VION Food Group

Nuffield CSC

Page 2

VION Food Group, profile

International food company Turnover € 8,9 billion 27,000 employees Head Office

Eindhoven, the Netherlands

Mission VION wants to be the reliable partner in the food chain, offering our customers and consumers high-quality food and ingredients of agricultural origin.

Objective VION wants to become a leader in (selected) food, ingredients and service market segments

Motto Passion for Better Food

VION, one shareholder, farmer listed

FOOD INGREDIENTS

Pork, beef, poultry, lamb Convenience products

ZLTO/NCB Ontwikkeling

Executive board

Ingredients (i.e. Fat, Proteine, Gelatine)

NL DE UK Int.

Core activities

Supervisory board

Int.

VION Locations

VION Food Netherlands VION Food Germany VION Food UK

VION Food International VION Ingredients

VION products

Fresh Meat

Convenience

Ingredients

MIXING SYSTEM FOR RAW MATERIALS VION has developed a mixing system named BASICS which is suitable in all product areas: various sausages and cold meats. The benefits: .. Standardization of raw materials .. Exact amounts and fat levels. .. Optimum freshness. .. Time savings through process optimization. .. Savings in de-boning and processing.

FARMINGNET IS AN AUTOMATED SYSTEM It provides pig breeders with a speedy and clearly structured supply of abattoir data via the internet. With Farmingnet, the farmers obtain – among other things – valuable feedback, including slaughter and slaughter results data and the option of a free benchmark with other pig breeders, i.e. management data which will be of considerable financial benefit for them and help increase the business success of their pig-breeding operations.

VION tools to interact with (primary) sourcing

VION Ingredients VION Food

Sourcing Marketing

& Sales

Farmers Processing Retail Foodservice Food Industry

VION’s position in the Pork Chain

40%

60%

40%

‘Creating value on raw materials’

40%

Reduction of failure costs

Reduction of failure costs

Increasing energy efficiency

Farmer listed spearheads

1. Bottom line management: Improve bottom line result of farmers by use of FarmingNet and advise

2. Programme ‘Partnership in business’. Programme aimed at strengthening our relations with suppliers and other stakeholders.

3. Supply chain management: Improve supply chain efficiency

4. Conceptmanagement Convert societal demands regarding sustainability and animal welfare into attractive (triple P) market concepts.

5. Active Public Affairs / CSR policy Convert societal issues in effective supply chain policies

Assisting producers to become the best

Reduction in the failure costs Faster exchange of information = gain profit

VION in business together

with farmers

Profit Meetings (2x year):

practical, educational

Face to face management

assistance

FarmingNet

Working with suppliers to ‘reduce failure cost’

VION ‘FarmingNet’ an IT system

providing rapid internet feedback to

producers on the previous days kill.

KPI’s on weight, grade and health plus

trend and benchmarking data are

provided

Figures are all related to price per kilo

aimed at driving improvements – a

better pig to meet retail needs.

Too heavy

Too light

Too fat

And t

heir

im

pact

on p

rice

Development of Manure Processing

Feasibility study for a manure 125,000 ton/year processing plant, including digestion

Ecoson decreases costs for farmers for manure disposal

Manure processing

-

10.000

20.000

30.000

40.000

50.000

60.000

2007 2008 2009 2010 2011 2012

Excess manure in the Netherlands

High costs

Future limit for pig production

Electricity

Effluent

Solids

Electricity

Waste water

treatment plant

Refinery

C1 processing plant

Unique concept

Gly

cerin

Digester

Manure

Biodiesel

Sourcing Marketing

& Sales

Processing Retail (Europe)

Foodservice (Europe)

Food Industry (World)

Business models in pork supply chain From farmer listed to listed

Integrated supply chain Processing, Marketing & Sales

Coöps Listed:

- Danish Crown (Coöperative) - Unilever

Listed: - Nestlé

- Smithfield (Vertical integration)

Farmer listed:

- VION (Strategic shareholder)

40%

60%

40%

Valorisation ‘Byproducts’

40% Pig farmer (NL/DE/UK)

Cattle farmer (NL/DE/UK)

Poultry farmer (UK)

Sheep farmer (AS/UK)

Vegetable / Potato grower (NL/PL)

Competitor benchmark global top 3 pork players

Source: 2007 Annual report, SEC 2007

6,35,9

6,56,5

6,0

5,4

7,8

7,17,5

6,7

5,4

4,0

9,6

7,17,4

6,35,9

2,9

2008 2007 2006

VION

Smithfield

Danish Crown

2005 2004 2003

161174

234

97

-26

233223

208

251249

205

153

118114

85

VION

2007

Danish Crown

Smithfield

2006 2005 2004 2003

Thank you