2009 2010
CRV ANNUAL REPORT 2009-2010
2009 2010
Content
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CRV ANNUAL REPORT 2009-2010
message from the chairman
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about CRV
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MAJOR EVENTS
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CLOSE TO THE CUSTOMER
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PROGRESSIVE BREEDING
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SUSTAINABLE BUSINESS PRACTICE
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GENERAL COURSE OF EVENTS OF CRV HOLDING
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CONTACT
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MESSAGE FROM THE
CHAIRMAN Close to the customer, strong in the world CRV has a financial year behind it that was characterised by a difficult start and a good finish. In the first six months, sales came under pressure due to low milk prices throughout the world. A cautious recovery in prices in the second half of the fiscal year and extra focus on cost control allowed CRV to note a good financial result. CRV has optimised its operational processes in this financial year. Business units have been created in various parts of the world so that we can be closer to our customers. These business units are supported from the Head Quarters in Arnhem. This has allowed CRV to unite its forces worldwide and that combining of forces is also taking place by entering into joint ventures, such as EuroGenomics and the Grassland Alliance. CRV is shifting its focus from offering individual products to offering customised packages that match the individual wishes of the cattle farmer. The combining of forces and the innovative solutions offered to cattle farmers have resulted in CRV being voted the most innovative agricultural business in the Netherlands in both 2009 and 2010. The 2009-2010 financial year was the first financial year for the new offspring of the CRV family: CRV USA and CRV Meggle. Both have met the expectations. The youngest member of the family is BOS Trading (now CRV Australia) of which CRV became 100 percent owner. CRV is a healthy enterprise with motivated staff and involved members. This combination is a formula for success that allows us to provide our customers with optimum service, both now and in the future.
Evert Alderkamp, Chairman CRV
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about CRV Profile CRV is an international enterprise in the field of cattle improvement. The shareholders are the Dutch Co-operative CR Delta and the Flemish Co-operative VRV. Since 1 September 2009 CRV has been working on establishing a new international structure based on business units. These units are active in the countries that surround them so that customers can always be served in their own time and culture zone. The illustration below shows the areas in which the business units are active. The Global Sales & Development business unit serves customers in countries that are not (yet) covered by other business units. CRV’s products and services are delivered to approximately 60 countries.
Head Quar ters
Head Quar ters
Mission CRV is a leading customer-focused cattle improvement co-operative, fully committed to adding value for farmers.
Strategy CRV aims to further consolidate its leading position in the field of international cattle improvement. It intends to achieve this by responding quickly to changing market requirements and by offering innovative solutions and concepts that answer the needs of its customers: dairy and beef cattle farmers worldwide. To continue delivering high-quality products and services to its customers in the future, CRV is aiming to achieve increased international growth and healthy financial business development. This international approach is also important for spreading veterinary risks. As a co-operative, CRV wishes to support the operational management continuity of its members and customers and cattle farmers therefore have a major influence on CRV policy via advisory bodies and member committees.
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CRV ANNUAL REPORT 2009-2010
CRV Executive Board – R. M. A. (Roald) van Noort Chairman of the CRV Executive Board Executive Director Marketing, Innovation & Staff – A . (Ate) Lindeboom Executive Director Operations & Development – J. F. H. M. (Joop) Kersten Executive Director Finance & Organisation
CRV Supervisory Board (as of 31-8-2010) – E. J. F. Alderkamp, Zevenaar – Chairman – N. A. L. van Leeuwe, Sint-Margriete – Vice-chairman – B. E. G. ten Doeschot, Hengelo – L. M. J. M. Cox, Roermond – C. Gorter, Makkinga – P. E. van der Grift, Bunnik – H. L. M. Hermsen, Havelte – D. R. M. Ryckaert, Dikkelvenne – H. Schonewille, Zuidwolde – M. A. Siebenga, Lelystad – B. Uyttendaele, The Hague – M. D. L. Y. R. Vernimmen, Brasschaat The CRV Supervisory Board
The CRV Executive Board: Ate Lindeboom, Joop Kersten and Roald van Noort (sitting)
Departure of Hans Huijbers On 4 March 2010, Hans Huijbers bade farewell to CRV after eight years as Chairman of the Supervisory Board, a period which witnessed many changes. These changes started immediately in 2002 with the collaboration between the cooperatives CR Delta in the Netherlands and VRV in Flanders. The outcome of this was CRV. This was followed in 2003 by the collaboration with AWE (Wallonia, Belgium) in the Belgian Blue Group and then by CRV acquisitions in the Czech Republic, New Zeeland and, more recently, in Germany. As Chairman, Hans Huijbers has played a major role in the development of CRV and in so doing was always able to find the right balance between his role as Chairman and that of a practical cattle farmer.
Hans Huijbers was honoured with a Royal decoration for his managerial work. The flowers were well received by his wife Marian Huijbers
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major events September 2009 • Five European cattle breeding organisations, UNCEIA (France), DHV and vit (Germany), Viking Genetics (Denmark, Sweden, Finland) and CRV enter into a joint venture under the name EuroGenomics in order to further improve results in the field of genomic selection. The combining of what are known as reference populations considerably increases the reliability of the genomic breeding values of CRV’s Holstein bulls. (pag. 12). • CRV acquires the German organisation Meggle Besamungsstation on 1 September. The organisation is now known as CRV Meggle and is a leading organisation in the field of Fleckvieh cattle breeding (pag. 13). • CRV launches a new service in Germany called CRV FertiPlan which is aimed at improving fertility results (pag. 13).
Holstein cow in South Africa. The 10 year old cow is classified EX94. Besides her excellent conformation she is also a super producer, yielding more than 12,000 kg in her second lactation. Suzie comes from an enduring family with her dam, Manko Sunny Boy 08, being a Sunny Boy daughter with a lifetime production of more than 86,000kg in seven lactations.
October 2009 • The CRV annual statistics show that lifetime production of Dutch dairy cows is above 30,000 kg for two successive years. November 2009 • Dutch weekly farming magazine ‘Boerderij’ declares CRV to be the most innovative company in the Dutch agricultural business. A shared first place was also achieved for the sustainability aspect. • After many successful years, the career of one of the most famous CRV breeding bulls, Himster Grandprix, has come to an end. He passed away at the age of twelve and half years. During his lifetime, Grandprix (Lord Lily x Mascot x Tops) produced almost 1.2 million semen straws and was popular in large parts of the world. December 2009 • CRV launches SixPack SiryX, sexed semen from InSire bulls. • The South African Addison daughter of Manko Addison Suzie, is the highest scoring, living
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During his lifetime Grandprix produced almost 1.2 million semen straws
January 2010 • Cattle improvement organisations Alta, KI Kampen, CRV and VRV, working in close collaboration with Wageningen University, have established the GES Foundation. The foundation is responsible for estimating breeding values of Dutch and Flemish bulls and its aim is to guarantee to guarantee the continuity and the quality of these values. February 2010 • CRV and NCBC have entered into a joint venture under the name ‘Grassland Alliance’ in order to provide services to farmers who manage their herds on grazing systems. This joint venture means that CRV has become the largest player in this field (pag. 21). March 2010 • After having worked for more than 20 years as a Director in the cattle improvement business, Hans Huijbers has retired as Chairman of CRV. • Dairy farmer Evert Alderkamp from Zevenaar, the Netherlands, will be replacing Hans Huijbers as Chairman of the Supervisory Board of CRV. • Figures from Germany show that for the third year in a row Vanstein has been the most widely used Fleckvieh cattle bull in Germany. Vanstein is jointly owned by CRV Meggle and the German AI organisation BVN. • A Classic daughter out of Massia 21 (s. Lentini) became overall champion at the Agro Nord Show in Denmark.
Trading Australia. This acquisition strengthens CRV’s position in Australia (pag. 11). • In the Netherlands, CRV launches CRV DrachtWacht Pro. This application allows a cow to report itself on heat via a pedometer, which is followed up, amongst other things, by bull advice (pag. ..). • At the All Holland Dairy Show 2010 the CRV daughter groups show that excellent production capacity can be combined perfectly with a beautiful and functional conformation and high longevity. • Classic was the top producer for red and white cattle during the individual judging at the NRM show. No less than four titles go to the daughters of this top conformation CRV bull. July 2010 • Butembo moves to Russia. CRV has sold him to Moskovskoye, the largest artificial insemination organisation in Russia.
April 2010 • CRV becomes one of the first breeding organisations in the world to introduce a breeding value for hoof health (pag. 28). May 2010 • The dam of Surprise, Aaltje 154, has exceeded the 10.000 kg fat and protein threshold. She was also in the news in 2008 when she reached the 100 ton milking milestone before she reached the age of ten. June 2010 • CRV has become the 100 percent owner of BOS
The daughters of Jan and Gerrie Hoegen from Garderen with overall red and white champion at All Holland Dairy Show 2010, Classic daughter J&G Trilux 18
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• In an annual show organised by the Catholic University of Santa Maria in Arequipa, Peru, CRV progeny impressed the 2000 visitors. December daughter Dina won the grand champion title.
CRV bulls for the first time in the Netherlands and Flanders. This also means that a new list of young genomic bulls is available. CRV will be marketing a number of these bulls.
August 2010 • During the August indexation, genomic information was integrated into the breeding values of the
Classic was the top producer for red and white cattle at the NRM show
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CR DELTA CRV ANNUAL U.A.-JA REPORT ARVERSL 2009-2010 AG 2007-2008
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Close to the
customer As a company with a co-operative background, CRV has the task of contributing to the continuity of the farmyard. CRV therefore wishes to offer products and services that meet the needs of customers and which are of the best quality at an acceptable price. Growth is necessary in order to continue to be able to develop such innovative products. Collaboration, both internally and with other parties, is very valuable in achieving this.
Close to the customer through collaboration ‘CRV is one’ CRV wants to be close to its members and close to its customers. To achieve this it is important that the staff at CRV operate well and are able to work together intensively at international level. This allows the knowledge and the skills within CRV to be used internationally in order for improved products and services to be offered. Through collaboration, CRV is able to gain from the benefits of scale and can therefore offer its members the best price / quality ratio. That is why CRV introduced a new business structure on 1 September 2009. As already stated, the essence of this structure is that there will be a number of international business units able to promote the interests of CRV using the language and/or cultural signature of the respective countries. These business units have a great deal of knowledge of the local markets and the local customers. They work together and are supported from the Head Quarters in Arnhem, the Netherlands. This
CRV staff attended a conference to gain greater insight into the Fleckvieh cattle breed
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brings CRV close to its customers and allows it to act decisively in the market. An example of the synergy and the collaboration between the business units was the organisation of an international Fleckvieh cattle conference in May 2010 by the Central Europe business unit in conjunction with the CRV Head Quarters. Participants from throughout the world attended this conference to learn about the Fleckvieh cattle breed and to subsequently be able to provide better advice to customers in their own country. New structure offers new possibilities CRV AmBreed from New Zealand is also reaping the rewards of the new structure. Since 1 September 2009 it has formed the Oceania business unit. Later in the year the business unit was expanded with the acquisition of BOS Trading in Australia. As part of the new structure, CRV AmBreed has become a more identifiable part of CRV. As a result of this doors are opening that once remained closed. The two major universities in New Zealand, Lincoln University and Massey University, have stated their intention to make bursaries available for students wishing to undertake work placements at CRV. CRV AmBreed has also been successful in attracting and retaining new and significant customers. CRV AmBreed signed a two-year contract with the largest dairy cattle business in New Zealand: Landcorp. This business numbers 44 farms with a total of 39,000 cows.
Acquisition of BOS Trading CRV has become closer to its customers in Australia by gaining 100% ownership of BOS Trading. CRV had already been co-owner of this company since 2003. The acquisition represents a further strengthening of CRV’s position in Oceania.
Calves in New Zealand
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Working together to find solutions CRV wishes to help cattle farmers achieve their aims by providing new insights and useful solutions. To be able to do this in a focussed manner it is essential to understand customer needs. CRV has therefore launched an international study into the needs of its customers worldwide. Combining forces to increase reliability September 2009 saw the launch of the European joint venture EuroGenomics. The joint venture was established by CRV and four European partners: the French national association of livestock and AI co-operatives, UNCEIA, the German national umbrella organisation for Holstein breeding, the German cattle statistical data centre DHV and vit, and the Danish/Finnish/Swedish cattle breeding organisation VikingGenetics.
The “CRV Fertiplan” is a service that allows farmers to improve fertility on their farm
The customers of the EuroGenomics partners, and thus those of CRV, can gain enormous benefits from this important joint venture. The accuracy and the reliability of the breeding values based on genomic selection are increasing because of the combining of reference populations. A reference population is a group of bulls for which the breeding values are calculated on the basis of daughter information and their DNA profiles. A population such as this provides breeding organisations with the essential basis for calculating reliable genomic breeding values. The first exchange of data has resulted in an eight percent increase in the reliability of these breeding values. This is a good example of how effective collaboration between European countries can lead to a new international standard from which dairy farmers can benefit. The partners have agreed that the genotypes of the new bulls with breeding values will be exchanged every six months.
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New to the market During the last financial year CRV has been working hard on the development and improvement of products to support dairy and beef farm management. This has resulted in many new products. One of the most innovative in the Dutch market is called “DrachtWacht Pro” This product has been developed in collaboration with the automation firm Nedap. Nedap supplies the pedometers and CRV links the data supplied by the pedometers to VeeManager. Cows in heat are then reported automatically to VeeManager. On the basis of automatic bull advice the cattle farmer is then able to select the best bull and register the cow directly via the computer with the inseminator for insemination. Gestation monitoring is subsequently undertaken. The process from heat to gestation has thus become a great deal easier. The “CRV FertiPlan” was launched in Germany. This service allows cattle farmers to improve fertility on their farm. Dutch and Flemish fertility specialists are used to advise cattle farmers about all the aspects relating to fertility. In addition to this, the international bull advice program, SireMatch, was completely revamped. During this financial year, this program was used in Luxemburg, Germany, Denmark, Brazil and the Czech Republic.
Close to the customer through growth Strong presence in Fleckvieh cattle On 1 September 2009 the German breeding organisation Meggle Besamungsstation became part of CRV. The name was changed to CRV Meggle as a result of the acquisition. Combining the forces of CRV and CRV Meggle strengthens the cattle improvement activities of CRV in Germany and will also create a strong
Fleckvieh cattle bulls at CRV Meggle’s AI station in Wasserburg
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position in the international Fleckvieh cattle market. Both CRV in the Czech Republic and CRV Meggle have substantial testing capacity for this breed, which now includes more than one hundred bulls. In addition, CRV Meggle also has access to 65 bulls that are tested in conjunction with partners. As a result, cattle farmers can gain access to an even broader range of top-quality bulls and CRV is able to meet the increasing demand from the Netherlands and Flanders for Fleckvieh cattle bulls. CRV Meggle’s first year was immediately very successful. For example, seven of the top ten Fleckvieh cattle bulls in Germany came into the possession of CRV Meggle. Two percent more initial inseminations were performed than in the previous year and market share grew. And CRV Meggle was not just successful in its home market; international sales also increased to Brazil, Turkey and China for example.
Close to the customer: support CRV’s aim is to support customers in managing their stock via products as well as in other ways. For example, during this financial year CRV CZ in the Czech Republic organised the traditional conferences for cattle farmers during the months of November and December and for the first time CRV CZ also organised a conference in neighbouring Slovakia. This year around 600 cattle farmers attended the conferences, the theme of which was cost-price reduction.
Launch of CRV USA CRV is also literally getting closer to its customers. On 1 September 2009 the doors of its latest branch, CRV USA, opened in Madison, USA. CRV USA has a unique position amongst the various parties vying for business. It offers a wide range of reliable and innovative products, as a result of which it can deliver added value for cattle farmers. For example, CRV USA sells InSire and SiryX semen as well as Fleckvieh cattle bulls from the Czech Republic and the special ‘grazing bulls’ from New Zealand. Sales of grazing bulls exceeded all expectations and this has significantly contributed to the outstanding results achieved for CRV’s first year in the United States. Spectacular growth in South America From North America to South America. CRV Lagoa in Brazil has experienced spectacular growth. In the 2009 calendar year 20% more doses of semen were sold than in the 2008 calendar year. In 2009 CRV Lagoa sold more than two million straws of semen and in so doing reached an exceptional milestone. CRV Lagoa’s growth can be contributed to a large extent to its power of innovation and its high standard of quality. The CRV Lagoa Data Logger
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An example of this is the “Data Logger” that was developed by CRV Lagoa. This unit automatically measures the nitrogen temperature of a nitrogen vessel every two minutes during transport from the distribution centre to the customer. The customer receives a printout of the temperature recorded during the trip. This allows CRV Lagoa to guarantee outstanding semen quality. In April 2010 CRV Lagoa opened its refurbished logistics centre which now has increased storage space and new semen tanks.
The Nelore is a very important meat breed in South America
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Progressive
breeding CRV is progressive in its breeding policy. During this financial year the Holstein breeding program has changed as a result of the developments in the field of genomic selection. This year the InSire bulls also became widely available.
International breeding program In order to meet customer wishes worldwide in the best possible way, CRV has breeding programs for many breeds and in many countries. For example, there is the Holstein breeding program in Europe and there is a Holstein breeding program for grazing bulls in New Zealand, where Jersey bulls are also tested. In Germany and the Czech Republic, CRV tests Fleckvieh bulls and in Brazil CRV tests the Nelore meat breed. In the
Paramount is popular in large parts of the world. This Cooriemungle Paramount 4503 was photographed in Australia
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Netherlands bulls from the MRIJ breed are tested and bulls from the Belgian Blue meat breed are tested in Belgium. During this financial year CRV also launched a Holstein breeding program in the United States. Using genetic marker selection, CRV has selected a few dozen promising young bulls, the majority of which are now in production. These bulls were commercially marketed immediately in the United States.
S&K Lannon Tokoroa is a daughter of the grazing bull Firenze from CRV AmBreed
New bulls Holstein This year the CRV Holstein bulls performed extremely well. In the Netherlands the decade started strongly with the breakthrough of Woudhoeve Impuls, a dream combination of all-rounder O-Man and Woudhoeve Pietjes from the cow family voted the best in the Netherlands. And another leading light, Delta Paramount, saw his first breeding bull daughters come into milk production and increased his conformity score to +114. He is justifiably in the Top 5 of the most sold bulls in the North America and South America business units. In August 2010 a list of young genomic bulls became available in the Netherlands for the first time. CRV marketed a number of the best under the name “InSire Top Bulls”. In the United States, CRV marketed
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young American InSire bulls. One of the promising bulls from this infant breeding program is Pine-Tree Boliver Mandeo-ET. He has a GTPI in excess of 2000 points and scores very well on productive life, somatic cell count and ease of birth. The breeding bulls in CRV’s European breeding program achieved particularly good results in the United States. In August 2010, Goolstar Diamond was No. 1 on the list for foreign tested black & white bulls. His production inheritance is sublime, with substantial positives for both milk kg and grades. The top 3 red & white Holstein breeding bulls consisted of CRV bulls, with Heihoeve Arnold in first place, Delta Fidelity in second place and Van de Peul Kylian in third place. In the country of birth of these three bulls they also won hands down. Delta Fidelity was the most used bull in the Netherlands during the last financial year. Fleckvieh This financial year Epocha appeared in the top flight of the Czech Republic indexes and is the highest available CRV CZ bull. Epocha’s daughters have excellent milk production and a low cell count. Bonsai (s. Levier) is one of the most well-known CRV Fleckvieh bulls. He is well known all over the world for producing excellent udders and frames, good milk production and low somatic cell count. Momo from CRV Meggle is another outstanding Fleckvieh bull. Momo was the most popular bull in the last financial year in the CRV Meggle area. Reichsherr is the second most used bull in CRV Meggle’s home market. Among the CRV Meggle bulls he is also the bull that is most requested for export. Reichsherr produces excellent udders, high milk production, high longevity and his calves are easy to calf. Nelore Nelore is the dominant meat breed in Brazil. The ranking for the Brazilian Nelore bulls was announced at the beginning of 2010 and the top 20 from this list contains eight from CRV Lagoa. They are: Helíaco, Bvlgari, Enlevo, Fajardo, Panagpur, Ranchi, 1646 da MN and Lufo. The bull Missoni, which is also contracted by CRV Lagoa, was crowned champion in the ‘young bulls’ category.
Rosette from Germany is a daughter of the bull Kian, the most sold Holstein bull in the North America business unit
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Ebloui de Wihogne, the most used Belgian Blue bull for pure breeding in the Western Europe business unit
Jersey In 2010, Okura Lika Murmur gained No. 1 position in the New Zealand NZMI index. His protein breeding value marks him out as leader for the breed, with outstanding fertility, somatic cell count, capacity and real quality of the udders he produces, making Murmur a must-have for New Zealand farmers. He comes with a pedigree direct from the cow family that bred CRV AmBreed’s other super sire, Manhatten. MRIJ It was a good year for the MRIJ bulls. In August 2009, Meervelder Markus received his first breeding value and rose 37 NVI [Dutch-Flemish Index] points in the January index run. The April index saw many popular bulls rise, such as Janco van de Vinkenhof, Menno and Christiaan. In August it was the turn of Mondriaan to make great advances in the rankings. Belgian Blue For the Belgian Blue it is conspicuous that the number one and number two of the most used bulls for pure breeding are both new. Fleuron, particularly, was very popular because of his height and Ebloui because of his outcross bloodline, his low mortality score and good conformation. In Flanders 14 Belgian Blues were tested for the pure breeding. One of the most striking bulls among these is Adagio. He is very popular amongst beef farmers because of his de luxe qualities.
Breeding program developments Genomic selection has now become an intrinsic part of modern cattle breeding. During the last financial year, developments in this field have once again followed rapidly, one after the other. As an innovative
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Popular bulls It is noticeable with the sales of semen that a high level of reliability is still one of CRV’s unique selling points. The top of the best sold bulls in the various business units during the 2009-2010 financial year is formed by bulls with stable breeding values, such as Paramount, Kian and Olympic.
Top 5 of the most popular Holstein bulls in the Western Europe business unit
Black & White
Red & White
Black & White
Red & White
Bertil Paramount Surprise Olympic Diamond
Fidelity Kian Arnold Kylian Spencer
Paramount Olympic Canvas Parra Applause
Kian Fidelity Classic Curtis Scooter
Top 5 of the most popular Holstein bulls in the Central Europe business unit
Alfons Yank Yankee Win 395 Diamond
Top 5 of the most popular Holstein bulls in the South America business unit
Applause Parra Olympic Paramount Grandprix
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Top 5 of the most sold Holstein bulls by the Global Sales and Development business unit
CRV ANNUAL REPORT 2009-2010
Top 5 of the most popular Holstein bulls in the North America business unit
Kian Canvas Yank Paramount Fidelity
Top 5 of the most popular Holstein bulls in the Oceania business unit
Olympic Grandprix Ireland Kian Sunflower
With Grassland Alliance CRV aims to provide customers with low-input systems with a wide range of suitable bulls company, CRV has translated these developments into its breeding policy and the breeding program for Holsteins. The increased reliability of the breeding values for young genomic-tested Holstein bulls has allowed CRV to increase the share of InSire bulls used as bull sires to around 25 percent. In the future, double the amount of calves for the Holstein breeding program will be tested for markers. During this financial year 1300 bull calves were tested in the Western Europe Holstein breeding program. The testing of more animals provides a broader view of the top stock. In addition to this, the selection process is becoming more stringent, as a result of which there will be a slight decline in the number of test bulls to be used. In the forthcoming financial year, CRV in Western Europe will be testing 195 bulls. These bulls will be of extra high quality due to the stringent pre-selection process.
Market developments In countries such as Ireland and New Zealand there are many dairy farms that primarily use grass rations for milk production. In South America and in certain parts of North America the numbers of these ‘grazing farms’ are rising. The sale of semen within this grazing segment has increased considerably. This is due to good collaboration between the various CRV business units and the establishment of the Grassland Alliance in conjunction with the Irish breeding organisation NCBC. The Grassland Alliance is intended to allow CRV to be of service to farmers worldwide who work with low-input systems with a seasonal character. This collaboration means that CRV can offer its customers around the world the largest number of ‘grazing bulls’. The bulls from this segment are characterised by passing on inherited high percentages of fat and protein in the milk. In addition to this, the health characteristics in respect of udder health and especially fertility are
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Spreading the risks Because CRV has branches in many countries it is possible to spread the veterinary risks. Within that framework, CRV has planted embryos from Dutch/ Flemish Delta donors into carriers in New Zealand. The bulls born to these carriers are now producing semen. These are: Wizard, Window, Womack, Westmore (see photograph) and Bradley. These bulls still remain in New Zealand.
of essential importance and the grazing system requires cows that calf easily. The sale of SiryX (sexed semen) came under pressure this financial year due to the low milk prices throughout the world. Despite this, many new distributors added CRV SiryX to their portfolio. In the 2009-2010 financial year, the Global Sales and Development business unit expanded its export network. It distributed semen for the first time to Bulgaria, Nicaragua, Bosnia and Morocco.
Embryo program in Brazil In the last financial year CRV Lagoa set up an embryo program for the Holstein and Girolande milk breeds and for the Nelore meat breed. For the milk breed program CRV Lagoa is working together with a number of the best in-country breeders. For the Nelore embryo program CRV Lagoa is working with IZ (the institute for animal science in Sao Paulo) which has a breeding program for Nelore animals. The best animals from this breeding program are flushed with bulls from CRV Lagoa and embryos from these are sold to cattle farmers. As a result of this collaboration CRV Lagoa is able to meet the customer demand for high-quality genetic material. In the four months between launching CRV Lagoa Embryo and the end of the financial year, more than 750 embryos had already been sold.
Breeding innovations For CRV, innovation represents significant importance in its operational management. • A very innovative genetic product brought to the market this year by CRV is InSire SixPack SiryX. This product unites two revolutionary developments. InSire SixPack SiryX is actually sexed semen from genomictested young bulls. The sales figures show that this product is meeting the need of many cattle farmers. • There was a technological breakthrough in the field of genomic selection: genomic selection is now also possible for embryos. • During the financial year CRV also developed a method of deriving marker breeding values from a more compact and less expensive DNAchip. This DNA-chip, called the InSire TalentScan, became available to cattle farmers in November 2010 and is used, amongst other things, for selection decisions and bull selection among young stock. • In the field of animal health, this financial year saw the completion of a large-scale study into improving milk composition via breeding, which was conducted in collaboration with Wageningen University and the dairy industry. The outcomes of this study offer excellent perspectives for, amongst other things, using selection to increase the level of unsaturated fats in milk.
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Record number of embryos The Delta Nucleus forms the core of the CRV’s Holstein breeding program in the Netherlands and Flanders. The Delta Nucleus stock consists of genetically high-quality female animals. Many embryos are obtained from each animal via flushing and OPU. Embryo gathering is currently undertaken as much as possible from yearlings. Cattle farmers buy InSire embryos from the Delta Nucleus to improve their stock. CRV retains the right to buy back the best bull calves and heifer calves for the breeding program. The InSire embryos therefore have a very special place in the breeding program, which is unique in the world. This year the largest number of embryos were sold since CRV started selling embryos in 1996.
Cow experts get together Last financial year the 12th All Holland Dairy Show (NRM) took place in Utrecht, the Netherlands. The genetic advances in recent years clearly came to the fore during the daughter group presentations. There were 10 daughter group presentations, eight of which were being presented for the first time. In addition, this year pure-bred and cross-bred groups were also included in the program for the first time. A pure-bred group of Brown Swiss and of MRIJ were presented in the ring by CRV. Both groups created a very good impression. The individual Red & White classes appeared to be a Classic show. Classic was the ‘dominant supplier’ with 25 daughters. Four of the six titles went to a Classic daughter, including the title of Overall Red & White Champion.
CRV presented an MRIJ pure-bred group during the NRM show
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Sustainable Business Practices
CRV is committed to sustainable development of the organisation and seeks to execute this in practical terms. In so doing, CRV takes its social responsibility for people, animals and the environment very seriously.
Sustainable breeding policy CRV considers a sustainable breeding policy to be of major importance. It wishes to achieve genetic advancement in a responsible manner. CRV achieves this by, amongst other things: – making optimum use of the existing genetic variation in its breeding program; – working on the prevention of genetic defects; – saving semen in the national gene bank; – paying due consideration to breeding values relating to sustainability. This financial year CRV has studied thousands of promising female animals with an outcross lineage for markers. It is in this way that CRV is fulfilling its aim of making optimum use of the existing genetic variation. CRV also meets a need in the market with the outcross bulls that will be bred under this project. The study has produced a number of very interesting new bull dams.
Ethics Committee Since its establishment in 2002, the Ethics Committee (CE) has been an advisory body to CRV’s Executive Board and has been assisting in shaping the social responsibility of the organisation. The Commission provides advice to the Executive Board about ethical issues pertaining to CRV’s activities. Topics dealt with by the Committee during the last year have included the future possibilities of sensor technology and nanotechnology (measuring very small particles that can form an indicator for performance aspects such as production and conformation as well as the health of the animal). In addition to this and considering the topicality of the subject, the Executive Board has assessed its standpoint in respect of cloning against the most recent view of the Ethics Committee. The Committee has also, for example, provided input for the creation of the CRV Code of Ethical Conduct.
Longevity One of the most well-known breeding values relating to sustainability is longevity, which is a characteristic that CRV considers to be of major importance. In CRV’s home market of the Netherlands and Flanders, where a significant element of the breeding program is also undertaken, a great deal of attention is also devoted to longevity and lifetime production. The lifetime production of Dutch and Flemish cows is approximately 30,000 kg of milk. Lifetime production has risen considerably in recent years.
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CRV ANNUAL REPORT 2009-2010
Lifetime production and longevity 2004 to 2010 – Netherlands lifetime production
lifetime production
2.400 31.000
2.300
30.000
2.200
27.000
2.300
23.000
2.200
27.000 25.000
2.100
25.000
2.100
23.000
2.000
2.000
21.000
2002 2004 2006 2008 2010
year of culling
2002 2004 2006
year of culling
2008 2010
1.800
days
1.900
19.000
kg milk
21.000 kg milk
2.400
29.000
29.000
17.000
longevity
1.900
19.000 17.000 2007 2008 2009 2010
2007 2008 2009
year of culling
year of culling
2010
1.800
days
31.000
longevity
Lifetime production and longevity 2007 to 2010 – Flanders
Naturally polled As calves, the majority of HF cows grow horns. A small number are naturally polled. Calves that grow horns are generally dehorned in order to prevent injuries to other animals in the herd. Calves that are naturally polled do not need to undergo this intervention, which is therefore a benefit to their welfare. Interest from cattle farmers for poll-inherited bulls is increasing. CRV now has eight heterozygote polled bulls in its breeding program. This means that half of the progeny from these bulls will be poll cattle. Fasna Asterix is an available InSire bull.
CRV contracted Huijbens Ilona 3 (Ramos x Emil x Lukas) in the outcross project
CRV ANNUAL REPORT 2009-2010
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Animal health and welfare CRV believes that animal health and welfare is of paramount importance. It therefore also develops and finances various initiatives in this field. Reduced dry period project One of these initiatives is the launch of the ‘Why dry’ project. CRV is undertaking this large-scale study in conjunction with researchers from Wageningen University. The aim of the study is to evaluate the length of the dry period from the perspective of cow health. In addition to this, attention is also being paid to calf health, milk production, longevity and economics. Studies are being conducted into whether reducing or omitting the dry period reduces the risk of diseases, such as acetonaemia and fatty liver syndrome, and thus improves cow fertility. Natural resistance CRV is also participating in a large-scale study into the natural resistance of dairy cows. This study has now shown that the natural resistance of dairy cows is inherited to a reasonable extent (approximately 30 to 50 percent) and that, in principle, it can be passed on through breeding. If the natural resistance of the animals is improved through breeding then this is beneficial to the health and welfare of these animals. The study is now also investigating the best practical method for measuring an animal’s natural resistance and to what extent this can predict the risk of disease. Measuring is knowing CRV, the Dutch Cattle Pedicure Association, the Agricultural Mutual Society and the Dutch Animal Health Service have jointly launched the product Digiklauw. This system is used by hoof trimmers to record details of claw disorders encountered during farm visits and to send these to CRV. Via the online management system of CRV (VeeManager) the cattle farmers are then provided with insight into the claw health status
CRV is participating in a large-scale study into the natural resistance of dairy cows
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CRV ANNUAL REPORT 2009-2010
In its breeding program, CRV aims to breed animals that can produce in an ecologically and economically sustainable manner of their farm. The data from this system has allowed CRV to develop a claw health index of the six most common claw disorders. This claw health index was launched in April 2010 and is available internationally. The Digiklauw data and the claw health index help the cattle farmer to improve claw health on the farm.
Ecological sustainability Climate-friendly cow In its breeding program, CRV aims to breed animals that can produce in an ecologically and economically sustainable manner. CRV and Cehave have joined forces with Wageningen University to work on producing a type of climate-friendly cow. Together they have started researching greenhouse gasses in dairy herds. Greenhouse gasses contribute to global warming and stock farms contribute to greenhouse gasses by 15 to 20 percent. In dairy herds this mainly relates to methane and nitrous oxide. The aim of the research is to develop feeding and breeding strategies that reduce the emission of greenhouse gasses. The results from the study will also allow the emission of greenhouse gases to be estimated at farm level. Environmental policy Care for the environment plays a significant role in CRV’s operational management. CRV aims to control its own environmental footprint in the best possible way. The first step towards this has now been taken by recording CRV’s water and power consumption. During this financial year CRV Lagoa renewed ISO 14001 certification. ISO 14001 is the standard for establishing and certifying environmental management systems. Social involvement CRV is involved in society in a broad sense, for example by supporting two orphanages in Brazil.
CRV ANNUAL REPORT 2009-2010
27
GENERAL COURSE
OF EVENTS OF CRV HOLDING The 2009-2010 financial year can be divided into a first half in which the poor milk prices of the previous financial year did not or only marginally recovered and a second half with milk prices rising to a level at which dairy farmers were able to operate at a profit. Geographically there were major differences in dairy prices; Oceania, and specifically New Zealand recorded record highs while Central Europe found it very difficult to recover, as did North America. In Western Europe there was a moderate recovery. Throughout the world beef prices remained at a good level due to the continuing low export volumes from Argentina. The development of the CRV operating result during the 2009-2010 financial year followed the same patterns as outlined above. A first half in which it was a struggle to achieve the targets and a second half that more than exceeded the expectations. The fourth quarter in particular was well above target and better than should have been expected based on the past. Sales rose by 6 percent to e 140 million (2008-2009: e 132 million) and the operating result was excellent, as a result of which it was possible to incorporate a substantially higher incentive discount into the figures. In addition to the excellent operating result, CRV also benefited from two incidental matters. After seven years of litigation the court found in favour of CRV in respect of a fine previously imposed on it by the Dutch Competition Authority (Nma). This resulted in an incidental benefit of e 1.3 million and additional interest benefits of e 0.4 million. Agreement was also reached with the Dutch Tax Authority about the 2005-2006 tax return. This resulted in a tax saving of approximately e 2.6 million. All in all, the 2009-2010 financial year has generated an excellent operating result and the two major cases have been brought to a fully satisfactory conclusion. During the 2009-2010 financial year, CRV followed a number of other the Dutch Cattle Improvement Organisation (NVO) members and cancelled its membership of the NVO and became a member of the newly established Genetic Evaluation Sires (GES) foundation in order to secure the interests of its members in respect of the provision of reliable breeding indexes. The withdrawal from the NVO also resulted in CRV stepping out of the sector collective labour agreement (CAO) and opting to develop a company CAO. Consultation with the relevant trade unions is now fully underway and it is expected that an entirely new company CAO will be in place at the beginning of 2011. In line with the new organisational structure, consisting of a Head Quarter and various business units, good consultation was undertaken with the Works Council to adapt the employee participation structure to the new organisational structure. During the 2009-2010 financial year, intensive negotiations were conducted with both Avero/Achmea and the Agricultural Occupational Pension Fund (BPL) in order to attempt to effect a transition for the active
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CRV ANNUAL REPORT 2009-2010
financial key figures CRV Holding (x EUR thousand)
2009-2010
2008-2009
2007-2008
2006-2007
2005-2006
net sales 140.231 132.232 135.206 operating profit 3.462 5.129 3.742 profit after tax 4.733 4.544 2.027 equity 73.138 65.802 62.278 balance sheet total 112.453 103.689 102.188 working capital 36.171 26.487 24.949 liquidity (current ratio) 2,28 1,97 1,83 solvency 65,0% 63,5% 60,9%
121.150 2.060 997 58.624 93.715
124.935 4.076 3.374 57.276 93.152
20.457 1,83 62,6%
24.002 2,05 61,5%
employees who still had part of their pension entitlements insured with Avero/Achmea. Agreement has now been reached with both parties and approval has been requested from DNB (Dutch National Bank). Sales of sexed semen are often related to the milk price and were therefore below expectations during the first half of the financial year but slowly improved in the second half of the year, particularly in South America. Sexed semen remains an important product for CRV because it allows customers and members to respond more flexibly to changing market conditions. The importance of and the use of sexed semen will increase when the cost price decreases. CRV expects a cost-price decrease to take place in the coming years due to the application of new possibilities in the production process. The table above shows the development of CRV during the last five financial years, including incentive discounts and incidental revenues and expenses. For the 2009-2010 financial year it was decided to incorporate an incentive discount of more than e 1.9 million into the figures compared to e 1.1 million in the 2008-2009 financial year. A certain amount of prudence is therefore called for when comparing the results between the two financial years. However, it can be concluded that during the last five years CRV has demonstrated a solid growth in sales (12%), its net balance sheet (21%) and its net worth (28%). The 2009-2010 financial year was an excellent year for CRV compared to previous financial years. Whilst the increase in sales in 2007-2008 was driven by record milk prices and the associated high sales of sexed semen, growth in 2009-2010 was mainly achieved by the acquisitions of CRV Meggle and BOS Trading plus the favourable developments in exchange rates. In addition to this, a large number of business units further increased their semen market share.
Core activities In the 2009-2010 financial year CRV intensified the attention given to its relationship with members. Various studies into member involvement were conducted with the aim of achieving a closer bond with members. The core values of CRV – reliable, supportive, innovative and passion – have been adopted and these dovetail closely with the core values of the members. These values guide CRV day after day in its work to benefit the sustainable operational management of its members and customers.
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key figures CRV Holding BV general employees (full-time; on average) milk-sample observers (full-time; on average) results (consolidated) net turnover (€ 1 mln.) operating result (€ 1 mln.) result after taxation and minority interest (€ 1 mln.) balance sheet (consolidated) group equity (€ 1 mln.) balance sheet total (€ 1 mln.) solvency (shareholders’ equity/ balance sheet total) cash flow (€ 1 mln.)
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CRV ANNUAL REPORT 2009-2010
2009-2010
2008-2009
1,222 165
1,197 184
2009-2010
2008-2009
140.2 3.5 4.7
132.2 5.1 4.5
2009-2010
2008-2009
73.1 112.5 65.0% 3.2
65.8 103.7 63.5% 1.1
consolidated balance sheet CRV activa
31-8-2010 (x € 1.000)
31-8-2009 (x € 1.000)
fixed assets intangible fixed assets 3,655 tangible fixed assets 41,273 financial fixed assets 3,075 total fixed assets 48,003
1,461 41,506 6,949 49,916
current assets inventories 11,382 accounts receivable 27,442 cash at bank and in hand 25,626 total current assets 64,450
10,235 21,191 22,347 53,773
total
112,453
103,689
passiva
31-8-2010
31-8-2009
(x € 1.000)
(x € 1.000)
73,138 73,138
65,802 65,802
9,291 1,745 28,279 112,453
8,774 1,827 27,286 103,689
shareholders’ equity group Equity provisions long-term debt current Liabilities total
Globalisation strategy The 2009-2010 financial year was the first time that CRV worked with the new business structure and we can be proud of the result. Partly due to good planning and the unbridled effort by all involved, the transition proceeded well and an abundance of synergy has already been achieved. The inter-marketing of products between business units (exchange of local products) in particular exceeded the expectations. The optimising of production, sales and margin for CRV’s global products (European and North American Holstein product as well as MRIJ) via the allocation process is a classic example of collaboration between the Head Quarter and the business units, in which the CRV group interest is given priority over the individual interests of the business units. The next essential step in the CRV’s globalisation strategy is the implementation of an ERP system (Enterprise Resource Planning system) in order to achieve a uniform and more efficient mode of operation with greater transparency on a global scale. During the 2009-2010 financial year the necessary preparations have been made and in the 2010-2011 financial year a start will be made on implementing the system. The implementation process will take at least three years.
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31
Thanks to members, customers and staff The 2009-2010 financial year was a very successful year during which many people, from members to customers and from staff to suppliers, contributed their part. The Board is grateful to everyone and wishes to thank all of you sincerely for your contribution, support and loyalty.
Investments In line with the CRV group strategy, BOS Trading in Australia was acquired as a result of which CRV has secured a good position in the Australian market, which is set to benefit from the growing demand for dairy products, specifically in China and Indonesia. At the end of the 2009 calendar year and in line with previous agreements, CRV acquired 50% of the share capital in Sexing Technologies Brazil. This means that CRV has fulfilled its ambition to also gain a leading position in the sexed semen sector of the world’s largest growth market. CRV USA also needs a mention. Starting up ‘greenfield’ companies, when viewed from an investment perspective, is to a certain extent similar to making an acquisition. CRV USA has performed in line with expectations and is now facing the challenge of doubling its sales in the coming years. CRV will continue to invest in the major North American market. The Grassland Alliance was established in conjunction with NCBC (National Cattle Breeding Centre) from Ireland. This joint venture involves collaboration in the grassland Holstein breeding program and the marketing of semen from this program.
Expected course of events for 2010-2011 The 2010-2011 financial year will be characterised by increasing feed prices. As a result of disappointing harvests for both wheat and maize and the increasing production of crops for the production of bio-fuels, the raw material prices have risen for cattle feed. Milk prices will in all probability continue to follow the volatility of recent years. In the new financial year CRV will relentlessly continue with strategic acquisitions and enter into joint ventures in order to achieve the intended growth.
Key figures The average number of staff (expressed in FTE) employed by the CRV Holding group rose slightly from 1,197 in the 2008-2009 financial year to 1,222 in the 2009-2010 financial year. The average number of FTEs during the financial year amounted to 634 in the Netherlands, 44 in the Flanders region and 544 in the CRV International group. Net sales increased from e 132.2 million in the 2008-2009 financial year to e 140.2 million in the 20092010 financial year. This was mainly the result of the new acquisitions and the commencement of activities in America. The net turnover for the 2008-2009 financial year includes e 1.1 million incentive discount and the turnover for the 2009-2010 financial year includes e 1.9 million incentive discount. The operating result amounted to e 3.5 million. The result after tax amounted to e 4.7 million. Net worth as at 31 August 2010 was e 73.1 million, which represents an increase of e 7.3 million compared to 31 August 2009. The increase is due to the addition of the result for the 2009-2010 financial year, e 4.7 million, and positive exchange rate differences for the consolidation of group companies. The balance sheet total rose from e 103.7 million to e 112.5 million. With due regard for the e 7.8 million
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CRV ANNUAL REPORT 2009-2010
equity buffer to cover the financial consequences of a potential future FMD outbreak, solvency as at 31 August 2010 amounted to approximately 58 percent. On behalf of the Executive Board, Roald van Noort
CRV ANNUAL REPORT 2009-2010
33
consolidated profit and loss account CRV
2009-2010 (x € 1.000)
2008-2009 (x € 1.000)
net turnover genetic material 67,550 63,295 services 54,599 50,927 information products 13,210 13,432 management 4,872 4,578 net turnover 140,231 132,232 changes in inventories capitalised production other operating income
–86 745 760
401 1,104 873
total operating income
141,650
134,610
operating expenses purchases production costs staff costs traveling and car expenses accommodation expenses depreciation, amortisation and book results other operating expenses total operating expenses
7,059 28,536 70,407 9,377 3,115 8,891 10,803 138,188
6,957 28,954 66,248 9,121 3,211 2,857 12,133 129,481
3,462
5,129
851 319
362 323
total of various result components
1,170
685
result from ordinary operations before taxation
4,632
5,814
101
–1,270
4,733
4,544
operating result various result components financial income and expenses, on balance result from participating interests
taxes result after taxation
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CRV ANNUAL REPORT 2009-2010
CRV ANNUAL REPORT 2009-2010
35
CRV Holding BV P.O. Box 454 6800 AL Arnhem Phone: 0031 (0)26 38 98 800 Fax: 0031 (0)26 38 98 888 E-mail:
[email protected]
www.crv4all.com
