GLANBIAyour Delivering for you Glanbia Co-operative Society Annual Review 2017 GLANBIA CO-OPERATIVE SOCIETY COUNCIL2017 HIGHLIGHTS MEMBERS Contents €14 2017 Highlights 3 Chairman’s Statement 4 pergrain price tonne support How Glanbia delivers for you 8 at harvest 2017 Group Managing Director’s Statement 10 Ballyragget Celebrates 100 Years 12 31.5% 60% Glanbia Ireland 2017 Highlights 14 shareholding Glanbia plc 2017 Highlights 18 shareholding in Glanbia Ireland in Glanbia plc Castlelyons Celebrates 100 Years 20 €5.7 Board Members 22 Retired Glanbia Council Members in 2017 24 million Council Members 25 of Member Support Regional Committee Members 28 paid in 2017 Member Engagement 30 National Ploughing Championships 2017 32 Summary Profit and Loss Account 34 Summary Cashflow 35 Consolidated Group Income Statement 36 Consolidated Group Balance Sheet 37 your Notes 38 GLANBIA Delivering for you in 20|7 13 cent per share 26 Spin-out of Share Interest (Ordinary Dividend) for approval cent per share at 2018 AGM Share Interest (Special Dividend) 5.9 to be paid in 2018 million Glanbia plc shares to Co-op Members in 2017 2 Glanbia Co-operative Society Limited – Annual Review 2017 Glanbia Co-operative Society Limited – Annual Review 2017 3 COUNCILGLANBIA MEMBERSCO-OPERATIVE SOCIETY 2,400 GLANBIA CO-OPERATIVE SOCIETY attendedMembers and voted Chairman’s Statement at the SGM “ Glanbia Co-op is Dear Member, From a Glanbia Co-op Member This level of profitability is required to 2018 €20 million Patronage 2018 Trading Bonus Scheme perspective, the new model created in ensure that the business can finance 2017 was a major year in your Co-op’s Support Fund On 15 January 2018, we announced now in a very strong 2017 has a number of clear advantages: ambitious investment plans. development, the highlight undoubtedly The Board of Glanbia Co-op will also our new Glanbia Co-op 2018 position, with major being the formation of Glanbia Ireland • The Co-op is capitalising on key Shareholders have agreed that 50% of seek Members’ approval at the upcoming Trading Bonus Scheme. This Scheme shareholdings in two after the Co-op acquired a 60% global nutrition trends through a annual Glanbia Ireland profit is retained SGM for the creation of a new Patronage will reward Members for their trade shareholding in the Dairy Ireland diversified portfolio of assets in a within the business in order to drive Support Fund through the allocation of with the business that we majority superb companies. division of Glanbia plc. range of markets; growth. The remaining 50% will be €20 million from existing Co-op cash own, Glanbia Ireland. distributed to shareholders. Our Co- It is well placed to The formation of Glanbia Ireland was • Led by two excellent management resources to the Fund. The Patronage For milk supplier Members of op, as the 60% shareholder, is already one of a series of proposals made by teams, Glanbia plc and Glanbia Support Fund will be for the benefit of Glanbia Co-op, the 2018 Trading continue to be strong, benefiting from this substantial and the Board which were approved by Ireland are focused on their own active Members who supply to, purchase Bonus is potentially worth up to sustainable new annual income stream. progressive and in excess of 93% of the almost 2,400 ambitious growth agendas, based on from or trade with the Glanbia Group. If 0.75 cent per litre (cpl) on all milk supportive for all Co-op Members who voted at a Special their unique capabilities, talented In January 2018, the Co-op received a approved, the nature and timing of any delivered in 2018, depending on payments from this Fund will be at the of our Members.” General Meeting (SGM) of the Co-op employees, innovation pipelines payment of €12m – its first dividend the level of purchases from Glanbia held in the Punchestown Event Centre and strong market positions; from Glanbia Ireland. Following the discretion of the Glanbia Co-op Board. Ireland relative to milk supplied. on 18 May 2017. approvals obtained at Punchestown • The Co-op now has two strong For grain growers, a Trading Bonus Henry Corbally on 18 May 2017, all dividends paid Member Supports This huge endorsement facilitated the and sustainable dividend income of up to €10 per tonne of grain Group Chairman by Glanbia Ireland to the Co-op are set Dairy markets staged a welcome creation of Glanbia Ireland in July, streams – from Glanbia plc and supplied is available for 2018, again Glanbia Co-operative Society Limited aside for distribution to active Members. recovery during 2017 from the combining Glanbia Ingredients Ireland, Glanbia Ireland; dependent on the level of purchases unsustainably low levels of 2016. As Glanbia Consumer Products and For 2018, the primary mechanism for from Glanbia Ireland relative to • There is unrivalled transparency a result, your Co-op did not make any Glanbia Agribusiness in a joint venture the distribution of this dividend is the grain supplied. – shareholders can clearly see milk support payments during the year. 60% owned by the Co-op and 40% Glanbia Co-op 2018 Trading Bonus the market value of their output, Unfortunately, grain markets remained Beef, sheep and pig farmer owned by Glanbia plc. Scheme, which we were pleased to the financial performance of the customers of Glanbia Ireland that announce on 15 January 2018. weak in 2017. In light of the very Your Co-op also remains the largest business, the level of any support challenging year for our growers, on 12 are Co-op Members will also qualify individual shareholder in Glanbia plc, payments and the annual value Punchestown SGM October 2017 the Board announced Co- for a €5 to €10 per tonne Feed with a valuable 31.5% shareholding. distribution from their Co-op. op support of €14 per tonne to Members Bonus as part of the Scheme. The following Board proposals were • Since the creation of Glanbia Ireland for green and dried grain from harvest Your Co-op’s investments in two also overwhelmingly approved by we have introduced a number of 2017. When grain supports are combined commercially driven, ambitious Members at the Punchestown SGM: organisations – Glanbia plc and commercial initiatives to bring our with bonus payments on feed and Glanbia Ireland – generate the value Members closer to the business • Distribution by way of “Spin-out” fertiliser, the Co-op paid total supports for subsequent distribution to as both customers and suppliers of 5.9 million shares in Glanbia to Members of €5.7 million. Members as summarised on while also very directly supporting plc, valued over €92 million to all Payments were made from the pages 8-9 of this report. Members through what has been a Members of the Co-op. The “Spin- Member Support Fund that was Most importantly, this very difficult Spring for Irish farming; out” was completed on 1 September established in 2015 at our SGM in 2017 and was worth approximately Gowran Racecourse. structure ensures that • In the first quarter of 2019, farmers €6,300 for a Member with the your Co-op has the that trade with Glanbia Ireland will be financial capability to average shareholding; Ordinary Share Interest paid their 2018 Co-op Trading Bonus, (Dividends) support the farming a clear and tangible benefit of the • The creation of a €40 million Member enterprises of our new Glanbia structure where a share Support Fund. Payments from the Total ordinary share interest (dividend) active Members of the profit made by Glanbia Ireland Fund will be in the proportion of payments authorised during 2017 in challenging will flow back to Members producing 75% patronage to active Members amounted to €3.9 million (10 cent per times, as well the raw materials for the business. and 25% Special Dividend (share share). The Board of Glanbia Co-op will as consistently interest) to all Members. The nature be recommending to the Co-op’s AGM a paying a Glanbia Ireland and timing of any payments will be significant increase in the ordinary share strong ordinary at the discretion of the Glanbia Co-op interest paid to all Members. If approved The Glanbia Ireland business is run share interest Board, subject to the Special Dividend by Members, the Ordinary Dividend will on a commercial basis, with a clear (dividend) to all element of 26 cent per Co-op share increase by 30% to 13 cent per Co-op mandate to pay a competitive price Members. being paid by 31 December 2018. share (ordinary dividend in 2017 was 10 for milk and grain. It is investing to cent per share). The Co-op is committed increase capacity in line with our The Co-op funded the acquisition of to paying a Special Dividend to Members Members’ growth ambitions and to add 60% of Dairy Ireland and created the of €10 million by 31 December 2018, value to that produce for the benefit of €40 million Member Support Fund 2017 based on the approvals obtained at all shareholders. through the sale of 8.7 million Glanbia the SGM held on 18 May 2017. Total plc shares at €17.80 per share on 22 The shareholders in Glanbia Ireland Co-op dividend payments during 2018 May 2017. €40m – Glanbia Co-op and Glanbia plc – will amount to circa 39 cent per share, have agreed that the business will assuming the relevant approvals are have a minimum Profit-After-Tax of forthcoming on 30 May 2018. Member Support 3.2% of annual net revenue. Fund created 4 Glanbia Co-operative Society Limited – Annual Review 2017 Glanbia Co-operative Society Limited – Annual Review 2017 5 GLANBIA CO-OPERATIVE SOCIETY GLANBIA CO-OPERATIVECOUNCIL MEMBERS SOCIETY Chairman’s Statement Revolving Share Plan In addition, the Society facilitates an on- Members at the SGM.
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