ANNUAL REPORT Activity and Sustainable development FOREWORD
With this 2018 activity and It also presents our new sustainable development strategic road map, Avril 2023 report, Avril is for the first and its associated CSR time publishing an framework, “Spring”, which “integrated” report inspired will help the Group to achieve by the framework of the its goals regarding International Integrated performance and sustainable Reporting Council (IIRC). development. This report offers a synthetic presentation of the Avril Group As part of deliberate efforts and its identity: our model, our to ensure dialogue and governance and our strategy to long-term progress, this create value. Its preparation document is intended for was the result of collaborative all our stakeholders, efforts that involved numerous and particularly our Group entities and support shareholders in the farming functions in a global approach world, our customers and to performance – financial, our consumers, our economic, social and employees and our partners environmental. (notably suppliers and NGOs). CONTENTS 2 3 AVRIL — ANNUAL REPORT 2018
AVRIL TODAY OUR STRATEGY P. 16-29 P. 36-57 P. 16 Avril, cultivate tomorrow P. 36 Avril 2023, responding to the demands P. 17 A model that is... of our customers and consumers P. 18 A group structured around P. 37 4 strategic areas to serve a sustainable agricultural and industrial sectors and competitive model P. 20 35 years of sustainable growth at P. 38 Strategy and CSR an integrated vision the service of a virtuous farming model P. 39 The Spring approach: P. 22 Two complementary activities sustainability progress index to serve Avril’s mission P. 40 Sustainable development P. 24 Tailor-made governance P. 42 Area 1 Preparing the future with strong roots in agriculture P. 46 Area 2 Developing specialties P. 28 Avril, a group committed to the sustainable valorization of all P. 50 Area 3 Reducing exposure to risk its resources P. 54 Area 4 Pursuing our transformation
OUR ECOSYSTEM HOW WE SHARE VALUE P. 30-35 P. 58-71
P. 30 Five major trends P. 58 Deciphering the financial P. 31 New consumer demands and extra-financial year P. 32 The demographic challenge P. 62 Sharing value with partners P. 33 Agriculture as a regional bond in our sectors P. 34 The climate challenge P. 64 Sharing value with customers and consumers P. 35 Uncertainty and volatility P. 66 Sharing value to benefit the planet P. 68 Sharing value with our employees P. 70 Sharing value with our stakeholders and society 4 5 AVRIL — ANNUAL REPORT 2018
FROM GRAIN TO OLEO100
Oleo100 is the first energy generated by French agriculture that is 100% plant-based, 100% rapeseed and 100% renewable and traceable. Intended for use by road haulage contractors and local authorities, this new energy can simply replace fossil diesel, achieving equivalent performance and cost. It reduces the emissions of greenhouse gases by at least 60%¹ and those of fine and ultrafine particles by up to 80%².
1. According to ADEME: Analyse du cycle de vie appliquée aux biocarburants de 1re génération consommés en France (Life Cycle Analysis of 1st generation biofuels used in France). 2. Euro 3, source: SAE International. 6 7 AVRIL — ANNUAL REPORT 2018
FROM OLIVES TO THE TABLE
With the acquisition of the Italian family-held company Costa d'Oro, we have become the third largest group for branded olive oil in the world. The aim is to develop our positions in an international market with considerable potential for value creation, based on the integrated sectoral model from upstream agriculture to downstream industry that is our trademark in the oils and proteins sector. 8 9 AVRIL — ANNUAL REPORT 2018
JULIEN LAUNAY Breeder of free-range hens in Côtes-d’Armor. Producer of eggs for Matines and Ovoteam.
FROM ANIMAL NUTRITION TO WELFARE
As a leader in animal nutrition in France, we are involved in several livestock sectors. Aware of consumer demands regarding animal welfare, in 2016 we initiated a progress approach with our partner livestock farmers. We thus developed guidelines on livestock management that are now being implemented by more than 700 farms. We have also supported the conversion of dozens of laying hen units to alternative methods (barn, free range or organic conditions) and our Matines brand has undertaken to supply 100% of alternative eggs by 2025. 10 11 AVRIL — ANNUAL REPORT 2018
FROM SOFIPROTÉOL TO THE FRENCH FARM
Our finance and development arm, Sofiprotéol, benefited from the €100 million increase in capital that was finalized in 2017 in order to improve its capacity to invest in French companies in the agricultural and agribusiness sectors. Its commitments have since included an important contribution to the structuring in France of a non-GM soybean sector by providing support for different actors. 12 13 AVRIL — ANNUAL REPORT 2018
WE REMAIN LOYAL TO OUR UNDERTAKINGS INTERVIEW WITH ARNAUD ROUSSEAU, CHAIRMAN OF AVRIL GESTION, AND JEAN-PHILIPPE PUIG, AVRIL’S CEO
and of innovation and corporate dynamic, but we must remain cautious. responsibility. Quite apart from our We are subject to the external risks five-year strategic plan, these are inherent in agriculture and livestock the ideals we continue to defend. farming, sectors that continue to A. R.: As we did when discussing our experience problems that affect both values in 2013, we are formalizing our customers and suppliers. what were, and will always be, our A. R.: 2018 clearly marked the laying of guiding principles. This collective new foundations for the Group, and the approach creates an internal dynamic resilience of our model is a true reason in which farmers of the “filière” are for confidence. Recovery was less strongly involved. marked from an agricultural point of
ARNAUD ROUSSEAU JEAN-PHILIPPE PUIG view. The situation remains complicated Chairman of Avril Gestion Avril's CEO What is your assessment of 2018? for both the arable and livestock sectors. We have contributed to the debate on A. R.: After a very difficult year in 2017, valorization and the need to upgrade our teams made extraordinary efforts French agricultural and food products. to redefine our goals and priorities But we need to go further. What do for the next five years, and to evaluate What is the idea behind this first traceability or greenhouse gas we want to do with our farming model? our model and our risks, strengths and “Integrated” Annual Report from Avril? emissions, etc. But that is what we have What about French and European food weaknesses. This was a major done since 2012 by determining sovereignty, notably in plant proteins? ARNAUD ROUSSEAU: Presenting Avril this achievement which gave rise to the our activities as a function of these Wherever we are active, development way is wholly in line with what we are: Avril 2023 plan that was validated criteria before even considering their of the French Farm and its local sectors, a company whose model for 35 years by the Board at the end of the year. financial aspects. which is one of the Group’s vocations, has been based on the ideas of growing J-P. P.: In business terms, the year was is central to these questions that require the French Farm, not paying dividends clearly one of two halves. During the Why did you launch a debate on the political responses. and creating value at all levels in the Group’s vision just four years after first half, the Group suffered and it was set up? chain. This is an extremely modern focused on its costs, with particular What were the most important events for Avril during 2018? model that encompasses the notions J-P. P.: We did this in response to emphasis on increased rigor throughout of corporate responsibility and business the organization. The second half was demands from our colleagues: beyond J-P. P.: I can think of at least five. excellence, as well as reflecting all the much more satisfactory. our overall mission, what are the ties The first that comes to mind is the values that drive our activities. These are that unite Avril employees that might acquisition of Costa D'Oro. At a difficult Could you qualify it as a year of recovery? values that are held in common by our also be relevant to all stakeholders in the time, we were nevertheless able to seize shareholders in the farming world, sector? These collaborative efforts have J-P. P.: Certain decisions clarified the this opportunity. As well as this our employees, partners and customers, not yet been completed, but they have horizon regarding strategic regulatory emblematic Italian brand, it is the entire and our consumers. already given rise to the slogan: issues, such as the future for biodiesel olive oil sector that we hope to continue JEAN-PHILIPPE PUIG: Few companies “Cultivate Tomorrow”. It is the idea in Europe between now and 2030 or developing. Terrial and its organic start developing their strategic plan behind these simple words that is support from the French government for fertilizers have become the French by analyzing their impact on criteria such important: a committed vision of our new fuel, Oleo100. These favorable leader within just five years, and now as creating jobs in rural areas, product agriculture, of growth in the sector outcomes have restored a positive offer an important dimension for Avril. 14 15 AVRIL — ANNUAL REPORT 2018
The innovation represented by Oleo100 What was the mind-set when developing shows that it is possible to produce a the new Avril 2023 strategic plan? fuel that is 100% renewable and 100% J-P. P.: We continued our foresight produced by French farmers. As for “This is a fundamental principle for our efforts based on criteria on the livestock sectors, the commitment of contribution of the oilseeds and proteins Matines to alternative eggs is an sector, and CSR criteria, and we Group: those who produce are equally important milestone in the confirmed the principal orientations that implementation of our animal welfare have guided the Group during the past as important as those who buy” policy. We shall be pursuing this dynamic five years: the need for an important of commitment, while supporting ARNAUD ROUSSEAU international presence and the central Chairman of Avril Gestion sectors pragmatically and responsibly role of innovation, with human relations and respecting the efforts of all actors. as their driving force. The most I would also like to mention the Avril important change was to take more Campus, which apart from being an account of customer and consumer architectural exploit symbolizes a needs in our progress dynamic, different way of working together. anticipate their demands and their Finally, we need to remember all the impact on upstream agriculture. We are fully aware of demands from to organize our structure so that we efforts made to improve health and A. R.: Although we are clearly customer- society and will make every effort to can improve our talent management. safety results that were somewhat focused, our primary corporate respond to them. In the area of animal As a group, Avril is only four years old, lacking in 2018. responsibility is to keep our word. welfare, we need to advance more which is very young, but to remain rapidly and become a leader. attractive we must foster the We have made our commitments to development of our colleagues. our partner livestock farmers, and they The Comex for Young People helps trust us in return. Our responsibility us to respond to the needs of the is to support them, work with them to new generation. find alternative solutions and funding and help them to adapt to rapidly What are your thoughts about the future? changing markets. This is a fundamental J-P. P.: We are still in an unstable principle for our Group: those who position, with uncertainties linked produce are equally as important to our political and social environment. as those who buy. However, these years of crisis have given us confidence: we have the talents You place great emphasis on human we need, considerable work has been relations in the Avril plan. What progress carried out on the strategic plan, and has there been in this area? “We take more account our governance bodies and partners J-P. P.: We have produced a formal code have renewed their trust in us during of customer and consumer needs of ethics and good practices which has a difficult period. been explained clearly and sent to the A. R.: The problems we have in our progress dynamic” homes of all employees. The Executive encountered, as well as current and Committee and I ensure that all our future questions, make our model even JEAN-PHILIPPE PUIG actions are consistent with our values. more relevant. Avril’s raison d'être offers Avril’s CEO This is also the reason why we attract a real opportunity, even in terms of new recruits. Furthermore, we continue international visibility and reputation. 16 17 AVRIL — ANNUAL REPORT 2018
A MODEL THAT IS…
AVRIL …HUMAN We believe in the uniqueness TODAY of each person’s talents. The diversity of our activities and the regions where we operate draws strength from our values of Respect, Boldness and Performance.
…FINANCIAL We reinvest most of our profits in the development of the oils and proteins sectors. AVRIL, …FOR GROWTH CULTIVATE TOMORROW We disseminate our know- how and cultivate new sectors beyond our historic activities, in order to create sustainable value in new markets and new regions. Our mission To create sustainable value in the …FOR INNOVATION vegetable oils and proteins sector, thus Throughout the oils and proteins contributing to better food for humans sectors, we give priority to new and preservation of the planet. ideas and to research, €6,091 M 22 thus serving agricultural, food Who are we? turnover in 2018 countries and energy transitions. The Group was set up in 1983 at the initiative of farmers in order to assure …FOR ALLIANCES long-term markets for the production Central to our performance is of French oilseeds, notably rapeseed our role as a partner and investor and sunflower. in innovative and responsible In 35 years, Avril has become a major 7,49 0 59 companies active in a variety employees industrial sites of agricultural, agrifood and industrial and finance group, present in in France agribusiness sectors. France and internationally in a variety …FOR ACTION of activities both upstream and We act today in order to better downstream in the sector. It draws prepare tomorrow, working strength from a portfolio of strong closely with all our stakeholders brands such as Sanders, Lesieur, 84 in order to transform Puget, Costa d’Oro, Bunica, Matines, industrial sites our sectors at each level throughout Taous, Diester or Oleo100, etc. in the value chain from the world consumers to producers. Its sectoral organization is consistent with the current and future challenges faced by agriculture. AVRIL TODAY 18 19 AVRIL — ANNUAL REPORT 2018
A GROUP STRUCTURED AROUND AGRICULTURAL AND INDUSTRIAL SECTORS
ers & consu Custom mers Upstream Plant sectors
ggs agriculture E M ilk , m farmers e ock at st ive L health cs and eti gen A sectoral structure was one of Avril’s Upstream in the sector, the grain is al m ni tion A nutri P al o founding principles. Starting from grain crushed to obtain oil on the one hand im An u lt r and its two inseparable by-products, oil and protein on the other. Raw or refined, otein y Pr s
and protein, the Group has developed the vegetable oils can be used for a
a broad range of activities in the plant wide variety of applications: table oils, h Crus ing k and animal worlds that work in synergy sauces and condiments, ingredients r o from upstream to downstream. Under for the agrifood and health industries, P this original model, Avril maintains close renewable energies and oleochemical Co lle relations with its partners in upstream molecules that are found in a large ct io Human foods s n s e d ic o (vegetable proteins) agriculture, both grain producers number of everyday products. e v f e r e o S s i l (who are also its shareholders) and s • d 110,000 e y n
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y r t is Oils m e The solid part of grain is mainly oilseed Through the investment activities of h c o meal that is rich in vegetable protein its finance and development company le O and used as feed for farmed livestock. Sofiprotéol, Avril is also present Renewable Avril has developed considerable upstream in the seed, biotechnology, energy expertise in different livestock sectors animal genetics and health and grain and become involved in the processing collection sectors, and downstream and sale of animal products. The Group in initial grain processing and mass- also works on valorizing the protein marketed food products. C s ustomers & consumer fraction of grain for use in protein chemistry and human foods. AVRIL TODAY 20 21 AVRIL — ANNUAL REPORT 2018
35 YEARS OF SUSTAINABLE 2016 Deployment of the sustainable GROWTH AT THE SERVICE OF development policy throughout the Group’s activities and formalization of its A VIRTUOUS FARMING MODEL policies in favor of sustainable palm oil. 2015 The Avril 2020 strategic 2017 plan lays the foundations of By joining the United Nations 2012 the Group’s transformation Global Compact, Avril The CAP 2018 strategic plan oriented towards reaffirms its desire 1983 marks a turning point in the customers, international to contribute to attaining Farmers in the French development of specialty growth, innovation and global sustainable oilseeds and protein products with a global vocation a collective project. development goals. crop sector develop a and integrates a CSR dimension Avril becomes involved Publication of a code collective industrial and 2010 through five commitments in exploiting the protein of conduct for suppliers financial tool. Sofiprotéol Creation of the Sustainable associated with indicators that fraction of grain. and of policies in favor is thus born of a vision of Development Department reflect quantified goals. of animal welfare. sustainable development with the aim of developing for agriculture, according a shared vision of the CREATION to a model of reinvesting company’s corporate profits in the sector. responsibility. 2018 The Group consolidates a new strategic plan, Avril 2023, supported by a reinforced CSR framework Sofiprotéol ACQUISITION becomes GERMANY based on five pillars and deployed in 14 themes. The Group initiates an integrated reporting approach. ACQUISITION BELGIUM
ACQUISITION ACQUISITION 2009 BRAZIL FRANCE ACQUISITION ROMANIA 7,281 8,372 6,445 ACQUISITION 6,531 Turnover (€M) FRANCE 8,200 6,105 6,230 2007 6,512 5,905 6,091 CREATION Employees ACQUISITION 7,200 7,600 7,200 7,490 5,360 FRANCE ACQUISITION ACQUISITION 6,352 LA RÉUNION ACQUISITION ALLIANCE 2004 FRANCE ITALIA Avil and Suez join forces in ACQUISITION FRANCE 2003 CREATION CREATION CREATION CREATION ACQUISITION ACQUISITION ACQUISITION MOROCCO SENEGAL UNITED KINGDOM
CREATION 1996 INAUGURATION ACQUISITION of the Avril GERMANY CREATION campus 1990
1983 2010 2011 2012 2014 2015 2016 2017 2018 2019
The early Acceleration of Group growth, driven by biodiesel Diversification towards activities with higher added value foundations of Avril AVRIL TODAY 22 23 AVRIL — ANNUAL REPORT 2018
TWO COMPLEMENTARY ACTIVITIES TO SERVE AVRIL’S MISSION
1. Industrial activities organized in four Business Avril Vegetal Avril Livestock Sectors Avril Specialties Avril Development Lines covers, firstly, the processing of groups activities in livestock reflects the shift of Avril’s Primarily focused on circular rapeseed and sunflower grain nutrition – where Avril is the activities from commodities economy, this business line (crushing, esterification, refining) leader in France – and the towards high added includes high-potential activities and sale of the resulting products processing and sale of pork value products. It groups having in common a start-up (protein-rich oilseed meals, oils, and eggs. This Business Line oleochemicals, plant-based spirit: processing of by-products biofuels, vegetable glycerin), and capitalizes on the diversity renewable chemicals, animal from the agrifood industry, secondly the production and sale of its activities from upstream specialties and innovative recycling organic waste into of table oils and condiments. to downstream in order to nutrition and hygiene solutions fertilizers, and the purchase offer improved traceability for livestock farmers worldwide. of raw materials for other for consumers. companies.
€3,998 million €1,669 million €868 million €77 million turnover turnover turnover turnover 3,097 2,303 1,577 75 employees employees employees employees
2. Investment activities €230 million SOFIPROTÉOL invested in 5 years As Avril’s investment and development arm, Sofiprotéol supports companies in the French and European agriculture €48 million invested in 2018 and agrifood sectors through minority stakes and loans. 19 employees AVRIL TODAY 24 25 AVRIL — ANNUAL REPORT 2018
TAILOR-MADE GOVERNANCE THE BOARD WITH STRONG ROOTS OF AVRIL GESTION IN AGRICULTURE
FIDOP FOP FARMING WORLD ARNAUD ROUSSEAU Farmer, Chairman of Avril Gestion, Chairman of the FOP SÉBASTIEN WINDSOR ALAIN RENOUX EMPLOYEES AVRIL GESTION Farmer, Vice-Chairman of the FOP, Farmer, Chairman of Terres Inovia ³ Vice-Chairman of the FOP
INVESTMENT ACTIVITIES INDUSTRIAL ACTIVITIES: 4 BUSINESS LINES
AVRIL AVRIL AVRIL AVRIL BENJAMIN LAMMERT JEAN-PIERRE DENIS ANNE LAUVERGEON VEGETAL LIVESTOCK SECTORS SPECIALTIES DEVELOPMENT Farmer, Chairman of Crédit Mutuel Arkea CEO of ALP Services Member of the Board of the FOP and Crédit Mutuel de Bretagne and Chair of Sigfox
A singular model needs original The additional presence of the governance. In 2015, the Avril Group Fondation Avril (recognized as PIERRE PRINGUET SYLVIE RUCAR YVES DELAINE equipped itself with the legal status of Vice-Chairman Consultant Former deputy CEO a public utility) among the shareholders a limited partnership with share capital of Pernod Ricard of Avril Group (Société en Commandite par Actions, SCA) guarantees a long-term vision to preserve the long-term future of and ensures the continuity of its founding principles. the Group’s mission, broadened to include societal challenges. By separating the power of the limited The partners work through a Chaired by Arnaud Rousseau, a farmer to deal with important challenges: partners or associés commanditaires Supervisory Board and the manager and Chairman of the FOP, the Board four farmers from the FOP, three which (include the FIDOP1, FOP2 and the operates through the Board of Avril of Avril Gestion appoints the manager qualified personalities from the Fondation Avril) from that of the Gestion. Governance focuses on of the SCA and decides upon major financial, industrial and agrifood worlds manager (Avril Gestion, the general long-term valorization, as the Avril strategic and financial orientations and two of the Group’s former CEOs partner or associé commandité), this Group always reinvests most of its before their implementation by the or corporate officers. The Board meets governance structure contributes to profits in the development of the oils Executive Committee. This Board at least once a quarter to examine and ensuring that the founder shareholders and proteins sectors. comprises nine members with validate Avril’s budgets, investments – farmers in the sector – remain central complementary skills, and the diversity and financial situation. to Avril’s plan and ensure its 1. Interprofessional Development Fund for the Oilseeds of their profiles feeds the strategic and Proteins Sector. 3. Technical Institute for Oilseed Crops, transmission to future generations. 2. French Federation of Oilseed and Protein Crop Producers. vision of the Group and enables it Grain Legumes and Industrial Hemp. AVRIL TODAY 26 27 AVRIL — ANNUAL REPORT 2018
THE EXECUTIVE COMMITTEE THE FONDATION AVRIL GOVERNANCE Recognized as a public utility in December HIGHLIGHTS IN 2018 2014 when it was set up, the Fondation Avril is one of the few such foundations to hold shares in a French corporation.
Its vocation is to fund community projects Updating of CSR policies at the heart of rural France, as well as With respect to sustainable palm driving a certain number of projects oil, animal welfare and responsible itself. For the next few years, its actions purchasing, Avril pursued the structuring of its CSR policies in JEAN-PHILIPPE PUIG in France have been redirected towards Chairman and Executive Officer the form of progress initiatives. (CEO) supporting the transition of farming MICHEL BOUCLY GABRIEL KRAPF models with particular emphasis on three Deputy CEO Vice President for Industrial & International Development main themes: • Supporting the diversification of Circulation of an ethical code agriculture to create social and A code for ethical conduct was economic value in different regions, formalized and sent out to the homes of all employees. It presents the • Reinforcing the links between standards with which all employees agriculture and society, and must comply in their everyday activities • Promoting healthy and sustainable foods and relationships with others. made using high quality products. In Africa, the Fondation Avril is pursuing its efforts on preserving soils and cultivated biodiversity through the development of AYMERIC MONGEAUD STÉPHANE YRLÈS MOUSSA NACIRI Sustainable performance Chief Financial Officer (CFO) Secretary General General Manager of the Avril different sectors. indicators Specialties Business Line Avril created an index called “Spring” which will use a synthetic score (out of 5) to measure progress in the CSR approach throughout the duration of the Avril 2023 strategic plan. THE SUPERVISORY BOARD Dialogue with stakeholders This Board has nine members: Organization of events for regional six representatives of the limited officials and farmers within the OLIVIER DELAMÉA PAUL-JOËL DERIAN MARIE DE LA ROCHE partners, two staff members from Group’s facilities; these include site General Manager of the Avril Vice President KERANDRAON visits, meetings with employees Vegetal Business Line for Innovation, Research & Vice President for Human Resources the Avril Group elected by their and a presentation on Sustainable Development and Communications peers and one member with a the challenges faced by the oilseeds right of discussion only, appointed and proteins sector. by the economic and social union to which Avril belongs. Chaired by Antoine Henrion, who is also Comex for Young People Chairman of Terres Univia (the Avril’s Comex for Young People Interprofessional Organization for appointed its second group of members Appointed by the Board, managers from the Group’s four Oilseeds and Protein Crops), the for two years. Sixteen employees Jean-Philippe Puig, CEO of the Avril Business Lines and Sofiprotéol, mission of the Supervisory Board below the age of 35 thus joined the Group since 2012, is backed by its finance and development company, is to ensure ongoing control of the Committee from different entities, activities and countries of the Group. the Executive Committee (Comex), as well as from Avril’s main support Group’s management, and for this The vocation of this Youth Comex is to the Group’s management body which functions. The Comex has four purpose it has the same powers as ensure active participation of the new meets every two weeks. The Comex subcommittees focused on Careers, the statutory auditors. generation of managers in Avril’s future. has nine members who are senior Risk, Investments and Strategy. AVRIL TODAY 28 29 AVRIL — ANNUAL REPORT 2018
AVRIL, A GROUP COMMITTED TO THE SUSTAINABLE VALORIZATION OF ALL ITS RESOURCES
OUR RESOURCES OUR STRATEGIC MODEL VALUE CREATED
AN RH POLICY TO SERVE COLLECTIVE PROJECTS OUR HUMAN RESOURCES • Safety, the no. 1 priority: Group TF2 at 10.9 • 7,490 employees working in 22 countries AC TIV R ITI • Integration of young people: 351 people in alternating training • 29% of women in the Group’s total workforce U ES O or in internship in 2018 (France) • 3 Group values: Respect, Boldness, Performance • Management of key skills: average of 16 hours of training per O ITI R FTE (France) TR TI R L R A OUR UPSTREAM AGRICULTURE A I L STRONG REGIONAL ROOTS IN FRANCE AND INDUSTRIAL SITES I D AND INTERNATIONALLY • 110,000 oilseed and protein crop producers in France A A • A sectoral organization in France, Romania, Morocco • 26,000 partner livestock farmers in Avril Livestock Sectors OUR MISSION and Tunisia • 200 olive producers supported by Lesieur Cristal • 20,000 jobs (direct, indirect and induced) in the biodiesel • 84 industrial sites spread throughout 22 countries To create contribute to sector1; 45,000 direct and indirect jobs linked to activities
• €123 M de CAPEX en 2018 2 R in Avril Livestock Sectors
sustainable better food for
value in the oils humans and
and proteins preservation of FINANCIAL RESULTS TO SERVE A UNIQUE MODEL AND OUR FINANCIAL RESOURCES THE DEVELOPMENT OF SECTORS FOR THE FUTURE A sectors, the planet. • €1,800 M equity D • Turnover: €6,091 M • €244 M commitments by Sofiprotéol L O • EBITDA: €153.5 M O • 103 companies supported (loans and stakes) by Sofiprotéol • €2.5 M to the Fondation Avril A OUR PLANET I • 3.6 Mt of grain (rapeseed, sunflower, soybean) crushed T AN IMPROVEMENT TO ENVIRONMENTAL BALANCES by the Group's industrial facilities. 11.5 kt olives crushed R Y AND THE OPTIMAL VALORIZATION OF RESOURCES by Lesieur Cristal in Morocco • Reduction achieved in GHG emissions by Saipol biodiesel • 94% of renewable materials (vegetable oils and animal versus fossil diesel: 59.8% fats) used in oleochemistry • Biosourced oleochemical products (replacing petroleum- • 3,390 GWh energy consumed I V T T derived products): 629 kt • Percentage of renewable energies in total energy consumption: 29 %
OUR INTELLECTUAL CAPITAL: BRANDS AND INNOVATION CAPACITIES 4 STRATEGIC AREAS INNOVATION, A LEVER FOR VALUE CREATION • Brands recognized as leaders in their markets: Diester, AND TRANSFORMATION Oleo100, Sanders, Lesieur, Puget, Costa d’Oro, Matines, • Development of organic product ranges and promotion Bunica, Taous 1 2 3 4 of non-GM products to benefit French sectors • Strong areas for innovation: proteins, foods, new Preparing the Developing Reducing Pursuing our • Direct positive impact of innovation in the Avril 2023 strategic energies, biotechnologies, etc. future specialties exposure to risk transformation plan: 1/3 of growth in the EBITDA between 2018 and 2023 • More than 350 patents and filings ongoing will be linked to innovation projects.
1. Source: PricewaterhouseCoopers (PwC) report – 2013. 2. Source: in-house estimate based on the production of Sanders partner livestock farmers and data from the study on jobs linked to French livestock farming (GIS Élevages Demain 2015). 30 31 AVRIL — ANNUAL REPORT 2018
OUR ECOSYSTEM
NEW CONSUMER DEMANDS
Five major trends A rapidly-changing picture FOR AVRIL Because of its mission, its roots in Consumers are now increasingly The challenge inclined to adopt sustainable upstream agriculture and livestock To reconcile these demands with consumption modes and are the need to feed the planet. farming and its sectoral model, Avril developing greater awareness naturally needs to respond to key to the environment and farming The response practices. These expectations • Avril’s sectoral model guarantees societal challenges. The Group has are expressed in a variety of the traceability of its products identified five major trends that ways: healthy, natural or organic and can restore consumer trust. products of national or even local characterize the world in which it • The Group has acknowledged origin that will not harm health or expertise in supporting livestock operates with its stakeholders. This the planet and will respect animal farmers to respond to these complex and ever-changing ecosystem is welfare, etc. new trends (demedicalization, animal welfare, short marketing the source of both challenges to be met Europe in pole position channels, etc.). and growth opportunities to be seized. From a regulatory standpoint, • Avril develops sectors of All these trends address the agricultural Europe is now much more excellence and supports the stringent than other continents conversion of farms. and agrifood model that is central to the (Americas and Asia) regarding Group’s activities. Avril is convinced that sustainability criteria. agriculture must and can evolve so as to make a positive contribution to the +84% of Europeans will prefer foods future and respond to new demands that are good for their health in the coming years. from society and its stakeholders. Source: Cetelem Observatory, 2013. OUR ECOSYSTEM 32 33 AVRIL — ANNUAL REPORT 2018
THE DEMOGRAPHIC CHALLENGE AGRICULTURE AS A REGIONAL BOND
10 billion inhabitants by 2050 FOR AVRIL Rural areas seeing a loss FOR AVRIL of growth This is the primary component of The challenge The challenge In France, the decline of periurban global food issues and account To produce more and better using To restore local value and links and rural areas in recent years has must be taken of a dual evolution: fewer resources. between different regions. economic development and growing resulted in the disappearance of urbanization of the middle classes, The response public services, small retailers, The response notably in Asia and Africa. • By exporting its sectoral model, Avril banks, public transport and • The Group’s ambition is contributing to the sustainable hospitals, etc. In parallel, agriculture is to restore value and Greater demand for food structuring of agricultural has continued to suffer: a sustained competitiveness to the French In terms of both quantity (according production, notably in Africa. downturn in the number of farms, Farm. to the FAO, +60% between now • Its Sustainable Health aging of the population and a drop • A national network in contact and 2050) and quality, thanks to Management approach enables in income levels. with the Group’s 26,000 partner a rise in purchasing power and optimization of the performance livestock farmers. more stringent demands from of livestock units. Regionally responsible companies • Through its subsidiary different populations. This trend • The Group is driving an ambitious Recent events have demonstrated Sofiprotéol, an increase in is accompanied by an increasing strategy of innovation in an increased need for social and investment in French agricultural demand for vegetable proteins vegetable proteins. regional cohesion. Companies are and agrifood sectors. in all countries. • Avril is an actor in the circular above all local actors and have economy, based on synergies essential corporate responsibilities between its different activities. in the areas where they operate. They can become a key element in restoring local communities. 51% of people in rural areas feel “abandoned”. +43% +100% Source: IFOP Survey of Rural Families in global demand for vegetable growth in demand for food in Africa and in October 2018. proteins between now and 2030. Asia between now and 2050. Source: BIPE Study 2015. Source FAO. OUR ECOSYSTEM 34 35 AVRIL — ANNUAL REPORT 2018
THE CLIMATE CHALLENGE UNCERTAINTY AND VOLATILITY
Responsibilities of companies FOR AVRIL A new working framework FOR AVRIL and local communities Summarized by the acronym VUCA The challenge The challenge The urgency of the situation requires To reduce the impacts of (Volatility, Uncertainty, Complexity, The current context requires widespread mobilization, notably agriculture and make it a solution Ambiguity), a concept inherited from caution and consistent skills in by the towns and companies that to climate issues. the US Army, the world at present understanding, anticipating possess certain levers to slow the is characterized by perpetual and adapting. warming of our planet. Agriculture, The response change and particularly its growing industry and transport contribute to • Avril is committed to reducing unpredictability. The response climate change and to the solutions its own industrial impacts. • Operating in a difficult context that can be implemented to limit it, • The Group supports its partners Numerous questions concerning in recent years, the Group has and these are three sectors where in making changes to arable and the future demonstrated the resilience Avril is an active operator. livestock farming practices. In a hyper-connected world, of its model. • Avril innovates by proposing new companies are subject to • Reducing exposure to risk is Focused European policies energy sources (Oleo100) with increasingly complex risks affecting an important component in In 2018, Europe defined a 2030 a high capacity to reduce GHG political, regulatory, economic and the Avril 2023 strategic plan. goal for renewable energies used in emissions1. social ecosystems. • Avril works to improve flexibility transportation and confirmed the role What will be the future implications of throughout its organization that must be played by agriculture in trade agreements and Brexit, the role (simplification, shorter decision achieving this objective. of renewable energies in transport circuits, etc.). and domestic use, or the CAP?
Volatility: Ambiguity: the variability the difficulty to control +1.5°C +14% of situations. cause-and-effect relationships. is the limit that must not to be of renewable energies to be used for Uncertainty: Complexity: exceeded according to the transport in Europe by 2030. the impossibility to predict an increasing number of interactions Paris Agreement. beyond a few months. within the same system.
1. Greenhouse gas 36 37 AVRIL — ANNUAL REPORT 2018
4 STRATEGIC AREAS TO SERVE A SUSTAINABLE AND COMPETITIVE MODEL OUR STRATEGY
AVRIL 2023, RESPONDING TO THE Preparing the future Developing specialties Innovating to respond Reinforcing activities DEMANDS OF OUR CUSTOMERS to the demands of customers, with high added value consumers as well as to expand into new markets and AND CONSUMERS partner farmers. to maintain international growth.
The guidelines laid down in Avril 2023: REAFFIRMING AVRIL’S MISSION • A mission that is central to Avril’s business model: the levels of contribution to sectoral “In 2018, each activity performed a foresight study on development and the corporate responsibility its work. Once shared, the results gave rise to Avril 2023, of different Group entities modulate their a plan confirming the pertinence of the strategic levers economic and financial objectives. implemented in 2015: the development of specialties and • A new sectoral approach according to the innovation, pursuit of the Group’s consolidation and principle of a pull flow system based on transformation and the conquest of new markets changes to customer and consumer demands and regions. Avril 2023 is thus wholly in line with these in the future (sectors of excellence, traceable commitments and aims to respond to the changing products, French origin, animal welfare, Reducing Pursuing our demands of the Group’s customers and consumers and carbon efficiency, etc.) and their implications exposure to risk transformation their implications for upstream agriculture. It is based on cautious scenarios that take account of market for upstream agriculture. Gaining in industrial Keep on developing talents, uncertainties but without losing sight of the Group’s • Projections based on cautious scenarios and environmental performance, implementing tools to share a common mission, which is to create sustainable value in the oils that take account of uncertainties in securing commodity activities, corporate culture, continue with and proteins sectors and thus contribute to better food particular markets and environments. improving safety of persons. the modernization of industrial assets. for humans and preservation of the planet.” • Company values and plans that give a sense to the commitment of employees: to contribute to inventing sectors for the future within a Group that reinvests almost all its profits in accomplishing its mission.
Michel Boucly, Deputy CEO OUR STRATEGY 38 39 AVRIL — ANNUAL REPORT 2018
STRATEGY AND CSR THE SPRING APPROACH: AN INTEGRATED VISION SUSTAINABILITY PROGRESS INDEX
The Avril Group was built just over With its 2023 plan, Avril is reinforcing its strategy not only in terms of its design 35 years ago on two main principles: CSR approach, first formalized in 2010 with but also its execution. a general interest mission to serve the creation of the Group’s Sustainable AN EXTRA- An index called “Spring” will therefore France’s independence in vegetable Development Department. proteins and a decision not to distribute FINANCIAL use synthetic scores out of five to dividends to its shareholders but reinvest ANALYTICAL A new CSR framework will accompany measure progress in the CSR approach almost all of its profits in the sector. these strategic orientations, based on throughout the period of the plan. In TOOL TO SERVE five pillars that reflect the Group’s This makes it an atypical business model. 2019, Avril will be publishing its first mission and are deployed under Furthermore, from the start in 1983, THE GROUP’S mandatory Statement on Extra-Financial 14 themes. This program will drive the Avril’s mission was already focusing on O BJ ECTIVE S Performance and has merged its two Group regarding some fifty indicators, developing the sector and protecting the reports – Activities and Sustainable twenty-five of which include 2023 goals. planet. In 2018, Avril made a choice to Development – into a single Annual CSR provides a framework for Avril’s introduce a single governance structure In the context of the strategic integrated Report. for its RID1 and sustainable development, plan, an extra-financial analysis of thus indicating its awareness of the rapid industrial operations is performed changes ongoing in its environment to position each activity according and of consumer demand for more to Avril’s mission. This mapping is THE FIVE PILLARS OF OUR APPROACH sustainable agricultural products and designed around two key areas: practices; today, the CSR dimension • contribution to the Pillar 1 forms an integral part of the Group’s development of the oils and Our value chains innovation process. proteins sectors: value creation, Participate in developing and strengthening markets for oilseed and protein sustainable value chains Avril’s strategic and financial grain, share of traceable/certified management illustrates its sustainable products; Pillar 5 Pillar 2 development approach: based on criteria Our stakeholders Our products & services relative to its contribution to developing • contribution to the Group’s Corporate Social Responsibility: Engage with our Respond to demands for the French oilseed and protein sectors stakeholders quality and sustainability food production, GHG emission and on CSR, the Group classifies its from customers and levels, innovation, job creation, activities, drives its choices (acquisitions, consumers new activities, etc.) and fixes its development in emerging countries. profitability goals. Pillar 4 Pillar 3 Our people Our planet This analytical approach, introduced Cultivate our values to work Protect the planet initially in 2012, was naturally used better together and its resources for Avril 2023 and enabled the determination of performance goals
for each sector. Sustainability Progress Index: an indicator of sustainable performance The Spring index is a global score which are based on a selection 1. Research, Innovation, Development. resulting from the unweighted of 25 key indicators. average of five scores (one per pillar) OUR STRATEGY 40 41 AVRIL — ANNUAL REPORT 2018
SUSTAINABLE DEVELOPMENT 2023 COMMITMENTS AND OBJECTIVES OBJECTIVE OBJECTIVE OBJECTIVE Work with Sanders partner To develop the use of recycled To improve the integration livestock farms to support PET plastic of disabled employees within their transition towards the Group alternative eggs. VALUE 2018 22.4% of recycled PET VALUE 2018 VALUE 2018 used by Lesieur 38% of the Group’s companies 17 SUSTAINABLE DEVELOPMENT GOALS (SDG) WERE DEFINED BY THE of laying hens living 27.2% in France employ at least 6% under cage-free systems 2023 TARGET UNITED NATIONS IN THE CONTEXT OF THE 2030 AGENDA, AN AMBITIOUS ≥50% of recycled plastic used by of disabled people 2023 TARGET Lesieur in 2023 for its branded GLOBAL PROGRAM FOR PROGRESS. IN VIEW OF ITS ACTIVITIES, AVRIL To be defined in 2019 2023 TARGET packaging To be defined in 2019 CAN CONTRIBUTE TO ACHIEVING SEVERAL SDGS WHICH WERE IDENTIFIED WHEN THE NEW CSR FRAMEWORK WAS COMPILED FOR THE GROUP. PILLAR 3 PILLAR 4 PILLAR 5 OUR PLANET OUR PEOPLE OUR STAKEHOLDERS
OBJECTIVE OBJECTIVE OBJECTIVE To progress each year in terms To reduce the number of injuries To structure the Group’s dialog of energy consumption and TF2 by 50% between now with stakeholders, notably and 2023 VALUE 2018 through a special committee 3.39 GWh VALUE 2018 2023 TARGET 2023 TARGET TF2 = 10.9 Two meetings of the committee Target per tonne of products 2023 TARGET each year to be defined in 2019 TF2 ≤5.4 PILLAR 1 PILLAR 2 OUR VALUE CHAINS OUR PRODUCTS & SERVICES OBJECTIVE OBJECTIVE To progress each year in terms To ensure one-third of women of water consumption OBJECTIVE OBJECTIVE among Group employees in 2023 To crush each year a high To use palm oil that is certified OBJECTIVE VALUE 2018 percentage of French grain or covered by RSPO credits 3 To achieve a 65% reduction in 7.9 MILLION M (rapeseed/sunflower) VALUE 2018 GHG emissions with Saipol’s 2023 TARGET in Saipol’s industrial facilities 29.1% VALUE 2018 biodiesel versus the reference Target per tonne of products to 2023 TARGET 94.7% fossil diesel be defined in 2019 VALUE 2018 ≥33 % of supplies covered by 69.2% certification or RSPO credits VALUE 2018 Since July 2017, Avril 59.8% 2023 TARGET 2023 TARGET has been a signatory 1 To be defined in 2019 2023 TARGET OBJECTIVE >90% each year OBJECTIVE of the United Nations ≥65% To increase the share of To ensure one-third of women renewable energies in total Global Compact, thus among the Group’s top energy consumption affirming its desire to managers in 2023 OBJECTIVE OBJECTIVE contribute to achieving To supply each year the animal OBJECTIVE VALUE 2018 To invest €370 M between 29% VALUE 2018 the UN’s Sustainable nutrition industrial facilities 2019 and 2023 via Sofiprotéol, To achieve 100% compliance 25% operated by ALS with more than by livestock units audited under 2023 TARGET Development Goals. the Group’s finance and 2023 TARGET 80% of French raw materials internal livestock management To be defined in 2019 Within two years development company ≥30% guidelines of signing, Avril had VALUE 2018 81.3% VALUE 2018 VALUE 2018 qualified its annual €48.5 M 2 96.8% OBJECTIVE Communication on 2023 TARGET spent during the year (compliance as from To recycle more than 95% of OBJECTIVE >80% each year Progress (COP) at the 2023 TARGET the first audit) industrial waste at a Group level To achieve 8% of young people in internships or alternating highest, Advanced, €370 M over the period 2023 TARGET in 2023 2019-2023 training in the workforce level of reporting, 100% of non-compliance VALUE 2018 registered in 2023 addressed within the period in France which is only achieved 96.2% stipulated 2023 TARGET VALUE 2018 by 8% of companies. >95% at Group level 7.5% in France 1. Because 2018 was a year of transition for the Group’s CSR approach, some targets will be fixed in 2019. 2. Laying hen units, Sanders partners under contract. 2023 TARGET >8% in France OUR STRATEGY 42 43 AVRIL — ANNUAL REPORT 2018
AREA 1
PREPARING THE FUTURE
FOR AVRIL, INNOVATION IS A LEVER FOR VALUE CREATION AND TRANSFORMATION AND A SOURCE OF NEW MARKET OPPORTUNITIES.
It is essential to innovate in order to Proteins and biotech, breakthrough construct a sectoral model for the future innovations that will better meet the quality and For the past three years, the Group has sustainability demands of customers been working on valorizing the protein and consumers, while at the same time fraction of grain. One of the most offering new solutions. advanced projects is the new activity of proteochem® (protein chemistry). AVRIL GROUP A multifaceted approach to innovation In 2019, Evertree will be entering its that will serve the Group’s mission commercialization phase. This start-up ORGANIC ON ALL FRONTS From the start, for Avril, its sectors ticks all the boxes for innovation, added and the farming world, innovation value and sustainable development, was a lever for value creation and in that it uses rapeseed protein to From upstream to downstream, in 2018) and by drawing strength transformation and a source of new replace the chemical products usually Avril is conducting several projects from its acquisition of Costa D'Oro, market opportunities. In-house RID, employed in the manufacture of wood- on organic sectors in response to this Italian leader in the organic olive oil joint research efforts with other actors based panels. This first alternative strong consumption trend that is giving market (see p. 49). in the sector, partnerships within to current products will be on the new potential to agricultural production Livestock sectors are also affected industrial consortia or with start-ups, market in 2019, enabling a significant and practices. Associated with Suez by this trend. Upstream, Avril aims stakeholdings taken by the finance reduction in the presence of synthetic through its subsidiary Terrial since to become the leader in organic and development company Sofiprotéol, or chemical resin in the panels, and in early 2019, Avril is already confirmed livestock feeds. By deploying its and contributions to innovation capital the air pollution linked to the volatile as the leader in organic fertilizers organic offer throughout France, funds, etc.; the Group has adapted organic compounds (VOC) generated in France. The new joint enterprise Sanders achieved 42% growth in order to foster shape-shifting by the resins. aims to offer a complete range of in this segment in 2018. Downstream, innovation involving different sources Another application of research on fertilizers and soil improvers that Matines is now committed to and resources. vegetable proteins is rapeseed protein notably target farms for their use. supplying 100% alternative eggs In line with the environmental and concentrates for use in animal nutrition; The Group is accelerating the by 2025, 20% of them produced societal undertakings of the Group, in the future, these could constitute an development of its organic oils organically. Finally, Avril supports several transversal projects are alternative to the fish and soybean meals and condiments under the Lesieur its partner livestock farmers in contributing to preparing the future. used as feed in aquaculture. and Puget brands (four new products converting their farms (see p. 65). OUR STRATEGY 44 45 AVRIL — ANNUAL REPORT 2018
AVRIL SPECIALTIES TO INNOVATE IN ORDER TO CONSTRUCT A SECTORAL MODEL FOR THE FUTURE ANIMAL BIOCONTROL THAT WILL BETTER MEET THE QUALITY AND BY NOLIVADE SUSTAINABILITY DEMANDS OF CUSTOMERS AND CONSUMERS, WHILE AT THE SAME TIME A start-up acquired by Avril in 2014, Nolivade develops alternatives to the OFFERING NEW SOLUTIONS. preventive use of antibiotics by livestock farmers. Its expertise is to develop and assemble beneficial bacterial flora such as the Certiflore solution, which is designed to limit the proliferation of pathogenic agents on the feet of ruminants and thus prevent lameness. This innovation that is now available in forms suitable for poultry and pigs. Other specialties are being prepared for market with respect to digestive health. The Group is also pursuing its work the role of Terrial in organic fertilizers, on new generations of sunflower and as well as activities in animal nutrition, rapeseed-based proteins for future eggs and olive oil (see p. 43). applications in human foods. Following the same logic, and aware The focus on biotech started in of the societal challenges linked to 2015 regarding the demedication of livestock farms, Avril has pursued its livestock units. Avril’s start-up Nolivade progress initiative on animal welfare has made a further contribution to (see p. 64). This policy is based on preventing diseases and ensuring animal the Sustainable Health Management welfare (see opposite). On its side, approach adopted by Avril several years SOFIPROTÉOL oleochemistry is participating in the ago and now deployed internationally. LIPES1 program, a European project It aims to support livestock farmers in INVESTING that involves a consortium of partners managing their farms and implementing IN AGRICULTURE from both upstream and downstream; practices that favor animal health its aim is to develop a new enzyme- through preventive measures (hygiene, FOR THE FUTURE based technology that is less aggressive biosecurity, feeds) in order to reduce In the context of Avril 2023, one of and energy-intensive than chemical the use of antibiotics. Sofiprotéol’s missions is to support hydrolysis processes. agricultural production under a progress Digital innovations to serve upstream initiative towards more responsible practices, Innovations to respond to demands from agriculture achieved notably through innovation. society Preparing the future also means entering Avril’s investment and development company Among the features of Avril 2023, the era of connected agriculture. has thus taken a stake in De Sangosse, organic products play a significant This has involved major advances in which aims to conquer 30% of the biocontrol role in the Group’s main activities, terms of digital tools and data processing: market for plant protection by developing not so much in terms of opposing a “smartfeed” program for livestock methods based on the use of living organisms conventional methods but responding farmers, the first tool (Canopée) being or natural substances. In addition, Sofiprotéol to increasing demands from customers designed to analyze and exploit livestock has recently invested in a joint research and consumers. An ambition on the management data on-farm, or the program with Terres Inovia that aims to development of organic products blockchain technology which in the develop a pheromone-based biological has been expressed for each activity, near future should enable Matines to solution to control rapeseed pests. involving specific investments in demonstrate to consumers the complete upstream agriculture; for example, traceability of the eggs they are buying.
1. Life Integrated Process for the Enzymatic Splitting of Triglycerides, https://lipes.eu OUR STRATEGY 46 47 AVRIL — ANNUAL REPORT 2018
AREA 2
DEVELOPING SPECIALTIES
Initiated in 2015 in the context of the This new proprietary technology, which previous strategic plan, the development can offer customers highly specific and of specialty products has been top quality applications, should confirm confirmed as a core feature of Avril’s Oleon’s leadership in this market success. Specialties can accelerate segment. As a driver in terms of CSR, changes within the Group: less emphasis it should also be noted that for the on commodities that are dependent on second year running Oleon received an external factors, and more added value EcoVadis Gold rating for its efforts, for the sector. In other words, the aim is notably in the areas of the environment to shift from a volume-based strategy and sustainable purchasing, this score to a value-based strategy that will placing it amongst the top 1% companies provide the Group with the leeway it of its sector rated by this international needs to grow. As the spearhead of this agency. transformation, the Avril Specialties AVRIL VEGETAL Business Line is pursuing its growth in Innovative solutions for sustainable livestock farming oleochemicals and animal specialties, OLEO100: A NEW FUEL two activities that are driven by With the ambition of becoming a AND NEW ACTIVITY FOR AVRIL innovation, an international presence recognized actor in the management and customer proximity. and optimization of the performance of livestock farms, in 2018 Avril Animal The fruit of joint efforts by farmers, also reduces fine and ultrafine particle At the cutting edge of oleochemical Specialties (AAS) passed the symbolic Avril and vehicle constructors, Oleo100 emissions by more than 80%. With technology threshold of achieving 50% of its is a new, 100% plant-based, renewable Oleo100, Saipol has become a direct Oleon, which has just celebrated ten turnover internationally, with an and traceable energy source produced supplier of energy and privileges years as a member of the Group, increasing share of its innovation by French agriculture. Manufactured short channel marketing without any is pursuing its specialty strategy in pipeline being dedicated to the and sold by Saipol, it is intended for intermediaries. This innovation responds global markets such as cosmetics, sustainable health management captive fleets, and in the first instance to the Group’s deliberate strategy to lubricants, coatings or foods. In 2018, of livestock units. In terms of biosecurity those operated by haulage contractors support the professional haulage sector this important actor in renewable (preventive hygiene) Avril now ranks first and local government bodies. and local government in their energy chemistry opened a new unit for the in Europe in the pig-poultry sector, and t can wholly and simply replace fossil transition by providing an immediate and production of isostearic acid and dimers its nutritional solutions to replace diesel, achieving equivalent performance pragmatic solution. It is also a lever to in Ertvelde (Belgium), specialties medications are attracting increasing without extra cost; its carbon balance create more value for French agriculture manufactured using a raw material from interest. AAS is reinforcing its efforts is more than 2.5-fold better, and it and industry. our sector: high-oleic sunflower oil. in all its priority growth areas and OUR STRATEGY 48 49 AVRIL — ANNUAL REPORT 2018
AVRIL VEGETAL
AVRIL AND COSTA D’ORO COMBINE FORCES THE AIM IS TO SHIFT FROM A VOLUME-BASED IN THE GLOBAL OLIVE STRATEGY TO A VALUE-BASED STRATEGY THAT WILL PROVIDE THE GROUP WITH OIL MARKET THE LEEWAY IT NEEDS TO GROW. The acquisition of Costa d’Oro, an Italian leader in branded olive oil, will enable Avril to accelerate its international growth by developing its positions in a market with considerable potential to create value. The aim of both partners is to drive the Costa d’Oro brand to become a global reference in high quality olive oil combining innovation, traceability and a natural origin in new geographical regions, notably China notably digestive health, prebiotics Upgrading the image of our brands and North America. In early 2019, the and probiotics with Nolivade, limiting Another part of the Group’s strategy is brand was launched in France with three ruminant waste and aquaculture, which to recreate value around B2C brands, iconic products, including a 100% Italian oil represents considerable potential for notably in the oils market. Avril is offering complete traceability to consumers, growth (see opposite). reviewing the marketing mix of its own accessible via a QR code. brands in line with its mission. New activities and markets Relaunched in 2018, Lesieur’s ISIO 4 oil for Avril Vegetal has reinforced its health benefits The development of specialties is not through an optimized formula and the prerogative of just one of Avril’s contains 95% French grain oil. In 2019, business lines. All parts of the Group are it will be the turn of the olive oil brand AVRIL SPECIALTIES now contributing to this trend. This is Puget to accentuate its membership indeed the area chosen by Saipol to of the Avril Group as being a competitive A-LIVE, A SOLUTION diversify and valorize it activities. Among advantage that is wholly in phase FOR AQUACULTURE many other projects, 2018 saw the birth with consumer demands, offering of Oleo100, the first 100% plant-based, a Puget oil of 100% French origin, Fish farming is the type of animal renewable and traceable fuel, alongside its variants in the production that has seen the greatest 100% made in France. Oleo100 can Mediterranean basin: 100% Moroccan growth worldwide (source: FAO). totally replace fossil diesel (see p. 47). and 100% Greek. For its condiments In a context of sustainable health Through the acquisition of Lecico, a and sauces, Lesieur is highly export- management, MiXscience is developing German company specialized in lecithins driven, based on the concept of French a range of preventive solutions for and phospholipids, the Group is pursuing gastronomy; the markets it is targeting aquaculture designed to prevent animal the growth of its activities in the sector as a priority are China (market testing deaths and reduce the use of antibiotics. and has become the leading actor in is ongoing in Shanghai), the Middle East Three years of research have been non-GM lecithin in the European market. and North America. necessary to develop the A-live innovation, Lecico has thus joined Expur, Kerfoot, The highlight of 2018 was acquisition which improves the intestinal balance of Lesieur, Novastell and Saipol within of the Italian brand Costa d’Oro; this has fish and shrimp, with both economic and Avril’s Oil & Ingredient Solutions, propelled Avril to third place globally societal impact. a platform specialized in refined and in the branded olive oil market and the specialty oils and ingredients, which already aim is to develop the olive oil category offers a vast portfolio of products to according to a sectoral structure, the industrial customers throughout the world. hallmark of Avril (see opposite). OUR STRATEGY 50 51 AVRIL — ANNUAL REPORT 2018
AREA 3
REDUCING EXPOSURE TO RISK
AVRIL HAS BEEN GROWING ENERGY COMMODITY AND AGRICULTURAL ACTIVITIES THAT ARE HIGHLY EXPOSED TO EXTERNAL RISKS.
For 35 years, Avril has been operating in Everything starts with safety agricultural and energy commodities 2018 will be remembered for the markets that are highly exposed to accident at the Saipol plant in Dieppe external risks: harvest yields and quality, which caused the death of two raw material prices, European employees of an Avril subcontractor. regulations on biofuels, health issues in This tragic event reminds us that safety French agriculture and livestock farming, is never a certainty, even though it has AVRIL GROUP etc. All these factors can have potentially been our number 1 priority since 2013. important impacts on the Group’ results. After years of progress during which A NEW SAFETY DYNAMIC – Avril has just lived through two years of the commitment to reducing the THE “WE CARE” PROGRAM crisis affecting its biodiesel activities. number of accidents by 20% a year One notable factor has been the unfair was achieved, the trend was reversed competition from Argentine soybean in 2018. In this context, the Group To give new impetus to continuously Furthermore, greater emphasis is now esters where a European response was initiated a new road map which focuses improving safety, Avril is setting up being placed on individual behaviors and only implemented in February 2019 with even more on individual behaviors a program developed jointly with personal commitment; priority is given the introduction of a quota system and (see opposite), supplemented by operational staff in its facilities. to prevention and exemplary behavior minimum price designed not to distort a program to reinforce prevention in An audit performed at six production by managers who will be trained to the market. Drawing on this experience, an industrial setting. sites resulted in a report of the current develop the approach. The aim is that the Group has now placed risk exposure In addition, numerous sites have situation and was able to define the each person should feel responsible at as a central theme of its 2023 strategic consolidated their skills and sustained principal opportunities for improvement. all times for his or her safety. Lesieur plan. This aims in particular to support an excellent level of prevention, such as The goals fixed for 2023 include Cristal (Avril’s subsidiary in Morocco) and secure commodities that are Saipol in Montoir-de-Bretagne, Matines halving the number of injuries in order was the pilot for the Group regarding essential markets for the sector, so that in Montdidier, Sanders in Saint- to work towards a zero accident rate. the design and organization of computer once again they will be profitable Thégonnec, Lesieur in Vitrolles, To address this challenge, existing tools dedicated to managing this safety and sustainable. la Compagnie des Saveurs in methods and tools will be enhanced. dynamic. OUR STRATEGY 52 53 AVRIL — ANNUAL REPORT 2018
AVRIL VEGETAL
NEW GENERATION BIOFUEL THE GROUP HAS NOW PLACED RISK EXPOSURE AS A CENTRAL THEME OF ITS Avril aims to make the environmental performance of biodiesel an area of excellence 2023 STRATEGIC PLAN. and a lever to create more value. The Group is already able to produce different biodiesels, scaled according to the reductions in greenhouse gas emissions they achieve. The markets targeted are Germany and Scandinavia as they are looking for biodiesel that will be able to obtain major reductions in greenhouse gas emissions, an ecological leap that can only be achieved based on farming practices and the types of crops grown. In this context, Saipol is preparing to launch an e-sourcing solution that will procure Noyers-sur-Cher, Oleon in Belgium, Expur Valorizing the commodities business value for the agricultural producers of oilseeds in Romania and Kerfoot in the UK, etc. The idea is to segment and valorize with high environmental performance. offers based on demands from customers Combining industrial and environmental and consumers. For example, Saipol’s performance strategy regarding biodiesel is to Initiated in 2013, the operational and monetize its environmental performance strategic excellence approach (EOS) (see opposite). In the oilseeds meals has already enabled the Group to save market, greater emphasis is being placed more than €100 million. To continue on the advantages of non-GM feeds for gaining in competitiveness, Avril is livestock and the supply of tailor-made modelling its methods and ensuring protein concentrates as a function of more rigorous monitoring of their demand. The online marketing platform AVRIL VEGETAL execution. Work on rationalizing the FeedMarket.fr can create direct links supply chain is ongoing, the aim being with customers that will enhance this ONLINE WITH valorization (see opposite). to improve sales planning and forecasts, FEEDMARKET.FR logistical costs and “just-in-time” customer service in all activities. Restoring value in the egg The leading marketplace for livestock At Saipol, trains and boats are replacing and table oils branches feeds, the FeedMarket.fr platform trucks for certain trips; Lesieur is Avril’s strategy in the egg market is to launched by Saipol in 2018 sells rapeseed preparing plans to rationalize its shift from a volume-based to a value- and sunflower oilseed meals online. warehouses in order to simplify based model. For the past two years, This enables breeders and feed and improve its deliveries, and Matines the entire branch has been reorganized manufacturers to directly contractualize is rationalizing its packaging centers to adapt to a markedly changing market their vegetable protein supplies five days and deliveries to major retailers. reflected by decelerating sales of out of seven. In 2018, FeedMarket.fr Reducing costs also requires standard eggs. The iconic Matines brand specialized its offer on non-GM and French improvements in energy performance, has now committed to supplying products, and in 2019, the teams are the challenge being to achieve more 100% alternative eggs by 2025; these will planning the development of mixes of with less. Six of Avril’s largest plants come from hens reared in barns, free vegetable protein and meal concentrates. are now equipped with biomass boilers range or under organic farming system. that supply 95% of their thermal energy In the table oils market, Lesieur’s ISIO 4 needs, and plans to modernize and Puget’s oils have been relaunched in the biomass heating plant the context of Avril’s vision of Cultivate are underway at Expur (Romania). Tomorrow, in order to earn more value. OUR STRATEGY 54 55 AVRIL — ANNUAL REPORT 2018
AREA 4
PU RSU I NG OUR TRANSFORMATION
PURSUING OUR TRANSFORMATION MEANS CONTINUING TO ADVANCE WITH RESPECT TO SUSTAINABLE DEVELOPMENT, A HIGHLY DIFFERENTIATING FEATURE OF THE GROUP.
In the early 2010s, Avril was still university that is continuing to increase AVRIL GROUP a grouping of SMEs. The profound its offer of qualifying management transformation initiated in 2012 training. Skills courses focused on the A NEW CAMPUS THAT has led to fundamental consolidation priorities of the Group’s transformation IS VERY AVRIL of the Group. The shared services center, are also being set up and helping to drive the Group intranet, integrated computer this culture shift: a three-year supply system and Avril Academy, etc., are all chain program, a module on cash culture, Opened officially in December 2018, The circular, light-filled space, whose concrete achievements that illustrate plans for training in innovation for R&D the Avril Campus marks a symbolic design was inspired by a clock, reflects how far we have come. As a major staff and a module designed to provide stage in the Group’s growth. the cycles that drive the activities element in this consolidation, the Avril support for managers when reorganizing It federates and assembles of the sector and recall the shape Campus was opened at the end of 2018. their entities within Avril Vegetal or Avril 450 employees who are now working of grains: the building has a diameter In Bruz (Ille-et-Vilaine) it now assembles Livestock Sectors, areas that are in a space imagined to foster new of 84 meters and three levels, with all animal sectors and services that were currently seeing profound change. collaborative and interactive methods. an indoor, covered and bioclimatic previously spread between different Another major change with respect As well as the Comex for Young People atrium in the center covering more sites in the Rennes area (see opposite). to talent management is that career and the managers concerned, more than 2,000m2. Resolutely focused interviews have become Career than 70 employees were involved in on sustainable development and with Our colleagues, actors Development Conversations, a special the steering committees that drove the HQE1 certification, the building’s roof is in this transformation moment that is separate from the annual project at each stage. The new campus home to a photovoltaic power plant that The creation of a common management performance interview and offers also has a company restaurant that meets all its needs and also generates culture is one of the objectives of the employees an opportunity to look to the offers fresh, local produce, and sports sufficient electricity to supply a further Avril Academy, the Group’s in-house future with their manager (see p. 69). facilities are available to staff. 60 households every year.
1. High Environmental Quality. OUR STRATEGY 56 57 AVRIL — ANNUAL REPORT 2018
AVRIL LIVESTOCK SECTORS
PRODUCE BETTER TO CONSUME BETTER In order to adapt to changes in the meat, milk and egg sectors in France, as well as to societal and environmental demands, IN THE EARLY 2010s, AVRIL WAS STILL the Animal Nutrition & Processing business A GROUPING OF SMES. THE PROFOUND line has been renamed Avril Livestock Sectors. This change is indicative of new TRANSFORMATION INITIATED IN 2012 HAS LED plans for the line to “produce better to TO FUNDAMENTAL CONSOLIDATION consume better”. Reorganized into sectors OF THE GROUP. with animal nutrition as the common bond, it aims to offer improved traceability of its products and to build sectors of excellence with the collaboration of its 26,000 partner livestock farmers throughout France.
AVRIL GROUP
Ongoing modernization of industrial A further step forwards in corporate A GROUP CULTURE assets social responsibility FOR ALL More than €180 million have been Pursuing this transformation also committed by the Group since 2015 to means continuing to advance Explaining the Group’s vision to give developing and modernizing its industrial with respect to sustainable a sense to everyday activities by facilities in order to adapt to changing development, a highly differentiating teams in the field is the mission of the markets. Lesieur, which has just opened a feature of the Group. new “WeeShare” program for Avril’s new mayonnaise factory in Algeria – where A new CSR framework supports the managers. Trained “Activators” from the brand is market leader – is planning a 2023 plan in the form of five pillars that Communications and HR will transmit three-year program of renovations to its reflect Avril’s mission. The Group is tools and methods to local managers French sites. The Abera pig slaughtering taking another step forwards by creating in order to help them communicate and butchery facility has reorganized its an indicator, “Spring”, which will measure with their teams and organize quarterly export packaging workshop to include new its progress through a score for each meetings for them that focus on the life automated technologies. Finally, the 4.0 CSR pillar and a global score (see p.39 and highlights of the Group, as well as industry model introduced in 2017 at the to 41). Actions by Avril subsidiaries its culture and values. pilot site in Le Mériot (Aube) is now being and Sofiprotéol are also aligned with deployed in other Saipol plants, and by this framework; for Sofiprotéol this Oleon and Sanders. The aim is to reduce will involve reinforcing its policies variability in process and product quality on appraisals of its stakeholdings while facilitating the work of operatives. in terms of CSR. 58 59 AVRIL — ANNUAL REPORT 2018
FINANCIAL €6,091 M €1,800 M HOW turnover equity WE SHARE VALUE €138 M €153.5 M investments EBITDA
DECIPHERING THE FINANCIAL AND EXTRA-FINANCIAL YEAR EXTRA-FINANCIAL 69% After two difficult years and a first Argentine soybean esters by fixing 27% quarter 2018 still affected by an a quota and minimum price. of the grain crushed by Saipol of laying hens of contracted adverse context, Avril’s situation is of French origin Sanders partners are reared recovered markedly in the second All Avril’s Business Lines achieved half of 2018. their financial goals, or more. under alternative systems The Group ended the year with an After a difficult year for Lesieur in EBITDA at €154 million (26% higher than France, 2019 is seeing benefits for its the goal) and achieved recovery, notably table oil activities from a repositioning in its core activity (oilseeds processing of its Puget and ISIO4 brands and the and biodiesel production). launch in French supermarkets of the Although some doubts persist, the Italian olive oil brand Costa d'Oro, regulatory landscape is becoming recently acquired by the Group. 78.4 clearer. Europe has confirmed a long- In terms of specialties, the downturn million people whose nutritional needs term future for the biofuel market in the performance of oleochemicals, for oil are covered by the Group until 2030, with an incorporation rate impacted at the end of the year by the stabilized at 7%. Some European European economic slowdown, was countries made up for their delays offset by the international dynamism in incorporating biodiesel as soon of animal specialties. Animal nutrition as the second half of 2018, causing and livestock products, now combined a marked rise in demand. Europe has within the Avril Livestock Sectors 94% 351 also declared its aim to place a ceiling Business Line, remained under pressure of renewable raw materials young people in internships or under on high-emitting biofuels and put an but ended 2018 in a positive position, end to unfair competition from driven by the performance of the used by Oleon alternating training in France HOW WE SHARE VALUE 60 61 AVRIL — ANNUAL REPORT 2018
THE GROUP ACHIEVED RECOVERY IN ITS CORE ACTIVITY, THAT OF BREAKDOWN OF FINANCIAL FLOWS OILSEEDS PROCESSING AND BIODIESEL PRODUCTION, WHICH IMPROVED ITS PERFORMANCE AND ONCE AGAIN GENERATED VALUE. GENERATED BY THE GROUP IN 2018
pork branch. Matines, currently in its CSR policies are progressing Consolidated turnover transition towards alternative eggs, and becoming more refined €6,091 M should see growth and profitability once The sustainable palm policy was updated again in 2020. On its side, Avril’s finance in 2018; the level of supply traceability and development company, Sofiprotéol, to the mills reached almost 100%, with almost doubled its commitments in 2018 a slight downturn compared to 2017 Purchase of raw Other materials and purchases and has confidence in a successful 2019 because a new subsidiary joined the goods through its excellent portfolio of Group. In 2019, Avril will be involved in €832 M investments. transformative field actions in Indonesia by €4,608 M supporting a program on the preservation Extra-financial performance gaining of natural habitats driven by the NGO Suppliers Suppliers in maturity and transparency Earthworm. Regarding the major issue The Group’s progress in terms of CSR of animal welfare, Avril is sustaining its has been shared between the different responsible change dynamic based on its Added value stakeholders – shareholders, customers partnership with the NGO CIWF which €651 M and NGOs – with which Avril is in regular provides support in its discussions and contact. Avril’s Communication on actions to target the Group’s partner Breakdown of added value Progress (COP) report, compiled in the livestock farmers. context of its membership of the Global In terms of energy performance, Avril Compact, was indeed qualified as progressed in 2018 with more sites “Advanced”, the highest level possible. obtaining ISO 50001 certification; this 66.8% 16.5% 1.4% 0.4% 3.0% In 2019, Avril will be publishing its first now brings the total to 34, or 40% of the statement on extra-financial Group’s industrial sites. Employees Public authorities Minority Fondation Banks performance in compliance Finally, the Avril Campus which opened (wages) (taxes, not incl. shareholders Avril (remuneration) with the new regulations. in Bruz in December 2018 is strongly deferred taxes) (dividends) Similarly, Oleon has launched a campaign symbolic of the attention paid by Avril to to evaluate its suppliers, in partnership its employees and its ambition to create Flows available after breakdown of added value with the EcoVadis rating agency. more synergies between its activities.
Investment capacity €78 M Capital Gains Net funding Grants injection on sales requirementt €6 M Sales & Acquisitions €21 M €101 M - €9 M In 2018, Avril announced its sale Avril also signed an alliance with the of Sopral, one of the companies Sabatini and Santirosi families who of the Avril Development Business Line. founded the Italian olive oil brand Flows available for investments in sectors To enable this expert in nutrition for Costa d'Oro; this has resulted in the dogs, cats and horses to accelerate birth of the third largest olive oil brand €198 M its penetration of international markets, in the world. To achieve this operation, Sopral was sold to Parquest Capital. Avril received support from the Castel However, Avril retains a minority holding Group, its historic partner in the in Sopral through Sofiprotéol, so that structuring of oilseed sectors in Africa. €31 M €115 M €52 M it can continue to provide support.
External Ongoing Sectoral growth investments investments HOW WE SHARE VALUE 62 63 AVRIL — ANNUAL REPORT 2018
SHARING VALUE WITH PARTNERS AN OLIVE OIL SECTOR IN THE MEDITERRANEAN IN OUR SECTORS BASIN THE UNDERTAKING: PARTICIPATE IN DEVELOPING AND In 2018, Avril acquired the premium STRENGTHENING SUSTAINABLE VALUE CHAINS Italian olive oil brand Costa d'Oro (see focus p.49), with the ambition of investing in upstream agriculture to structure the sector. The aim is to develop a sustainable sector that Avril’s DNA is to place its know- mirrors the model implemented by how at the service of structuring ESSENTIAL SUPPORT Lesieur Cristal for the past 10 years agricultural production according in Morocco. Avril operates 1,500 ha to a sectoral model by helping its TO ENABLE LONG- of its own olive groves in Morocco and partners to improve their response TERM INVESTMENT intends to acquire additional groves to demands from society. Having in other Mediterranean countries – contributed to relaunching non-GM “We produce heavy broilers Italy, Morocco and Tunisia – so that the soybean production in France, Avril is for McDonalds’s restaurants in entire value chain will be integrated to now involved in structuring the sector. France, the UK and Switzerland. the benefit of consumers, farmers The aim is to valorize the production In 2016, we carried out renovation and local actors. of 100% French soybean in local work so that we could respond sectors. In Maghreb countries, Avril to our customer’s specifications and Lesieur Cristal have successfully and improve the welfare of our contributed to the creation of rapeseed, chickens: we concreted the barns, sunflower and olive sectors in Morocco, inserted windows and equipped the and rapeseed in Tunisia, by involving buildings with perches. This year upstream agriculture and supporting we are planning to build two more local partners. Using the same model, technologically advanced barns and A SUSTAINABLE SECTOR the Group aims to structure an olive to employ more people. Sanders FOR FRENCH SOYBEAN oil sector in Italy and around the provided us with essential financial For several years now, Avril has been Mediterranean basin. and technical support. contributing via Sofiprotéol to a Its commercial backing allows us Through its commitment to valorizing program to revive the French soybean to be less worried about making the French Farm, Avril also plays sector which aims to increase the land long-term investments.” a structuring role in national area sown to soybean and introduce livestock sectors. Through Avril’s Youenn Le Fur, Princior table poultry a coherent industrial strategy. Livestock Sectors Business Line, and farmer, in Langoëlan (Morbihan) Sofiprotéol also became a stakeholder working in close collaboration with in crushing facilities: Extrusel in 2015 its 26,000 partner livestock farmers, in eastern France and then Sojalim Sanders has supported their personal in 2017, the latter feeding both projects regarding their installation conventional and organic livestock or conversion to other management sectors in south-western France. methods. Secondly, through its Along the same lines, Sofiprotéol is investment activities, Sofiprotéol supporting a new company called subscribed in 2018 to an increase in Selvah, which is based in Burgundy: capital of the LDC Group (brands such its future production unit for soybean as Loué, Le Gaulois, Maître Coq, etc.) protein-based food ingredients will use to a value of €30 million, its aim being traceable grain from the region. to become involved with a major French actor very close to Avril’s sectors. HOW WE SHARE VALUE 64 65 AVRIL — ANNUAL REPORT 2018
SHARING VALUE WITH CUSTOMERS SOFIPROTÉOL IS SUPPORTING ORGANIC AND CONSUMERS PRODUCTION THE UNDERTAKING: TO RESPOND TO DEMANDS FOR QUALITY There has been a marked increase in demand AND SUSTAINABILITY FROM CUSTOMERS AND CONSUMERS for organic products, and volumes are rising. But organic grain is often stored in smaller quantities than conventional grain, and requires appropriate equipment. Sofiprotéol has set up a specific system to provide financial support As a responsible actor in the agrifood at preferential rates to help grain elevators who industry, Avril guarantees the PULLETS IN A wish to convert their silos or build new facilities excellent health safety, traceability to store organic products in the future. and quality of its products. All its PERCHERY FOR FREE food processing units have obtained RANGE EGGS ISO 22000 certification. However, the Group goes even further and strives “I took over my father’s farm after DUCKS AND GEESE FROM to propose foods that will meet new I decided on a career change. We have demands from consumers for local, PÉRIGORD: A MODEL three buildings covering 5000 m2 red label or organic products, etc. OF EXCELLENCE where we rear pullets. We receive This trend requires the development chicks that had hatched the same In 2013, Sanders formed an alliance with of livestock sectors of excellence with morning and keep them for 17 to a local cooperative, La Périgourdine, to create partners both upstream and downstream 18 weeks. As a young farmer I wanted a short-channel PGI duck sector. Together, they so that they can offer meat of French to keep up with the times and adapt purchased a local abattoir and duck production origin that is free of antibiotics, organic to market demand. To prepare the company. Starting with 40,000 ducks, the or produced under short channel pullets to become free range laying sector now produces 650,000 a year, as well conditions, such as Canard du Périgord hens, they need to learn how to fly as 25,000 geese. Training in fattening methods (duck) or the Cochon des Halles brand so I transformed one of the buildings was initiated, followed in 2018 by courses in from PorcGros. On its side, Matines has into a perchery. This is an important biosecurity. All the buildings are lit naturally, with undertaken to offer 100% alternative long-term investment, and Sanders planted runs. In 2019, training in animal welfare eggs (from hens reared in barns, open offered support both commercially is being provided for all the farmers involved. range or under organic conditions) (with a 10-year contract) and between now and 2025. administratively (constitution of the And because the good health and files). If all goes well, I am planning a welfare of animals are prerequisites second perchery in a few years’ time.” ACTING FOR ANIMAL WELFARE for the quality of food products, Avril supports its partner livestock Antoine Le Digabel, pullet breeder Since it was formalized in 2017, Avril’s policy on farmers in the sustainable health in Plounévez-Quintin (Côtes-d'Armor) farm animal welfare has increased in transparency management of their farms. through detailed undertakings that have been The aim is to reduce the use of validated by groups of partner livestock farmers. antibiotics (measured using the Indic@vet Enriched and improved each year, in 2018 it focused monitoring tool) and improve practices on two priority actions: the implementation of good with respect to animal welfare. In its management guidelines for livestock units (that different plant sectors, Avril proposes have already been applied on more than 700 farms) a broad range of sustainable innovations, and a plan for the conversion of laying hen units to such as non-GM sunflower lecithin, alternative production methods. On this latter point, biobased additives for resins to be used Avril has introduced a process to support farmers in in wood-based panels, and organic, transforming their poultry units, the aim being that unfiltered or 100% Italian olive oil from half of them should be applying alternative methods Costa d'Oro. between now and 2022. A partnership has been signed with the NGO CIWF so that together we can explore new opportunities for improvement. HOW WE SHARE VALUE 66 67 AVRIL — ANNUAL REPORT 2018
SHARING VALUE TERRIAL BECOMES A LEADER IN ORGANIC TO BENEFIT THE PLANET FERTILIZERS IN FRANCE THE UNDERTAKING: TO PROTECT THE PLANET AND ITS RESOURCES In 2019, Suez became a stakeholder in Terrial, Avril’s subsidiary specialized in fertilization and the recycling of organic by-products, and contributed its compost Avril is a responsible industrial processes by-products and production activities. The new joint enterprise aims to actor committed to improving its rejects from the agrifood industry, offer a broader range of fertilizing products environmental performance transforming them into ingredients throughout France for farmers who are and creating new energies that for livestock feeds. The latter recycles seeking to reduce their use of chemical and can contribute to sustainable livestock waste and organic wastes artificial inputs; organic farmers of course, mobility in the future. generated by industrial activities but also market gardeners, wine growers To reduce its footprint, the Group into compost or methane to produce and arable farmers. has focused its efforts on developing fertilizers and renewable energy. biomass boilers. The boilers in six Avril is thus contributing to mitigating production facilities now prevent the climate change as an actor in energy emission of 130 kT of CO2 per year. In transition. This is possible through partnership with E.ON, Oleon invested innovations such as Oleo100, the first SOFIPROTÉOL SUPPORTS in a new combined heat and and power 100% plant-based fuel made using French BIOMETHANIZATION plant in Ertvelde (Belgium) which rapeseed, which can completely replace Alongside the farm cooperative Scara, produces all heat for its site in the form diesel (see p. 47). And also through its of high-pressure steam. By 2018, it had Sofiprotéol has become a stakeholder close local ties with upstream agriculture already generated a reduction in GHG in Biogaz d'Arcis, an innovative regional it is encouraging farming practices emissions equivalent to the energy used biomethanization project near Troyes that can markedly reduce GHG emissions, by more than 2,000 households in a year. (Aube). The biogas unit is scheduled to start such as no-till methods and the operation in mid-2019 and could cover the The Group is promoting a circular introduction of livestock and organic heating requirements of 12,000 homes, economy through its subsidiaries wastes, thus restoring to agriculture thus saving 12,000 tonnes CO2 per year and Adonial and Terrial. The former its role as a carbon sink. producing 33,000 tonnes of organic soil conditioner for local crops.
LESIEUR REUSES ITS FALLOW LAND IN FLOWER PACKAGING WITH TO CONTROL PESTS TERRACYCLE Avril is participating in an experiment Since May 2019, three of Lesieur’s products conducted in Burgundy by Terres Inovia have been present on the e-commerce platform on the control of rapeseed pest insects. Loop. Developed by TerraCycle, this enables The project, called R2D2, aims notably to consumers to order everyday products that promote the natural regulation of these pests are delivered to their homes in returnable by auxiliary insects through an increase in packaging. The packaging of Lesieur’s organic biodiversity that is achieved by the presence mayonnaise, Puget’s organic olive oil and organic of flowering plants on fallow land near ISIO4 oil is thus retrieved, washed and reused. cultivated plots. This will have three key This circular project aims to reduce the use of benefits: the restoration of profitability for single-use packaging and forms part of Lesieur’s farmers, biodiversity and the replacement of strategy with respect to responsible packaging insecticides. Lesieur is also making a financial management. contribution to this project. HOW WE SHARE VALUE 68 69 AVRIL — ANNUAL REPORT 2018
SHARING VALUE A CONVERSATION TO BUILD THE FUTURE TOGETHER WITH OUR EMPLOYEES A social innovation in 2018, the Career THE UNDERTAKING: TO CULTIVATE OUR VALUES Development Conversation offers a privileged TO WORK BETTER TOGETHER opportunity for employees to talk to their managers, unaffected by any performance evaluation. Driven by the employee who has In 2018, Avril implemented several thought about his or her strong points and career initiatives to enhance its collective INTRAPRENEURSHIP objectives, this conversation can help them to dynamic while enabling all employees consider their future within the organization. to develop their skills and look to AT THE SERVICE OF The manager is there to listen, assist and jointly the future. Building a Group where all TRANSFORMATION construct a practical career development plan. skills work in synergy requires The conversation also provides an opportunity a shared culture and common values. for the manager to place individual aspirations “The role of the Comex for Young The opening of the Avril Campus in in the context of the Group’s needs. People is to contribute to the Group’s Bruz near Rennes is thus a strong thinking and initiate new projects symbol, because on a single site it such as intrapreneurship. The aim has brought together several activities of the latter program, validated by that were previously dispersed (see the Comex, is to detect and support focus p. 55). Beyond this geographical DIGITAL CHAMPIONS BY AVRIL projects put forward by employees grouping, sharing was a key feature so that they can invent a business So that employees can share their pride in of the year. Avril initiated collaborative for the future that will create value. contributing to a valid project, Avril has set efforts around its vision of Cultivating By offering a favorable environment, up a transversal approach regarding digital the Future which is continuing in 2019: it aims to encourage people to take ambassadors. Chosen for their audience first through the Comex for Young initiatives and promote new ways on social networks and their commitment People and then with all colleagues. to innovate by rapidly testing these to the Group, and working on a voluntary basis, The objective is to enable the Group’s concepts with customers. The first 50 “Digital Champions” circulate news from their 7,490 employees to share its vision stage involves a call for candidates entity, the Group or the sector. The program while enriching their everyday for the first two projects in 2019.” is growing in 2019 with a dedicated online coach, experiences. events to recruit new ambassadors and a series Amandine Perez, Another way to federate teams is to of challenges to drive the community. In charge of the performance consolidate a common managerial of innovation processes, culture. This requires training Member of the Comex for Young People opportunities and these are growing from year to year; for example, 2018 saw a course on leadership for top ABERA INVOLVES ITS managers. At the level of individual EMPLOYEES IN IMPROVING development, a new interview should COMPANY PERFORMANCE help each employee to reflect on his or her future within the organization: The pig slaughter and butchery company the Career Development Conversation. has gambled successfully on the collective For the fourth consecutive year, intelligence of its 350 employees in order to Avril is deploying an employee share improve its overall performance. This has been ownership plan; in 2018 participation achieved by encouraging them to report problems reached 40%¹, a sign of trust in the and then find a solution to them. For the past future. And finally, in 2019, the Group three years, all employees have had a financial will be carrying out its third in-house interest in attaining goals with respect to safety, opinion survey entitled “And how is it quality, hygiene and productivity. This is boosted for you?” by a further criterion; the number of suggestions
1. 1,831 employees among those eligible. they make for improvements. In 2018, the achievement rate for these goals reached 87.5%. HOW WE SHARE VALUE 70 71 AVRIL — ANNUAL REPORT 2018
SHARING VALUE LESIEUR PARTICIPATES IN THE MALIN PROGRAM WITH OUR STAKEHOLDERS In the framework of the national AND SOCIETY strategy to prevent and fight against poverty, the MALIN Program acts, THE UNDERTAKING: TO ENGAGE WITH OUR STAKEHOLDERS thanks notably to the French Family Allowances Fund, to improve the nutrition of young children in tight- income families. Its aim is to improve Avril’s regional roots are a specific nutritional practices and enable access to good quality products. feature of its DNA. They are inherent ENCOURAGING to the close relations that bind the Thanks to Lesieur’s support, and Group with its partners in upstream SUSTAINABLE in close cooperation with pediatric agriculture – 110,000 farmers and 26,000 LIVESTOCK associations, MALIN strengthens its livestock breeders – and its 84 locally- communication on the benefits of using based production sites. Avril’s different PRODUCTION vegetable oils and offers money-off entities develop initiatives that make coupons for the ISIO4 range. them partners in local life. To celebrate “CIWF1 is an international NGO its 90th birthday, Abera organized a series whose mission is to encourage of events that ranged from a drawing sustainable livestock practices that competition to a football tournament respect animal welfare. CIWF works for children in Coglais (Ille-et-Vilaine). notably with actors in the agrifood Oleon organized numerous projects sector, using its technical expertise in favor of local communities, such as and helping them to valorize their the initiative shared with its customer, commitments through its Good Farm FONDATION AVRIL: Christeyns, to offer care products to Animal Welfare Awards. Our role is SUPPORTING THE underprivileged people. Avril also seeks to encourage companies, such as to increase local awareness of its model; the Avril Group, to make a concrete TRANSITION OF FARMING for example by organizing visits to its commitment to improving animal MODELS industrial sites. welfare in their supply chains, and The Fondation Avril is refocusing its to help them develop and apply their The Group also draws on the expertise actions in France to support farmers to own animal welfare policies.” of NGOs to progress its sustainable create sustainable value in the regions and development policies. Supported since Amélie Legrand, Senior Food Business reinforce their links with consumers. 2016 by the Earthworm Foundation, Manager at CIWF Several initiatives reflect these new in 2018 Avril achieved almost 100% ambitions: the creation of a fund to aid traceability for its palm oil purchasing farmers with the diversification of their and in 2019 is supporting a local initiative activities and changes to their practices in Indonesia designed to put an end to (short channels, renewable energies, etc.) deforestation while at the same time or the adaptation of tools to agriculture that enabling viable agricultural production. have been developed in the classic context Avril also signed a partnership with CIWF of entrepreneurship (such as microloans). which is supporting the Group in its The Fondation also participated in launching progress initiative on animal welfare a competition with AgroParisTech to (see opposite). More generally, encourage engineering schools to focus the Group wishes to involve increasing on the themes of agriculture and digital numbers of its stakeholders in its thinking sciences in terms of the fight against climate and actions. A committee will be created change. In 2018, 22 projects were funded in for this purpose in 2019. France and Africa.
1. Compassion in World Farming. 72 73 AVRIL — ANNUAL REPORT 2018 KEY CSR INDICATORS 2018
Indicator Value 2018 Target 2023 Indicator Value 2018 Target 2023
PILLAR 1 - OUR VALUE CHAINS PILLAR 2 - OUR PRODUCTS & SERVICES Participate in developing and strengthening sustainable value chains Respond to demands for quality and sustainability from customers and consumers
PROCESS LOCAL RAW MATERIALS OFFER SAFE AND HIGH-QUALITY PRODUCTS
Percentage of French oilseed production (rapeseed/ Percentage of new products developed by Oleon without 47.6% - 95% - sunflower) processed by Saipol’s industrial facilities a risk classification
Percentage of grain grown in France crushed by Saipol’s RESPOND TO NEW DEMANDS FOR LOCAL OR ORGANIC PRODUCTS, ETC. 69.2% To be defined in 2019 industrial facilities S Percentages of French products among those sold by the 100% and 99 % - Percentage of Romanian oilseed production (rapeseed/ Pork and Egg Branches, respectively S 10.1% - S USTAINABILITY sunflower) processed by Expur’s industrial facilities P OGRESSIDEX Percentages of organic products made by animal nutrition 1.5% and 7.5% To be defined in 2019 and by the Egg Branch, respectively Percentage of grain grown in Romania crushed by Expur’s S 88.6% To be defined in 2019 S industrial facilities Percentage of renewable raw materials of animal or plant S 94% - S USTAINABILITY Percentage of French raw materials processed by industrial P OGRESSIDEX origin used in Oleon industrial facilities S 2 81.3% Maintain a level >80% each year S USTAINABILITY facilities operated by ALS animal nutrition S P OGRESSIDEX Level of GHG3 reduction achieved by biodiesel sold by INVEST SUSTAINABLY IN OUR SECTORS 59.8% Target of 65% Saipol versus reference fossil diesel S S S USTAINABILITY P OGRESSIDEX €370 M over the period Amount invested (disbursed during the year) by Sofiprotéol €48.5 M FEED HUMAN POPULATIONS S 2019-2023 S S USTAINABILITY P OGRESSIDEX Edible oils - Equivalent number of individuals whose 78.4 M - Number of people employed by companies in which nutritional needs in oil are covered by the Group S 2,183 - S USTAINABILITY Sofiprotéol invested during the year (France) P OGRESSIDEX Meat/Egg proteins - Equivalent number of individuals whose CONTRIBUTE TO AGRICULTURAL TRANSITION 27.2 M - nutritional needs in Meat and Eggs are covered by the Group Update: in 2018, and in collaboration with Terres Inovia and Terres Univia, Avril initiated discussions on structuring a common approach to more sustainable farming practices that draw strength from upstream/downstream synergies within the sector. Dairy proteins - Equivalent number of individuals whose intakes of dairy proteins are covered indirectly through animal 5.8 M - Investments (commitments by Sofiprotéol) in seed feeds and oilseed meals produced by the Group €15 M - companies working on varieties adapted to climate change Investments (commitments by Sofiprotéol) in companies IMPLEMENT SUSTAINABLE SOURCING whose activities are linked to the development of vegetable €115.7 M - proteins Percentage of palm oil from certified sectors (ISCC-EU, 94.7% Maintain a level >90% each year ACT FOR ANIMAL WELFARE S RSPO) or covered by RSPO credits Percentage of compliance of laying hen units audited1 Target 100%, with cases of Percentage of non-GM soy or or soy covered by RTRS according to internal livestock management guidelines 96.8% non-compliance corrected 1 24.0% - S credits used for animal feed S S USTAINABILITY (compliance as from the first audit) P OGRESSIDEX within the periods stipulated
S Percentage of laying hens reared under alternative systems 1. Soybean of French origin, non-GM soybean imported and traced “outside the Amazon Biome”, RTRS credits. S USTAINABILITY 27.2% Target more than 50% OGRESS DEX 2 P I in units operated by contracted Sanders partners 2. Avril Livestock Sectors. S
S S USTAINABILITY 1. Laying hen units operated by contracted Sanders partners. P OGRESSIDEX 2. Hens reared in barns (code 2), free range (code 1) or under organic conditions (code 0). 3. Greenhouse gases. 74 75 AVRIL — ANNUAL REPORT 2018
Indicator Value 2018 Target 2023 Indicator Value 2018 Target 2023
PILLAR 3 - Our Planet PILLAR 4 - Our people Protect the planet and its resources Cultivate our values to work better together
REDUCE THE ENVIRONMENTAL FOOTPRINT OF OUR INDUSTRIAL ACTIVITIES KEY HR FIGURES
Target per tonne of products All Group staff ¹ 7,490 - Energy consumption of the Group1 3,390 GWh S to be defined in 2019 Breakdown of employees by type of contract: permanent (CDI) 94.1% of CDI 2 - 2 or fixed-term (CDD) 5.9 % of CDD S Annual change in energy intensity of key industrial facilities - 0.6% - S USTAINABILITY P OGRESSIDEX Percentage of women among all Group staff 3 29.1% Target of 33% Ratio between the consumption of energy from renewable S 3 29% To be defined in 2019 S sources and total energy consumption Number of accidents with and without absence from work per 10.9 Reduce to 5.4 S 1 million hours worked during 2018 (TF2 ratio) S USTAINABILITY 3 P OGRESSIDEX Scope 1 and 2 GHG emissions 538 kt CO2 eq. - S S USTAINABILITY DEVELOP ALL TALENTS P OGRESSIDEX Target per tonne of products S 4 3 S USTAINABILITY Total water consumption by the Group 7.9 M m P OGRESSIDEX Number of hours of training, per FTE, during 2018 S to be defined in 2019 16 hours - (in France)4 DEVELOP THE CIRCULAR ECONOMY S S USTAINABILITY Internal mobility rate (between and within Group companies, P OGRESSIDEX 6.8% - Recycling rate of industrial waste (in France) 96.2% >95% at Group level in France)5 S
Quantity of agrifood by-products, production rejects and Percentage of attachments and those in alternating training 26.6 kt - 6 7.5% Target of 8% S surpluses recycled by Adonial S among the mean total of staff registered in 2018 (in France) S USTAINABILITY P OGRESSIDEX
Quantity of industrial waste of organic origin recycled by Percentage of women among top managers in the Group 25% Target of 30% 52.4 kt - S S USTAINABILITY Terrial OGRESS DEX P I Percentage of Group companies employing at least 6% 7 38% To be defined in 2019 Quantity of organic fertilizer produced by Terrial 283.8 kt - S of disabled individuals (in France) S USTAINABILITY P OGRESSIDEX Investments (commitments by Sofiprotéol) in the CDI (permanent contract) resignation rate (in France)8 4.47 % - S funding of companies in the circular economy (renewable €2.6 M - S USTAINABILITY P OGRESSIDEX chemistry, biogas, etc.) CARE FOR OUR EMPLOYEES
Target more than 50% Percentage of temporary agency workers in 2018 (France)9 9.8% - Use rate of recycled PET plastic by Lesieur 5 22.4% S for Lesieur Number of meetings of the Group Committee and European 3 - Works Council in 2018 S USTAINABILITY 1. Final energy consumption (electricity, gas, fuel oil, biomass). Scope: 58% of the Group’s industrial sites. S P OGRESSIDEX 2. Principal facilities covered: Crushing, Neutralization, Refining, Esterification, Oil bottling, Pig slaughtering, Manufacture of livestock feeds, etc. Strike rate (in France) <1% - Scope: 50% of the Group’s industrial sites. 3. Scope: 58% of the Group’s industrial sites. 10 4. Consumption of mains, well and surface water. Scope: 58% of the Group’s industrial sites. Absenteeism rate (in France) 3.97 % - 5. Weighted mean (in mass) of the content of PET for Lesieur and Puget household packaging (bottles and dispensers). PILLAR 5 - Our stakeholders Engage with our stakeholders
Update: an approach regarding openness to local stakeholders in different regions has been implemented: since 2018, meetings with elected representatives and farmers in regions where the Group operates have been organized. In addition, the constitution of a Stakeholders Committee is ongoing (launch planned at the end of 2019).
1. Staff registered on 31/12/2018 (number of employment contracts), not including company representatives, temporary staff and those on attachment. 2. Percentage calculated from staff registered (number of employment contracts) on 31/12/2018, not including company representatives, temporary Details on reporting staff, those on attachment and those in alternating training (vocational training or apprenticeships). The indicators are consolidated at Group level (unless otherwise specified) and cover the 2018 calendar year. Data from companies in which 3. Percentage calculated from staff registered (number of employment contracts) on 31/12/2018, not including company representatives, temporary Avril has a majority stake are consolidated globally and not in proportion to their integration in the Group. staff and those on attachment. 4. Hours of training delivered in the context of a training agreement with an approved organization/average FTE staff in 2018. 5. Number of people moving within the Group in 2018/mean staff registered in 2018. Moves within companies correspond to a change to CSR indicators with a 2023 target. 2018 was a year of transition for the Group’s CSR approach, and some Spring CSR targets will be a collectively agreed employment contract without changing company. Moves between companies correspond to a change of company. S defined during 2019. The Spring index value will therefore be communicated in the Annual Report for 2019. 6. Percentage calculated from mean staff registered in 2018, taking account of those on a paid attachment, those in alternating training, under an apprenticeship and in vocational training. 7. The basis of calculation corresponds to companies with an obligation to employ handicapped individuals in 2018. S 8. Number of CDI staff resigning during the year/mean staff registered in 2018. S USTAINABILITY P OGRESSIDEX 9. Percentage based on mean FTE staff numbers in 2018. 10. Number of hours of absence (for illness only (not including maternity-paternity leave), occupational and travel accidents, occupational illness, long-term illness and other)/Theoretical number of working hours. 76 77 AVRIL — ANNUAL REPORT 2018
FINANCIAL INFORMATIONS
Selected financial data Industrial production (DATA IN € MILLIONS) (DATA IN THOUSANDS OF TONNES)
Turnover EBITDA 2017 2018 Sofiprotéol and its subsidiaries 29.0 12.8 OILSEEDS SECTORS Avril Vegetal 3,998.5 43.9 Crushed grain (not incl. specialized crushing) 3,825 3,600 of which Oilseeds Processing 2,896.9 0.8 Edible oils (packaged + bulk) 1,226 1,163 of which Oils & Condiments 1,101.6 43.1 Sauces 36 29 Avril Specialties 867.5 66.3 Oilseed meals (not incl. specialized crushing) 2,143 1,868 of which Oleon 687.9 56.1 Biodiesel 1,823 1,552 of which Avril Animal Specialties 179.7 10.2 of which production in France 1,399 1,347 1 Avril Livestock Sectors 1,669.2 23.2 of which international production 424 204 of which Animal Nutrition 1,202.8 20.7 Oleochemical products 685 629 of which Egg and Pork Branches 466.4 2.5 Soap 142 57 Avril Development 77.4 8.4 ANIMAL SECTORS Other 93.2 (1.0) Feeds produced (not incl. premixes) 2,885 2,761 Eliminations (644.0) - Tonnage of pigs slaughtered 127 122 Total Group 6,090.8 153.5 Number of eggs (upstream eggs, shell eggs and egg products) (in millions) 3,031 2,972 Product premixes and basemixes2 55.5 56.5
1. Change in 2018: not including biodiesel production by NEW (192 kt). Group 2017 Group 2018 2. MiXscience, BNA Polska, Salus. Group net consolidated pro forma income (56) 16 Equity 1,749 1,800 Commitments of the finance Investments 136 138 and development company of which industrial investments in animal sectors 36 36 (DATA IN € MILLIONS)
of which industrial investments in oilseeds sectors 64 51 2017 2018 of which finance and development company (1) 15 Upstream oilseeds production 34.9 26.5 of which Group information systems 36 15 Upstream livestock production 50.2 50.3 of which other (CAPEX Group holding, new Campus, etc.) - 21 Agricultural and agri-food processing and by-products 89.2 68.2
Consumer food products 23 58.6 Sustainable innovations, investment funds, other 23.8 27.8 Debt fund 13 13 Total commitments 234.1 244.4 78 79 AVRIL — ANNUAL REPORT 2018
AVRIL GROUP: TWO COMPLEMENTARY ACTIVITIES
Avril Specialties
Avril Vegetal
Avril Development
Avril Livestock Sectors
Finance and development company ANNUAL REPORT Activity and Sustainable development
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groupeavril We would like to thank all Avril’s employees and partners – agricultural producers, livestock farmers, research scientists, fund-providers – who supported the Group and its achievements in 2018.
Published by the Avril Group Communication and Sustainable Development Departments - Publication Directors Tom Doron, Clément Tostivint - Design and production - Photo credits groupeavril Avril Filières d’Élevages, Hadrien Brunner, Coopérative Scara, Cédric Helsly, Loop, Macroworld, Aurélien Mahot, Michaël Meniane, Philippe Montigny, Gwenaël Saliou, Yannick Thoraval, Thibaut Voisin. iStock/Jevtic, Dave Alan, Pexels/Pixabay. Unsplash/John Cameron, Chuttersnap, Gabriel Jimenez, Kobu agency, Sandro Mattei, Adam Morse, Sharon Pittaway, Gustavo Quepon, Markus Spiske. ©Groupe Avril - All rights reserved (June 2019).
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