12 June 2015
New record high in 2014 regarding turnover and sales / The group of companies becomes a European cooperative / Export increase despite the Russian embargo
Münster. Westfleisch keeps growing. The cooperative meat distributor from Northwest Germany closed the business year 2014 reaching new record highs. The turnover rose to the new mark of 2.51 bn euros. Westfleisch‘s board spokesman Dr. Helfried Giesen presented the annual balance to the members of the general meeting on June 11 in Münster. “We consider Westfleisch to be well positioned for the following years,” Giesen underlined. Westfleisch sold 948,800 tons of goods. The export share was at 43.5 % and grew in total – despite the Russian embargo – by +1.4 %. In order to facilitate Westfleisch’s international position, the organization is converted into an European cooperative (SCE).
More turnover, more sales
The Westfleisch Group sold +4.7 % more products and was above the industry trend in 2014. The group of companies with its headquarters in Münster/North Rhine-Westphalia belongs to the three biggest meat marketers in Germany and to the top 5 in Europe. And there is a reason for it: “We stand for products with proven origin, animal welfare – and for the highest quality directly from farmers”, Giesen pointed out.
Export increase despite embargo
Export is one the supporting pillars of the Westfleisch Group. The export sales of the group rose by +45 % only during the last years from 2008 till 2014. Nearly 412,400 tons of the total of 948,000 tons of meat were sold abroad – an increase of +1.4 %. The majority (in total 82.4 % compared to 80.7 % yoy) is traditionally exported by Westfleisch to the West European neighbouring countries. From August 2014, the Russian import embargo for meat and meat produce from the EU led to a complete breakdown of the most important export business with Russia.
In 2014 and for the first time in its nearly 90 years of history Westfleisch slaughtered more than 349.800 cows (+6.0 % compared to the previous year), 62.850 calves (+5.5 %) and 7.584 m pigs (+2.4 %). Furthermore the efficiency of deboning has been increased and the production output for self-service meat products (+8.0 %), convenience (+16.0 %), sausages and cold meat (+18.8 %) have been considerably increased once more, Giesen reported.
Burger boom and organic food trend
The current trend in gastronomy towards high quality steaks and burgers is shown by steady growth in the beef product lines of the self-service subsidiary WestfalenLand in Münster. More and more fresh and deep-frozen burger patties from Westfleisch are delivered to the customers. The company is also one of the biggest German producers of organic beef for the food industry. Turnovers of WestfalenLand were at around 450 m euros in 2014 (+4.7 % compared to the previous year), sales rose by +7.9 % to around 85.000 tons. The sales of barbecue articles considerably increased by +14.0 %.
No better place for fresh sausages
Gustoland in Oer-Erkenschwick belonged to the top 10 German sausage producers in 2014. There is no better place in Germany for the slaughter and processing of fresh meat under the same roof. In the business year 2014, turnovers rose by +8.3 %, the sales of currently around 30 different types of sausage grew by +17.8 % (previous year + 11.1 %) to around 36.000 tons. Apart from discounters, Gustoland is substantially growing in the European neighbouring countries.
Biggest piglet distributor
Westfleisch is the biggest piglet distributor in Germany. The livestock section in Münster-Nienberge sold around 2.51 m animals in the traditional business area. In 2014 this was a total increase by +7.6 % compared to the previous year. Sales of piglets were at 2.46 m units. Moreover, cattle trade could be extended. The increase in Fleckvieh cattle and Black Pied cattle was at +15.9 % compared to the previous year; 46.800 animals were sold in total.
For animal welfare and agriculture
Westfleisch’s commitment for animal welfare and agriculture, for an industry-wide minimum wage or social standards and for high quality meat is taken serious, Giesen assured in his business report towards the members in the Halle Münsterland. For five years the group had been performing pioneering work in the project of animal welfare and was considerably involved in creating this term. At the beginning of 2015, food retail, farmers and meat industry started the “Brancheninitiative Tierwohl” [industry initiative for animal welfare] to improve animal husbandry in the processing of piglets and hog feeding. “The large feedback from our processing region is a positive proof for the pleasently open-minded attitude of farmers towards the production according to standards of animal welfare”, Giesen said. The number of Westfleisch shareholders rose by 99 members in 2014. By the end of the year the cooperative had 4.218 shareholders (previous year: 4.119).
More equity for independence
Accordingly, Westfleisch’s finance director Carsten Schruck presented improved figures for the business year 2014. For the first time, annual surplus after tax in the group reached 12.6 m euros (+4.2 m euros compared to the previous year). In autumn 2014, an additional 10.4 m euros of liquidity and equity were acquired by participatory certificates, Schruck reported to the members, “to keep Westfleisch’s level of indebtedness continuously low”. The equity ratio, measured according to the balance sheet total, was able to continuously remain at 43 %, despite increased investments of around 40 m euros. Schruck: “A successful company development will only be possible with a large equity base. It forms the basis for maintaining our independence.“
Dividends for credit balances of the Westfleisch eG and stocks of the Westfleisch Finanz AG were estimated again to 4.5 % each. The special bonus considered within the balance sheet for contracting farmers was increased to 2.8 m euros (+1.1 m euros) in total. The shareholders of the Finanz AG are supposed to receive a gross dividend of 4.5 % as well. Schruck pointed out: “By doing this, we invite our shareholders and cooperative farmers to draw benefit from the considerable success of Westfleisch, by offering appropriate interests for the capital invested.”
Industry in transition
In 2014 the meat industry was exposed to a notable structural change. Westfleisch got involved by taking over the meat producer Aldenhoven in Gelsenkirchen and acquiring the beef division of the company Gausepohl in February 2015. The minority shareholding of 49 % at the FVZ Westfood GmbH in Holzwickede was sold to the majority shareholder Vion.
Extended social standards
In 2014 Westfleisch belonged to the initial signers of the “Code of Conduct of the German Meat Industry“, created by the federal association VDF in cooperation with the Federal Ministry of Labour, which regulates the treatment and temporal accomodation of employees. In 2007 already Westfleisch had voluntarily introduced a minimum wage company wide. In cooperation with the group-based employment agency Wenova, concerning contracts for services and the supply of temporary workers, Westfleisch restarts to commit itself to employ internal employees instead of external employees. At the end of 2014 Wenova employed more than 650 employees, currently 950 – with rising tendency.
SCE: New ground - well-known
With the transition into a European cooperative, a “Societas Cooperativa Europaea“ (SCE), Westfleisch enters new ground in Germany. The “registered cooperative company“ (eG) according to German cooperative law is designed to become a SCE in 2015, after previous work during the past business year. It is the company form on the European level, comparable to traditional national cooperatives. The reason for that is the increasing internationalization of the meat industry. Competition demands – especially in the cooperation with trade companies that are active all across Europe – an increasing international openness.
Westfleisch is willing to face this challenge in order to remain competitive, spokesman Giesen, who will retire by the end of the year, underlined in his last business report. From 1 September 2015 Christian Leding, who was designated by the board of directors at the end of 2014, will fill this position in Münster running the business of the cooperative together with Carsten Schruck from January 2016.
|Turnover||2,514 m €||2,508 m €||+ 0.2 %|
|Total sales||948,000 t||899,600 t||+ 4.7 %|
|thereof export||412,400 t||406,700 t||+ 1.4 %|
|Total assets||479.3 m €||442.5 m €||+ 8.3 %|
|Owner's equity||212.6 m €||188.9 m €||+ 12.5 %|
|Equity ratio||44.4 %||42.7 %||+ 1.7 %|
|Pigs2||7.58 m||7.40 m||+ 2.6 %|
|Cattle||349,900||312,900||+ 11.8 %|
|Milk Calves||62,850||59,600||+ 5.4 %|
All figures Westfleisch-Group 2 without sows