment either inside or outside Cosun. The staff concerned are employed chiefly in production, maintenance and despatch. Staff in the central organisation and the R&D specialists will be transferred to another location in Bergen op Zoom in the course of 2010. Second generation technology Nedalco is investing further in the development of C5 technology to convert vegetable and woody plants into bioethanol. This technology makes it possible to convert waste flows from the agri-food industry that cannot be used as food into energy. Nedalco is one of the forerunners in this technology and has built up a strong patent position. It will continue to invest in the technology in the years ahead and, in cooperation with potential users of the knowledge, will study ways to optimise its use in practice. The United States is setting the pace in this market, followed by countries in the Far East. As a socially responsible business, Nedalco is seeking a healthy environment by minimising nuisance and harmful emissions and maximising water and energy savings. It is against this background that Nedalco is developing a technology to produce bioethanol from waste products that do not compete against food. Although the economic situation is still uncertain, Nedalco expects to see a recovery in demand from all market segments and to receive royalties from C5 technology in 2010. Strong market position There was also good news in 2009: Nedalco acquired the remaining interest in Brüggemann Alcohol in Germany. This transaction strengthened Nedalco s position in northwest Europe. The location in Heilbronn processes, amongst other things, raw alcohol into high quality end products. A lot of time and attention was also paid in the past year to optimising the production process and to further improving staff working methods. Nedalco is using TPM to reduce errors, complaints, accidents, waste and costs. And, of course, to increase staff motivation and commitment. Cosun Annual Report 2009 / Operations 15
Aviko Potato products The Aviko group has three main activities. The first is the production and sale of chips and potato specialities under the Aviko brand name and under private labels. Aviko Rixona produces potato flakes and granules that are used as ingredients in, for example, purees and snacks. Thirdly, operating under the name Duynie, Aviko extracts value from by-products of the food industry, chiefly for use in animal feed. Under the name Novidon, it recovers starch from residual flows and process water for use in non-food products. Despite the economic recession, the relatively expensive euro and the partial loss of credit insurance, Aviko realised a modest increase in its chip and potato speciality turnover in 2009. Selling prices were squeezed by the lower demand for potato products in the foodservice sector and increased production capacity in western Europe. Sales in the retail sector remained steady. Strengthening the foundations Significant volumes of potatoes were again available in 2009; the quality, however, was poor. Making a high quality product was quite a challenge. Consumers are critical about what they buy, seek out new specialities and are very price conscious. In both the retail and the out-of-home sector, sales are under pressure and purchases are increasingly being driven by price. Aviko is making optimal use of the opportunities available in the market and offering a keen product range, with ever-more specialities such as complete potato-based dishes, steamed products, gratins and SuperCrunch chips. tighten its grip on the production process. To do so, Aviko like most other Cosun businesses is gradually introducing TPM. The first results (including cost savings and a reduced environmental impact) were already visible in 2009. Aviko Rixona suffered from pressure on prices due to overcapacity, especially in industrial sales of potato granules. Retail sales, however, developed well. The flake factory in China is now running smoothly and has ample raw materials of a high quality. The priority in China now is to develop the local sales market. In 2009 Duynie considerably increased its sales volumes but had to contend with low prices in the animal feed market. Novidon s products are well received by industrial customers such as paste producers. The low prices paid for both wheat and starch, however, placed strong pressure on the result. Continued investment in people and equipment Aviko expects chip prices on the private label retail market to remain under pressure in 2010. Although it will no doubt suffer the negative consequences of this exposure, it is looking to reduce it through further growth in premium products. The situation is not discouraging Aviko from investing in people and equipment. The TPM programme will be rolled out further, measures to minimise the environmental impact will be sharpened up (less consumption of fossil fuels, water and packaging materials) and more emphasis will be placed on products that complement a responsible diet such as non-fried specialities and Fridéale chips. In Scandinavia, Aviko acquired the shares outstanding in Algen. This business unit will in future operate under the name Aviko Norden. The first step to integrate Eurofreez was satisfactorily completed and in Spain Aviko acquired a minority interest in Eurofrits with a view to gaining access to the Iberian market. To maintain its profits, a great deal of attention was paid to the cost structure. Where possible, savings were made on energy and water, raw material wastage was addressed and the company will further 16 Operations / Cosun Annual Report 2009
SVZ Fruit and vegetable products The stringent measures SVZ had taken at the end of 2008 clearly bore fruit in 2009. Although the results remained below the desired level, they were better than in the previous year. Turnover was lower chiefly on account of a sharp drop in prices for the main fruits, such as strawberries, cherries and bilberries. Demand for more expensive fruits was also weaker, partly because product compositions were reformulated to include cheaper ingredients. SVZ s margins came under fierce pressure. Demand from the market has still not returned to its previous level. Nonetheless, SVZ increased its volumes by nearly 10% in 2009. Cash flow for the year was also positive. The fruit market came under strong pressure from the substantial stock levels in the supply chain, significantly lower raw material prices and limited credit facilities. Some producers were forced to sell quickly. Market strategy and diversification of risks The various segments in the international market have been redefined on the basis of know-how and supplementary market research. A specific approach is now used for each segment and customer group. This should lead to more satisfied customers and an appropriate return for SVZ. The market strategy has again been designed around customer groups and key customers. SVZ wants to supply multinationals from the home markets of Europe and the United States. This will enable it to satisfy its customers wishes and comply with local regulations. Serving the market by dividing it into premium, standard and volume segments is a form of risk management: purchasing, production and stocks are based on signals from customers in these segments. Deprecation, stocks and costs will all be lower. A producer of smoothies has said, for example, that it will continue to buy from SVZ precisely for this reason. A large proportion of SVZ s management has changed position or been re-appointed in the past two years. A great deal has also changed for the production workers: the work is performed with fewer people, there are new administrative processes and often new managers. Product losses related to the production process have also been reduced and the quality of the products has been improved. The introduction of TPM at the Etten-Leur location has helped bring about these improvements. SVZ is confidently looking forward to 2010 for several reasons. The market for premium products such as smoothies seems to be picking up. Fruit is being promoted as an indispensable part of a healthy diet and demand for natural colourings and aromas is growing. SVZ is positioning itself as a worthy partner in the supply chain and wants to win and retain the position of preferred supplier in all the segments it has defined. Responsibility Large customers are increasingly making specific demands on their suppliers environmental impact and health and safety record. Suppliers are expected to take measures to satisfy these demands. If they do, their efforts are rewarded. Cosun Annual Report 2009 / Operations 17
Unifine Food & Bake Ingredients Bakery and dessert specialities Unifine F&Bi had already taken measures at the end of 2008 to cushion the impact of the recession. The programme was continued in 2009 and it is now bearing fruit: production processes have been simplified, the range has been streamlined, support services have been centralised and the location in Manage (Belgium) has been reorganised. On the Iberian Peninsula, a number of support services have been transferred from Spain to Portugal. Turnover for the year was slightly lower. A strict cost saving programme plus lower raw material prices allowed margins to remain intact. A start was also made on expanding production capacity outside the euro zone. To date, Unifine has produced in euro countries but usually exports to noneuro countries. It accordingly suffered from the relatively expensive euro. Unifine is also seeking to increase its added value by offering turnkey concepts in the speciality segment. The concepts comprise not only ingredients and formulas but also ideas for end products and their presentation and packaging. Higher prices seem to be possible if they are backed up by quality and service. For semi-industrial bakers who have several sometimes dozens of outlets in a certain region, Unifine offers customised products and deliveries. This strategy is bearing fruit. In the industrial segment, too, we are witnessing a change from buying purely on price to more consideration for quality and service. The effects of the combination of significant cost savings and a stronger market position are expected to lead to a further improvement in results in 2010. Stronger position in Europe Unifine wants to grow in both existing and new markets and segments in order to strengthen its position in Europe. Against this background, the activities on the Iberian Peninsula were concentrated in a modern factory with skilled staff in Portugal. In Romania, Unifine works with local raw materials to serve the regional market. The benefits can be seen in Unifine s profitability and also in the environment (fewer food miles) and the local community (local production means local jobs, both direct and indirect). Another measure taken in 2009 relates to the further professionalisation and partial outsourcing of warehousing activities. The main goal is to improve customer service. The benefits are two-fold: customers are served more quickly, reliably and flexibly and costs are easier to control. This is a long-term project that will be continued in 2010. 18 Operations / Cosun Annual Report 2009
Risks and risk management Cosun is active in a variety of markets in several countries and has to contend with the strategic, operational and financial risks that are inherent in the group s activities. Within this context, Cosun seeks to identify and control these risks at an early stage. It mitigates the risks by means of targeted product/market combinations, a flat organisational structure and a sharp focus on cooperation with customers and suppliers and among the Cosun businesses themselves. Once every five years, the risks facing the company are analysed and evaluated by means of workshops at all the business groups. In the intervening years, the outcomes of these workshops are assessed to verify that they are still relevant. The material risks that Cosun and the Cosun businesses face are identified as comprehensively as possible with regard to both their likelihood and their impact. The results of these assessments are used to define actions to mitigate the main risks wherever possible. The progress made implementing these actions is reported to the Executive Board. Strategic risks Sugar market The current European sugar market organisation will be in effect until 30 September 2015. How the market organisation will be continued after that date will not be known for some years to come. There will always be the possibility, however, of further quota reductions or higher imports. Within the market organisation, the trend towards greater competition and regionalisation of sugar production in the European Union will continue. Cosun will continue to study opportunities to cooperate with other European businesses to better serve the European market. The acquisition of the German sugar factory in Anklam in 2009 has strengthened Suiker Unie s market position. Consumer behaviour Consumer expenditure patterns are still being driven by price awareness. The economic downturn has sharpened this awareness. As a result, margins in the supply chain are coming under pressure. The continuous attention paid to improving business processes (operational excellence) is making an important contribution to maintaining the group s profitability. Greater awareness of healthy and responsible diets is changing customer preferences. Cosun is responding by developing innovative foods and ingredients that complement a responsible lifestyle, offer functional added value and are tasty and safe. Weather influences Owing to the nature and location of production, Cosun s results are determined largely by the weather. Wherever possible, Cosun matches its operations to climatic conditions and spreads the harvests over different countries and regions. Contracts with growers take account of the risk of poor harvests wherever necessary. Owing to the relatively limited geographical spread, this harvesting risk is particularly relevant to potatoes, sugar beet and chicory. Operational risks Raw materials Given the nature of its activities, the quality and availability of raw materials, principally sugar beet, chicory, fruit, vegetables and potatoes, have a significant influence on the effectiveness and efficiency of Cosun s operations. By informing and advising potato, sugar beet and chicory growers in detail about efficient production methods and by basing the payment system on quality, the group manages the quality of the raw materials and maximises the return for both the group and the growers. All beet growers that supply Suiker Unie are certified in accordance with a standards system drawn up by the industry. All Cosun businesses that produce food ingredients and foodstuffs comply with HACCP procedures. Cosun makes strict demands on the traceability of ingredients, thus meeting the requirements of industrial customers. SVZ and other business groups have designed their business systems to meet specific customer demands. Concentration of customers The loss of important customers can have a serious impact on the group s profitability. This risk is mitigated principally through the spread of activities within the group. At the largest business groups, the five largest customers represent less than 20% of turnover. Group policy is to build up and maintain a professional, customer-centred relationship with its customers. This is achieved by means of product innovation, customer support in application research and the optimisation of the logistics chain through various forms of stock management. Cosun Annual Report 2009 / Risks and risk management 19
Product liability As a producer of food ingredients, Cosun recognises the risks of product liability. An integrated framework of quality control, safety and traceability systems is in place to limit risks. Procedures have been introduced within the organisation to ensure a fast and appropriate response when required by circumstances. Adequate insurance has been taken out to cover the risk of product liability. Business continuity The concentration of production units increases the risk that a calamity such as a fire or explosion might significantly threaten the continuity of the business. Cosun has implemented programmes to mitigate the underlying threats. They include a continuous process of risk monitoring and risk management. A global insurance programme has also been set up in which assets are insured at their estimated value with appropriate coverage for loss of profits. Financial risks Position risk The purchase of many farm products directly from the source in a short period of time might create a mismatch between the purchasing position and the selling position, especially at Aviko and SVZ. Wherever possible, Aviko and SVZ balance their purchasing and selling positions in raw materials and end products. Nevertheless, there is an exposure to price risk, which can have a considerable impact on results. In general, low raw material prices eventually have an adverse impact on margins. The attendant risks are controlled by means of strict reporting and control procedures and the direct involvement of senior group management. Financing and interest rate risks To finance its operations, Cosun is highly reliant on interestbearing debt. To limit its reliance, Cosun has committed bank facilities and a US Private Placements programme. The US Private Placements programme is characterised by long-term loans, with remaining maturities of up to 9 years. The risk of interest rate movements and the exchange rate risk on the US dollar portion of the long-term loans are hedged in full by means of derivatives. The group has contracted committed bank credit facilities so that it can respond flexibly to its financing requirements. To meet the sugar campaign s cyclical financing requirement, Cosun has concluded a financing arrangement specifically tailored to this variable requirement. All Cosun businesses report their liquidity forecasts every month to reduce the risk of unforeseen liquidity shortages. Exchange rate risks Although Cosun is active chiefly in the euro zone, as an international business it is exposed to exchange rate risks. These risks are concentrated around the US dollar and the pound sterling. In principle, exchange rate risks arising on operating and financing activities are hedged. Tax risks Cosun is active in many countries. It seeks transparent relationships with local tax authorities. Activities are structured with a view to the central coordination of corporation tax. Responsibility for VAT, salaries tax, social insurance contributions and the like lies with the individual entities. Risks are limited by the policies conducted and internal control systems. 20 Risks and risk management / Cosun Annual Report 2009
Pension risks The pension risk relates principally to the underfunding of the pension schemes administered for the participating businesses. The policies of the pension funds in place for the group are highly risk aware. The funds have largely covered themselves against the risk of lower interest rates, for example, and the investment policy is characterised by a widely diversified portfolio with a variety of investment categories. Investment transactions have been contracted out in full to external parties. For the largest pension funds in terms of assets invested, investment decisions are coordinated by a specially appointed Fiduciary Manager. Internal control systems The external auditor conducts an annual audit in order to express an opinion on the annual accounts. The external auditor is appointed by and reports to the Supervisory Board. The audit scope and depth are determined annually in consultation with the Executive Board and the Supervisory Board, whereby the minimum work required for the audit opinion is extended to cover specific risks, business processes or locations that the Supervisory Board or the Executive Board believes should receive additional attention. Recommendations arising at every level from the external audit are reported to and followed up by the Executive Board. The Executive Board subsequently reports to the Board and the Supervisory Board. Cosun has an internal control system to control the risks attaching to the business activities and to monitor the efficiency and effectiveness of business processes, including administrative processes. The business groups themselves have primary responsibility for the control system. Group responsibility is laid down in the following framework: All business groups draw up three-year operating plans. The plan for the next year is used to test actual monthly and quarterly results. The results are discussed on a monthly basis at Executive Board level and on a quarterly basis at Board and Supervisory Board level. Detecting and pro-actively responding to risks is part of the operational planning procedure. Cosun s finance & control manual includes detailed guidelines on financial reporting and accounting and incorporates a section on risk control. The business groups financial managers report functionally to the Finance & Control director. The group has introduced a generic code of conduct that has been distributed to the staff in all parts of the group. A whistle blower s scheme has also been introduced to lower the threshold to report cases that might conflict with the code of conduct. All legal entities that are members of the group must sign a Letter of Representation each year. In it, management declare that they have acted in accordance with the various internal guidelines and with the rules arising from legislation and regulations or imposed by external supervisors. Cosun Annual Report 2009 / Risks and risk management 21
Cooperative issues It was decided in 2009 to eliminate the difference between the rights on shares issued before 2007 (old shares) and the rights on shares issued after that date (new shares) ahead of schedule. The difference arose on the accession of many new members in 2007. All shares participate in the cooperative s results on sugar activities but only the old shares participate in the results on other activities. The difference in the distribution on the old and the new shares, which is linked to the results on other activities, has prompted a great deal of discussion among the members in recent years. The Members Council therefore asked the Board to present proposals to eliminate the difference earlier than planned. Shorter assimilation period After extensive discussion, the Members Council agreed to an amendment of the regulations in order to eliminate the difference between old and new shares as quickly as possible. This will be done through a reduction in the assimilation period in combination with a simultaneous additional profit distribution to members holding old shares. Growers with old shares will receive a payment by way of compensation for the fact that growers with new shares will participate in the whole of the group s results at an earlier date. This additional payment will be financed from incidental items so as not to weaken the cooperative s financial position. The speed of the accelerated assimilation will depend in part on the total financial result. Income from the sale of the factory site in Groningen in 2010 and that part of the restructuring aid set aside in 2008 will make full assimilation possible as from 2012 and if the operating profit permits, 2011 may even be possible. It was decided at the beginnning of 2010 to take the first step in the planned reduction for the years 2017, 2016 and 2015. European market organisation In 2008 Cosun and the growers received restructuring aid by way of compensation for the surrender of 13.6% of the sugar quota. Cosun made an extra payment to the growers in addition to the aid received from Brussels at the beginning of 2009. Cosun also stood guarantor for any repayment of restructuring aid owing to the legal action taken by Cumela when contract workers disagreed with the allocation of compensation between growers and contract workers. The Ministry of LNV disbursed the aid in full in June 2009. Without the guarantee, 60% of the aid would not have been paid until February 2010. In addition to restructuring aid, EUR 11.9 million was made available in the form of diversification aid to growers who surrendered all or part of their sugar growing rights. Cosun recommended that this amount not be spent on all manner of projects but be distributed in so far as possible directly to the growers as investment aid. This recommendation was accepted. The number of applications, however, proved far greater than the amount available. Lots therefore had to be drawn among the applicants. No limits were placed on the number of applications per farm. Some growers had several applications honoured while most were rejected. 22 Cooperative issues / Cosun Annual Report 2009
Administrative affairs In May 2009 Mr G.M. van Tilburg and Ms G. Prins were reappointed to the Board. Mr C. van Hilten retired from the Supervisory Board and did not stand for reappointment. Owing to the planned reduction in the number of members of the Supervisory Board, this vacancy was not filled. Mr N.H. van Halder was re-elected to the Supervisory Board. The Members Council met on four occasions. The main topic of discussion was the reduction of the assimilation period for new shares. The annual meeting had a festive edge owing to the cooperative s 110th anniversary. The Youth Council met on three occasions during the year. The programme for one of the meetings included a discussion with the Chairman of the Board and the CEO. The Youth Council also visited inulin producer Sensus in Roosendaal. On behalf of the Board J.E.M. van Campen Breda, 11 March 2010 On behalf of the Executive Board R.P. Smith Beet yield per hectare in the Netherlands (in EUR) 2009 2008 2007 2006 2005 3,252 2,902 2,524 3,117 3,172 The table presents the income from the sugar beet harvest per hectare in 2009-2005. The figures are calculated on the basis of average yield and average quality sugar content and extractability with due allowance for premiums for early and late supply, batch size and tare allowance. Cosun Annual Report 2009 / Cooperative issues 23
Members and shares per district as at 31/12/2009 as at 31/12/2008 Section/district number of members number of shares number of members number of shares Zeeuwsch-Vlaanderen 793 9,124 813 9,111 Zeeland-Midden 678 8,007 692 8,056 Zeeland-Noord 373 4,739 393 4,807 Goeree-Overflakkee 233 3,598 240 3,568 West-Brabant 901 9,882 919 9,990 Zuid-Hollandse Eilanden 365 5,150 373 5,119 Holland-Midden 291 4,709 301 4,883 Kop van Noord-Holland 445 7,622 460 7,686 Oostelijk Flevoland 423 10,011 441 10,247 Noordoostpolder 682 10,396 702 10,604 Friesland 302 4,865 307 4,891 Groningen 1,113 19,872 1,143 19,738 Drenthe/Overijssel-Noord 1,116 22,867 1,178 22,979 Overijssel-Zuid/Gelderland 379 4,350 392 4,389 Oost-Brabant+Limburg (CSV COVAS) 1 28,436 2 28,875 Zuidelijk Flevoland 172 5,317 172 5,295 8,267 158,945 8,528 160,238 CSV COVAS B members 1,952 2,368 as at 30/04/2009 TOTAL Cosun members 10,219 10,896 24 Members and shares per district / Cosun Annual Report 2009
Members of the Board, Supervisory Board, Executive Board and Central Works Council as at 31 December 2009 Board Executive Board Chairman J.E.M. van Campen, Ens President & CEO R.P. Smith Vice-Chairman G.M. van Tilburg, Bant Members S.A. Brandsma, director Unifine F&Bi Deputy Vice-Chairman I.L.G. van Melle, Schoten (Belgium) A.J. Markusse, director Suiker Unie Members P.W.M. van den Berg, Bergeijk E.J. Peet, director SVZ J.M. Klompe, Wolphaartsdijk G.H. de Raaff, D.H. de Lugt, De Cocksdorp director Corporate Development A. Maarsingh, Stadskanaal M.J.M. van de Ven, director Aviko J.M.M. Megens, Driebergen Ms. T.A. van de Werken, Ms. G. Prins, Nieuwkoop director Finance & Control J.A. Smid, Dalerpeel Secretary Ms. M.J.C.W. van den Maagdenberg T. van der Torren, Zonnemaire Secretary J.W.M.J. van Roessel Supervisory Board Chairman Secretary Members W. van der Zee, Zaamslag C.E.M. de Waal, Roermond J. Bartelds, Tweede Exloërmond J.F. Botma, Oosternijkerk N.H. van Halder, Tilburg P. Molenaar, Bergschenhoek F. Wiersema, Spijk Central Works Council Chairman P. Hen, Aviko (till 01-01-2010) A. Jansen, Suiker Unie (from 01-01-2010) Secretary J.P. Blaauwhoed, Cosun (CFTC) Members C.W. van Agtmaal, SVZ H. Arfman, Aviko A.C.J. van der Borst, Suiker Unie E. Coenen, Nedalco H.A.M. Flipsen, Suiker Unie Ms. J. Goossen Cazemier, Aviko R. de Jong, Nedalco R. Kalwij, Cosun C.J.P. van Rijen, Sensus Vacancy, SVZ Cosun Annual Report 2009 / Members of the board, supervisory board, executive board and central works council 25
Report of the Supervisory Board The Supervisory Board met on 7 occasions in 2009. A joint meeting was held with the Board. The Supervisory Board was also present at the 4 meetings of the Members Council held in 2009 and the members meetings held throughout the country. The Supervisory Board devoted a great deal of attention to financial reporting and the development of activities. Its deliberations also covered divestments, acquisitions, financing, business risks and the strategy. The acquisition of the German sugar and bioethanol producer in Anklam and the faster assimilation of the new shareholders received special consideration. The consequences of the economic crisis were also analysed. Mr N.H. van Halder was re-elected as a member of the Supervisory Board by the Members Council. Mr C. van Hilten stood down upon reaching retirement age. The Supervisory Board met the external auditor, KPMG Accountants N.V., on two occasions in 2009 to discuss the findings of the audit of the 2008 accounts, the accounting system and internal controls, the scope and depth of the audit for 2009 and matters of special interest. The findings of the audit of the annual accounts for 2009 were discussed with the auditor in March 2010. Pursuant to Article 31, paragraph 4, of the Articles of Association, the Supervisory Board has examined the annual accounts of Koninklijke Coöperatie Cosun U.A. for 2009. In this examination, the Supervisory Board was assisted by the auditor appointed by it. KPMG Accountants N.V. issued an unqualified auditor s report on the annual accounts for 2009. It is reproduced in the section Other information. The auditor did not make any special notes in its report. The Supervisory Board recommends that the Members Council approve the accounts. On behalf of the Supervisory Board, W. van der Zee C.E.M. de Waal Breda, 11 March 2010 26 Report of the supervisory board / Cosun Annual Report 2009
Addresses Royal Cosun Cosun Food Technology Center Cosunpark 1 P.O. Box 1308 P.O. Box 3411 NL-4700 BH Roosendaal NL-4800 MG Breda Telephone +31 165 58 28 10 Telephone +31 76 530 33 22 Fax +31 165 55 13 52 Fax +31 76 530 33 03 Internet www.cosun.nl Internet www.cosun.nl E-mail infocosun@cosun.com Suiker Unie Sensus P.O. Box 100 P.O. Box 1308 NL-4750 AC Oud-Gastel NL-4700 BH Roosendaal Telephone +31 165 52 52 52 Telephone +31 165 58 25 00 Fax +31 165 52 52 55 Fax +31 165 54 60 83 Internet www.suikerunie.nl Internet www.sensus.nl E-mail info@suikerunie.com E-mail info@sensus.com Royal Nedalco Aviko P.O. Box 6 P.O. Box 8 NL-4600 AA Bergen op Zoom NL-7220 AA Steenderen Telephone +31 164 21 34 00 Telephone +31 575 45 82 00 Fax +31 164 21 34 01 Fax +31 575 45 83 80 Internet www.nedalco.nl Internet www.aviko.nl E-mail info@nedalco.nl E-mail info@aviko.nl SVZ Unifine Food & Bake Ingredients P.O. Box 27 P.O. Box 9394 NL-4870 AA Etten-Leur NL-4801 LJ Breda Telephone +31 76 504 94 94 Telephone +31 76 572 41 40 Fax +31 76 504 94 00 Fax +31 76 572 41 50 Internet www.svz.com Internet www.unifine.nl E-mail info@svz-nl.com E-mail info@unifine.com 62 Addresses / Cosun Annual Accounts 2009