Agropur cooperative reports growth and solid financial health in 2013

LONGUEUIL, QC, Feb. 12, 2014 /PRNewswire/ - Agropur Cooperative today held its 75th Annual General Assembly with some 600 members, employees, business partners and guests from the Agri-Food industry in attendance, and reported solid financial health and a strong market position, enabling it to step up its growth going forward.

For the fiscal year ended November 2, 2013, the Cooperative's revenues were $3.8 billion and its EBITDA was $264.4 million. Excluding the effect of the additional week in 2012, revenues and EBITDA increased by 7.0% and 10.1% respectively. Agropur declared $110.5 million in patronage dividends in 2013 and members' equity passed the billion-dollar mark for the first time.

"We are pleased with our 2013 results," said Robert Coallier, CEO of Agropur. "Competition in Canada remains at a rarely seen level but Agropur was able to grow and maintain solid financial health thanks to tight management and strategic initiatives undertaken throughout the year that support our cooperative's development and longevity."

Development strategy
Agropur continued implementing its development strategy in 2013 with, among other things, a successful merger with Farmers Co-operative Dairy. "The merger created a major Canadian cooperative whose products and brands enjoy an enviable reputation across the country," commented Serge Riendeau, President of Agropur. "The combination of the two organizations clearly shows that it is possible to capture synergies while keeping processing assets in the hands of the cooperatives' producer-members."

In the course of 2013 and the first weeks of fiscal 2014, Agropur acquired Foremost Farms USA's dry blending business, Cook's Dairy, Coast Mountain Dairy, M. Larivée international Inc. and Damafro. By means of these acquisitions, Agropur is expanding its activities and advantageously positioning its brands in their respective markets.

Investment in our brands
In view of the highly competitive environment in 2013, the Cooperative decided to invest in its brands in order to strengthen its differentiation in the marketplace. A $45 million project aimed at expanding and modernizing the Oka, Quebec plant was approved. The organization is also planning to make major expenditures to support OKA, a leading brand with a tradition dating back to 1893.

Meanwhile, the iögo yogurt brand made by Ultima Foods, a joint venture with Agrifoods, celebrated its first birthday. It is achieving a leadership position, driven by more than $100 million in investments since its inception. Today, with market shares of 14%* in Quebec and 10%* in Canada, iögo is a resounding success especially considering the fiercely competitive landscape.

Innovation at Agropur
In 2013, the Cooperative focused on its manufacturing processes, management processes, business approach and issue management, enabling it to increase its overall efficiency and exceed its operating cost reduction target. After one year, Agropur has achieved an annualized savings rate of $35 million and is on track with its annual 2015 target rate of $75 million.

In 2013, Agropur invested $155 million in various projects, including its facilities in Luxemburg, Wisconsin and Lethbridge, Alberta. It will continue investing in its infrastructures in order to expand its production capacity and also acquire state-of-the-art-technologies to meet growing customer demand. At the same time, Agropur is spending a considerable amount to implement a single IT platform for the management of all operations.

Canada-European Union Economic and Trade Agreement
Agropur supports supply management, which provides the Canadian dairy industry with conditions that enable planning for profitable farm operation in a conducive environment for the planning of processing operations.

"The economic and trade agreement between Canada and the EU, and the eventual import of 17,700 additional tonnes of European cheese per year, will place the system, the dairy industry and our organization under enormous pressure," said Serge Riendeau, President of Agropur. "We will pay particular attention to the length of the transition period and to the quota allocation system in order to minimize the negative impacts on cheese markets."

75 years of passion and vision
In 2013, Agropur marked the 75th anniversary of its foundation, an occasion to recall its visionary founders and builders, who were driven by a desire to take control of their own affairs, take their future into their own hands and compete with the best. Created in 1938, the Société coopérative agricole du canton de Granby has grown into a flagship of the dairy industry in Quebec, then Canada and now North America through some 130 mergers and acquisitions over the years.

"Our ability to transform challenges into business opportunities is a unique talent that has helped make Agropur what it is today," said Serge Riendeau. "We will continue drawing on this talent going forward to accelerate our growth and increase our global market share."

About Agropur
Founded in 1938, Agropur is an important player in the North American dairy industry. With sales of more than $3.8 billion, the Cooperative is a source of pride for its 3,348 dairy producer owners and 6,300 employees. Agropur processes more than 3.3 billion litres of milk per year in its 31 plants across North America and boasts an impressive line of products that includes such prestigious brands as Natrel, Québon, OKA, iögo and Olympic (joint venture - Ultima Foods), Farmers, Agropur Signature, Central Dairies, Agropur Grand Cheddar, Sealtest and Island Farms.

www.agropur.com

* : A.C. Nielsen

SOURCE Agropur