Other information

2.5.1 Result appropriation scheme under the articles of association

2.5.1.1

Articles 36, 37 and 38 of the articles of association of the Company read as follows:

Payments - General

Article 36

36.1 Payments may be made only to the extent that the Company's equity capital exceeds the amount of the paid up and called up part of its capital, plus the reserves that have to be maintained by virtue of the law.

36.2 The Executive Board may decide to make an interim payment, if the requirement of Article 36.1 has been satisfied, as evidenced by an interim statement of assets and liabilities, drawn up in accordance with article 105 (4) of Book 2 DCC, and if the payment in question concerns an interim payment of profits, with due observance of the sequence set out in Article 38.1.

36.3 There is no entitlement to payments in relation to preference shares or the priority share, other than as set out in the Articles 12.2, 38.1 and 39.3.

36.4 Payments are made in proportion to the aggregate nominal amount of the shares of the class in question. Notwithstanding the previous full sentence, payments on preference shares (or payments to the former holders of preference shares) are made in proportion to the amounts paid up, or paid up earlier, on those preference shares.

36.5 Those entitled to payments are the relevant shareholders, holders of a right of usufruct and holders of a right of pledge, depending on the circumstances of the case, on a date determined for that purpose by the Executive Board. This date shall not precede the date on which the payment is announced.

36.6 The General Meeting may resolve, with due observance of Article 32, that a payment will fully or partly be made in the form of shares in the Company's capital or in kind, instead of in cash.

36.7 Payments will be made available on a date to be determined by the Executive Board and, if a payment in cash is concerned, in a currency to be determined by the Executive Board.

36.8 A claim for payment shall lapse upon expiry of a period of five years after the payment became available.

36.9 When calculating the amount or the distribution of a payment, the shares held by the Company in its own capital are not considered. No payment is made to the Company on shares held by it in its own capital.

Payments - Reserves

Article 37

37.1 All reserves maintained by the Company are attached to the ordinary shares only, unless expressly provided otherwise in this Article 37.

37.2 The General Meeting is authorized to resolve to make a payment at the expense of the Company's reserves, with due observance of Article 32.

37.3 Without prejudice to the provisions of Articles 37.4 and 38.2, payments at the expense of a reserve shall be made on those shares only to which such reserve is attached.

37.4 The Executive Board may resolve to charge amounts to be paid up on shares to the Company's reserves, regardless as to whether those shares are issued to existing shareholders.

Payments - Profit

Article 38

38.1 With due observance of Article 36.1, any profits appearing from the Company's annual accounts regarding a specific financial year shall be distributed in the sequence set forth below:

  1. to the extent that preference shares were withdrawn without the payment specified in Article 12.2 (b) having been made in full and without such a deficit subsequently having been paid in full as set forth in this Article 38.1 or Article 38.2, an amount equal to such a deficit, or remaining deficit, will be paid out to the one or the ones who was or were holding preference shares the moment the withdrawal took effect;
  2. to the extent that any Preference Payment (or any part thereof) on previous financial years has not yet been effected in full as set forth in this Article 38.1 or Article 38.2, an amount equal to such a deficit, or remaining deficit, will be paid out on the preference shares;
  3. the Preference Payment on the financial year to which the annual accounts relate will be paid out on the preference shares;
  4. the Executive Board determines which part of the remaining profits will be added to the Company's reserves;
  5. from what is left of the profits remaining thereafter an amount equal to the nominal amount of the priority share will be paid out on the priority share; and
  6. with due observance of Article 32, the profits remaining thereafter shall be at the disposal of the General Meeting in order to be paid out on the ordinary shares.

 

 

38.2 To the extent that the payments set forth in Article 38.1 (a) up to and including (c) (or any part of these) cannot be made from the profits appearing from the annual accounts, a deficit of that kind will be paid out at the expense of the Company's reserves, with due observance of the Articles 36.1 and 36.2.

38.3 Payments of profits are made, with due observance of Article 36.1, after the adoption of the annual accounts showing that such is permitted.

2.5.2 Special provision in the articles of association regarding governance

2.5.2.1

Trust Office Foundation

The management of the ForFarmers Trust Office Foundation operates independently of the Company. The ForFarmers Trust Office Foundation holds ordinary capital shares in the Company and is intended, inter alia, for (i) the acquisition of ordinary shares for management purposes (ii) the issue of depositary receipts, (iii) where applicable, the acquisition, disposal and encumbrance of shares for its own account, (iv) the exercise of rights associated with the ordinary shares it holds and (v) the granting of proxies for the exercise of voting rights as well as the acceptance of voting instructions as regards the exercise of the voting right, all in accordance with the Trust terms & conditions. The Articles of Association, Trust terms & conditions and the Report of the ForFarmers Trust Office Foundation (in Dutch: “Stichting Beheer- en Administratiekantoor ForFarmers”) are on the Company’s website. As aforementioned, only Coöperatie FromFarmers U.A. may issue binding voting instructions for the shares held by the aforementioned foundation (and for which voting rights have not been requested).

The Trust Office Foundation shall only accept ordinary shares for management purposes against issue of depositary receipts to (i) a holder of depositary receipts within the context of exercising a share claim, (ii) someone entitled to the balance of a participation account held with Coöperatie FromFarmers U.A. within the context of a conversion, (iii) an employee as part of an participation plan, (iv) Coöperatie FromFarmers U.A. or (v) a party designated by the aforementioned Cooperative.

Priority shareholder

The priority share is held by Coöperatie FromFarmers U.A. As a result of the treasury shares held by the Group Coöperatie FromFarmers U.A., on the latest reference date of 1 January 2019, could exercise the voting right for 48.5% of votes to be cast on the total of ordinary shares. Furthermore, the Coöperatie FromFarmers U.A. could give voting instructions with regard to the shares held by the Trust Office Foundation, giving it a total voting right of 55.9%. As priority share holder Coöperatie FromFarmers U.A.:

(i) has a recommendation right for four of the six members of the Supervisory Board;
(ii) may appoint a member of the Supervisory Board as Chairman after consultation with the Supervisory Board;
(iii) has an approval right as regards the decisions of the Executive Board regarding:
  1. moving the Company’s head office outside the east of the Netherlands (Gelderland and Overijssel);
  2. an important change in the identity of nature of the Company or its enterprise as a result of (1) transfer of the enterprise or practically all of the enterprise to a third party or (2) entering into or breaking off a long-term partnership of the Company or a subsidiary thereof with another legal entity or company, or as fully liable partner in a limited partnership or general partnership, if such partnership or its termination represents a fundamental change to the Company;
  3. taking or disposing of a participating interest in the capital of a company to a value of at least a third of the amount of the Company’s equity according to the balance sheet with explanatory notes or, in the event the Company draws up consolidated balance sheets, according to the consolidated balance sheet with explanatory notes, according to the most recently adopted annual accounts of the Company, or any of its subsidiaries;
  4. changes to the Company’s articles of association;
  5. affecting a merger or division.

Please refer to the Corporate Governance Statement for the conditions for holding the priority share and the special control rights associated thereto if that voting right and/or voting instruction can be exercised or given for 50% or less.

Protective measures

The Company has entered into a call-option agreement with regard to preference shares with Stichting Continuïteit ForFarmers (ForFarmers Continuity Foundation). This Continuity Foundation was established to safeguard the identity, strategy, independence and continuity of the enterprise affiliated with the Company. Stichting Continuïteit ForFarmers is fully independent and has independent management. Furthermore, Coöperatie FromFarmers U.A. holds a priority share to which rights are associated as provided for in the Company’s Articles of Association.

The appointment of Executive Board members furthermore only occurs by binding recommendation from the Board, and material decisions of the General Meeting of Shareholders (such as issues of shares, dividends, amendment to the articles of association, mergers, divisions and demergers) may only be made on the proposal of the Executive Board with the approval of the Board.

 

2.5.3 Branch offices

The Company itself does not have branches outside the Netherlands. For the list of main subsidiaries (including foreign subsidiaries) of the Company, a reference is made to Note 33 of the notes to the consolidated financial statements.

2.5.4 Independent auditor's report

The auditor’s report with respect to the consolidated financial statements and the company financial statements is set out on the next pages.

2.5.5 Sustainability assurance report of the independent auditor

The sustainability assurance report is set out on the next pages

2.5.6 Overview financial history

Consolidated statement of financial position
In millions of euro 2018 2017 2016 2015 2014
Intangible assets and goodwill 168.0 96.2 102.2 89.2 77.3
Property, plant and equipment 261.6 205.9 194.7 197.7 190.3
Financial fixed assets 41.8 37.1 36.7 36.2 34.7
Non-current assets 471.4 339.3 333.6 323.1 302.3
Current assets 402.3 448.0 442.7 458.9 396.2
Total assets 873.7 787.3 776.3 782.0 698.6
 
Equity 435.6 405.3 424.1 402.5 363.9
Non-controlling interests 5.2 4.6 4.9 4.6 4.4
Total equity 440.8 409.9 429.0 407.2 368.2
Non-current liabilities 142.5 111.9 131.8 135.9 138.5
Current liabilities 290.5 265.5 215.5 239.0 191.8
Total liabilities 873.7 787.3 776.3 782.0 698.6
 
Capital employed 434.5 417.0 415.4 470.2 420.3
Net debt 17.1 -67.1 -61.5 -33.3 -25.7
Solvency ratio(1) 50.4% 52.1% 55.3% 52.1% 52.7%
Equity as a percentage of total liabilities 101.8% 108.6% 123.5% 108.6% 111.5%
 
ROACE on underlying EBITDA(2) 23.0% 24.3% 22.5%    
ROACE on underlying EBIT(3) 16.4% 18.2% 16.3%    
 
(1) Solvency ratio is equity divided by total assets.
(2) ROACE means underlying EBITDA divided by 12-month average capital employed; see Note 28 of the financial statements.
(3) ROACE means underlying EBIT divided by 12-month average capital employed.

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Consolidated statement of profit or loss
In millions of euro 2018 2017 2016 2015 2014
Revenue 2,404.7 2,218.7 2,109.0 2,244.5 2,221.3
Gross profit 443.4 419.8 407.4 424.2 393.7
Operating profit 75.9 74.0 67.8 64.1 62.6
Net finance costs -4.4 -2.4 -3.5 -2.6 -4.6
Profit before tax 74.5 75.5 68.1 66.2 62.6
Profit for the year 59.2 59.3 53.8 51.3 49.0
Profit attributable to shareholders of the Company 58.6 58.6 53.3 50.7 48.1
 
Compound feed (x million tonnes) 6.95 6.67 6.33 6.34 6.36
DML (x million tonnes) 2.78 2.57 2.61 2.45 2.30
Fertilizer (x million tonnes) 0.14 0.17 0.18 0.12 0.09
Other (x million tonnes) 0.15 0.14 0.14 0.13 0.01
Volume Total Feed (x million tonnes)(1) 10.02 9.55 9.26 9.04 8.76
 
Number of employees at year-end (in fte's) 2,654 2,325 2,273 2,370 2,286
 
Underlying EBITDA(2) 100.1 101.4 93.6 90.4 86.5
Underlying EBITDA as % of revenue(3) 4.2% 4.6% 4.4% 4.0% 3.9%
Underlying EBITDA as % of gross profit(3) 22.6% 24.2% 23.0% 21.3% 22.0%
 
Underlying EBIT(2) 71.5 75.8 67.6 64.4 59.6
Underlying EBIT as % of revenue 3.0% 3.4% 3.2% 2.9% 2.7%
 
Underlying profit(2, 3) 57.6 60.1      
 
Dividend (€ million) 30.1 30.2 25.7 24.7 18.7
Dividend per share (€)(4) 0.30 0.30 0.24 0.23 0.18
 
Impact of acquisitions and divestments on Revenue 3.6% 2.9% 1.5% 2.0%  
Impact of acquisitions and divestments on Gross profit 2.3% 0.9% 0.7% 2.0%  
Impact of acquisitions and divestments on Operating profit (EBIT) -3.2% 4.3% 3.0% 0.2%  
Impact of acquisitions and divestments on Operating profit before depreciation (EBITDA) 0.6% 3.7% 2.6% 0.1%  
 
(1) Prior year volume amounts have been adjusted to conform to the current year presentation
(2) Underlying metrics are Alternative performance measures (APM) not defined by IFRS. These measures are used as the Group believes they provide a better perspective of ForFarmers' business development and performance. For a reconciliation between IFRS measures and underlying measures, reference is made to Note 27 of the financial statements.
(3) Underlying profit is a new APM
(4) 2018: €0,283 per ordinary share and €0,017 special dividend

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