Siclaé – Plant matter is at the heart of our industries

Undeniably the extension of Siclaé, with two new arrivals: in the summer of 2010, that of 15 cooperatives that, previously, were only with us through intermediary holdings and which are now direct shareholders. And the arrival of new financial partners: Fonds Stratégique d’Investissement (FSI), which owns 11 % of our capital, and then in December 2010, Unigrains and Crédit agricole du Nord-Est, which both own 2.2 % of the share capital.
FSI, which represents the French government, brings us resources and a strong guarantee, as well as being testimony to the recognition of the work we have done over the last 50 years, processing farming produce. In this context, where we have widened our shareholding, the cooperatives have 100 % control over the general partner (SICOM) and still own over 62 % of the share capital. Therefore, the cooperatives retain control over Siclaé, as they always will, through their status as General Partner. And finally, I would like to hail the arrival of Mrs Brunel, who has joined SICOM as a partner. This eminent geographer and economist, who lectures at Paris-Sorbonne and is a member of the Belgian Royal Academy, is a recognised specialist in sustainable development, for which she has high expectations. She will feature strongly in the development of our growth strategy and its relationship with societal requirements.

It focuses on the issue of value creation, on which all the other issues depend, in particular that of risk management in an international context marked by high levels of uncertainty. The other key issue is the search for systematic synergies between subsidiaries. This started a few months ago, with the replacement of a product-oriented approach with a customeroriented approach, which requires a reorganisation of the group that we will work on in 2011-2012. But what is important today is that Siclaé is in a virtuous circle and that results are in line with the commitments that we made last year.

Above all, the last year has allowed us to prove the solidity of our model:We have reached the 4 million tonne mark for plant matter processed, and our results will be around the same as last year, which is in line with our objectives. This observation is true of all Siclaé’s subsidiaries, and I applaud their teams, who have been able to strengthen their commercial positions, improve their production processes, react to the spectacular rise in raw materials prices and, in the end, achieve results that will generate dividends. Because the purpose of Siclaé is indeed to allow our members and shareholders to benefit from the value created, while processing our farming produce as close as possible to its point of origin, in order to develop our region.

Yes, it has undergone signifi cant structural changes, with the arrival of seven new members. Gérard Husson, who is a cooperative director and represents the 15 partner cooperatives, was appointed administrator at the 2010 AGM, along with Mr Jacquemin, from Champagne Céréales’ administration committee. Two other administrators were co-opted to succeed two colleagues in January: Mrs Lemarchand, a member of Areva’s Supervisory Board and representative of Fonds Stratégique d’Investissement (FSI), and Mr Schoellen, administrator of Champagne Céréales. In accordance with what was agreed, three censors now accompany us in our work: Thierry Aubertin, director of Crédit Agricole du Nord Est and representative of NECAP; Pierre-Olivier Drège, director of Unigrains; and Sébastien Moynot, investment manager at FSI. The censors are involved in the Supervisory Board’s work, but have no voting rights.

Yes, and the challenge for me was to get farmers – with their sensibility, concerns, and rather long-term view – to work alongside people from the financial world, who bring their skills and experience, but who have more short-term profitability demands. I am very careful to ensure that the Board is a place for constructive discussion - where we deal with real issues and debate fundamental subjects - and not just a rather formal management body. On the whole, the challenge has been met, thanks, in particular, to the quality of the management team’s work, which I applaud. It has allowed us to hold lively and positive debates. At this point I am, therefore, satisfied with how the Board works; everyone feels comfortable and can express themselves freely, independently and relevantly.

Yes, and particularly through a reinforcement of the management team. FSI encouraged us to set up two committees, which its administrator sits on: a remuneration committee and an audit committee. The latter has started three projects: The mapping of operational risks, on which a report was completed at the end of April; the management of price risks; and fi nally, the defi nition of the subsidiaries’ investment process, with the preparation of a list of validation criteria. This work has enabled us to show that price risk is well managed by the subsidiaries on the whole, but that we could strengthen the operational control of Siclaé group to further improve it. The risk mapping showed the sensitivity of the companies to the different risks inherent to any activity. For example, the risks related to energy, exchange rates, raw materials, etc. It enabled us to quantify them and implement control measures. And fi nally, the committee has called on the services of a consultancy fi rm to defi ne an investment procedure for all subsidiaries. So we can see that Siclaé is in the process of organising itself like a real
group.

Siclaé has had another good year and the results obtained are satisfactory. Concerning the share value, our objective is a regular and signifi cant increase in share value. The objective will be achieved this year with an increase in the share price, to which we must add the dividends set by the next annual meeting. In the current financial climate, this was a great achievement, which consolidates our shareholders’ investment. Even if we may have ups and downs, we remain fundamentally optimistic in the success of our project. We are working in real industries, which have meaning, based on companies that are vertically integrated from the product to the end user, the skills of the Group’s employees, and on a stable shareholding with a shared vision.