2 - Review of operations and
annual financial statements
Report of the Management Board 2
I. Sales and earnings 2
II. Risk management 9
III. Corporate social and environmental responsibility 12
IV. Share capital 14
V. Shareholders’ agreements 18
VI. Analysis of shareholder structure at June 30 19
VII. Analysis of share capital and voting rights at June 30, 2006 19
VIII. Analysis of share capital and voting rights at June 30, 2007 19
IX. Dividends 19
X. Positions held by directors and officers 20
Report on proposed shareholder resolutions 21
Report of the Supervisory Board 22
Report of the Chairman of the Supervisory Board 23
Report of the Independent Auditors on the report of the Chairman 27
28 - Consolidated financial statements
Consolidated income statement 28
Consolidated balance sheet 29
Consolidated cash flow statement 30
Consolidated statement of changes in shareholders’ equity 31
Notes to the annual consolidated financial statements 32
Report of the Independent Auditors on the consolidated financial statements 65
66 - Individual financial statements
Income statement 66
Balance sheet 67
Cash flow statement 68
Notes to the annual financial statements 69
Information concerning subsidiaries and affiliates 76
Five-year financial summary 77
Combined Ordinary and Extraordinary Shareholders’ Meeting of December 6, 2007 78
General report of the Independent Auditors 83
Special report of the Independent Auditors on regulated agreements and commitments 84
85 - Other statutory information
General information regarding the Company 85
Analysis of changes in share capital 90
Independent Auditors’ fees 91
Bonduelle-Financial report 2006/2007 1
Review of operations and
annual financial statements
Report of the Management Board
Introduction I - Sales and earnings
The consolidated financial statements of the Bonduelle Group 1. Group sales
for the financial year ended June 30, 2007 are presented in
accordance with all International Financial Reporting Standards Consolidated sales increased by 5.1% on a constant exchange
(IFRS) adopted within the European Union. For purposes of rate basis, and by 3.6% on a like-for-like basis.
comparison, they include historical data for the financial year Each of our major geographical regions posted sales growth.
ended June 30, 2006, also prepared in accordance with IFRS,
including IAS 32/39, which took effect on July 1, 2005. European Union
After two difficult years, the group’s historical region regained
In financial year 2006-07, the group’s consolidated sales, oper- its vitality. Sales were up 4%, due in part to the September 2006
ating income and net income all rebounded to post gains. acquisition of Salto (Unilever’s frozen vegetable business) in
These performances were even more remarkable insofar as they Spain, as well as to the general, balanced sales growth observed
were achieved despite difficult weather conditions, unfavorable in all of our various technological business lines: 5% in canned,
exchange rate trends and strong cost inflation for materials and 3% in frozen, and 4% in fresh.
supplies. Meanwhile, we safeguarded the group’s medium-term The fresh vegetable business suffered the effects of unfavorable
prospects by significantly increasing spending on research and weather conditions, as the very mild winter was not propitious
development and communications. to the consumption of fresh cut vegetables, and the cold, damp
spring did not help sales of prepared salads, which kept this fresh
This good financial health enabled us to lay the foundations for vegetable segment from driving sales growth, as it usually does.
a new, vital penetration into the North American market as part Conversely, Bonduelle’s traditional canned and frozen technolo-
of the group’s globalization and risk diversification strategy. gies rebounded well, driven by sales of our most recent, promising
innovations, including the “sachet fraîcheur” freshness bag for our
The group is also pursuing the reorganization first approved foodservice customers; Tetra Recart retortable carton packaging;
and begun in 2005. The new scope of the subsidiaries has been Légumes du Soleil line of Mediterranean-style vegetables under the
operational since January 2006, which has enabled the group to Cassegrain brand; Famili Balls line of frozen “veggie-puffs”, etc.
pool all of the administrative functions within a geographical The growth rates in the last quarter allow us to be optimistic
region into a single legal structure, under the so-called “David about the outlook for the coming year.
and Goliath” three-year plan, which is part of a continuous
progress and cost reduction action plan. Rest of world
More than 20% of the group’s sales growth came from outside
the European Union, reflecting the relevance of our strategic
growth strategies, in particular those involving Eastern Europe.
This increase in sales is even more remarkable insofar as it was
achieved in spite of unfavorable exchange rates (rise of the euro
against the U.S. dollar) and increased competition in sweet
2 Bonduelle-Financial report 2006/2007
2. Operating income and operating income rate increases in the euro, U.S. dollar, Hungarian forint and
from continuing operations Canadian dollar, the currencies in which Bonduelle funds its
Operating income rose by 16.2 million euros to 84.0 million
euros, or 6.7% of total sales (5.7% in 2005-06). Excluding The interest rate hedges used to hold the cost of our financial
the impact of a non-recurring gain that primarily reflects a debt in euros to 3.65% became active during the last months of
change of inventory valuation methods, operating income from financial year 2006-07.
continuing operations for financial year 2006-07 amounted to
71.9 million euros, up 2% over 2005-06. The increase of the group’s income tax expense from 17.8 million
euros in 2005-06 to 23.9 million euros in 2006-07 reflects the
The group achieved this improved profitability despite: sizeable increase in income before tax and the change in the
G A very significant increase in marketing expenses for brand relative weights of the subsidiaries contributing to the group’s
development (10%), which brings our marketing budget in consolidated earnings (it should be noted that the tax losses of
line with our capital spending on industrial equipment, the fresh business in Germany have not been capitalized).
G Very difficult production conditions in northwestern Europe
during the summer of 2006, due to the heat wave in July,
G Considerable inflation in the prices of certain materials and 4. Capital expenditure
supplies, such as packaging and energy,
G Unfavorable changes in foreign exchange rates, due to the Total capital expenditure excluding acquisitions amounted to
strength of the euro, Hungarian forint and Polish zloty against 57.9 million euros, compared with 66.5 million euros in 2005-06.
the U.S. dollar.
These investments are used to improve equipment productivity
These results reflect the expertise and tremendous motivation of and safety, promote innovation, improve environmental protec-
all of the group’s employees, the pertinence the strategic choices tion and support growth in Eastern Europe and in fresh food
the group has made, and the actions we have taken during the technologies.
past two years to improve the effectiveness of our organizations:
G Restructuring of production facilities, In 2006-07, the program for the deployment of the ERP system
G Consolidation of back-offices by geographical region, continued to weigh heavily upon the capital expenditure
G Investments in competitive advantages and information systems. budget, as the project will not be completed until late 2007.
Our capital spending on research and development represented
3. Net income - Group share 1% of total sales, and allowed the group to maintain its
dynamic policy of promoting innovative projects –such as the
Total consolidated net income rose by 28.1% to 51.7 million sachets fraîcheur freshness bags for food service professionals and
euros, or 4.1% of total sales, compared with 40.4 million euros Tetra Recart for consumer canned goods– and perfecting and
in 2005-06. introducing new products and processes, such as the Légumes du
Soleil range under the Cassegrain brand, the Famili Balls line in
Net income - Group share increased by 32.1% to 51.8 million frozen foods, etc.
euros, compared with 39.2 million euros in 2005-06. In addi-
tion to the non-recurring 9.5 million euro net gain on the Bonduelle also made several new acquisitions totaling 10 million
change of inventory valuation methods, net income - Group euros in 2006-07, purchasing Unilever’s Salto brand of frozen
share benefited from the 3.9 million euro earnings contribution vegetables in Spain and demonstrating our ongoing interest in
from our minority interest in Aliments Carrière (accounted for the Canadian company Aliments Carrière by increasing our
under the equity method). stake in that company from 13% to 23%.
Net financial expense rose by 27.4% to 12.3 million euros,
from 9.6 million euros in 2005-06.
Excluding the impact of IAS 32/39, the group would have
reported net financial expense of 24.3 million euros for 2006-07,
compared with 20.3 million euros for 2005-06, i.e. a 4.0 million
euro increase. This increase is attributable primarily to interest
Bonduelle-Financial report 2006/2007 3
5. Cyclical increase in working capital 7. Highlights
The group’s 31 million euro increase in working capital included Products
the following: Italy – healthful products
In order to highlight the natural nutritional qualities of its
G A 39 million euro cyclical increase in inventories to 319 million vegetables, Bonduelle has developed three new products in Italy
euros at June 30, 2007, i.e. 25% of total sales, compared with in the Agita & Gusta range. These innovations offer consumers
280 million euros at June 30, 2006. a pleasurable taste experience that is good for their health at the
This change is attributable to both the change of inventory same time. The Italian company has developed a recipe rich in
valuation methods at June 30, 2007 (14 million euros) and beta-carotene for healthy skin, a fiber-rich mixture for intestinal
the early start of the pea harvest in June 2007. regularity, and a product rich in Omega 3 to improve protection
of the vascular system.
G The off-setting of the 39 million euro increase in trade accounts
receivable, due in large part to the high sales recorded during Tetra RecartTM
the last three months of financial year 2006-07, by a compa- The world leader in vegetables, Bonduelle invests heavily in
rable increase in trade accounts payable. research in order to provide consumers with products that are
always increasingly consistent with their expectations. One
symbol of this dynamic trend in innovation is the commercial
6. Debt-equity ratio continues to fall launch of the new Tetra RecartTM non-metallic containers. Each
year, the good performances posted by this new type of pack-
The group reported gross financial debt of 360.4 million euros. aging enable Bonduelle to pursue its international rollout.
Less cash and 21.3 million euros in other and financial assets,
net financial debt represented 277.9 million euros, i.e. 73% of Sachet fraîcheur [freshness bag]
total shareholders’ equity, compared with 84% at June 30, 2006. Bonduelle is multiplying its innovations in all of its distribution
channels. For example, in the past several years the Company
has developed a new type of “canned” packaging called the
A. Net financial debt sachet fraîcheur, or freshness bag, for its foodservice customers
(restaurants, school cafeterias, etc.). This innovative, ecological,
At June 30
economic and simple-to-use system has strengthened the
(in millions of euros) 2005* 2005 2006 2007
group’s leadership in the food service market.
Net financial debt 261.5 274.6 281.3 277.9
Shareholders’ equity 310.4 303.5 333.1 381.8
Net financial debt/
Dissemination of the new sourcing charter
shareholders’ equity 0.84 0.90 0.84 0.73 Bonduelle’s sourcing charter allows the Company to formalize
its relationships with the farmers that produce vegetables for the
* Excluding IFRS and IAS 32/39.
group and defines the conditions required for environmentally-
friendly farming, thereby promoting precision agriculture. On
July 10, a new, optimized charter was launched in France and
B. Analysis of net financial debt will now be disseminated throughout the rest of the world.
after interest rate and currency swaps What distinguishes the new charter from the previous versions
is that it is organized on the basis of the analysis of risks (chem-
At June 30
ical, physical, etc.).
(in %) 2005 2006 2007
Strong improvement in workplace safety
Fixed rate 2.5 5.7 5.1
As a result of the safety awareness policy set in place as part of
Variable rate 97.5 94.3 94.9
Euro 88 93 75
the group’s commitment to sustainable development, the
U.S. dollar 10 (4) 3
number of accidents in the workplace recorded this year fell by
Other currencies 2 11 22
23%. The formalization of the sustainable development action
plan in 2002, the establishment of safety-related metrics and
the exchange of best practices all contributed to this good
4 Bonduelle-Financial report 2006/2007
Review of operations and annual financial statements
Group market in North America, compared with 13.5% in Western
Outcome of the David & Goliath plan Europe*. The retail grocery sector is nevertheless very important
As part of its continuous improvement strategy, Bonduelle is for Aliments Carrière, thanks notably to sales of its popular
pursuing the measures it undertook under its David & Goliath Arctic Gardens brand, the market leader in Quebec.
plan, and is extending it to the establishment of shared services Sales of canned vegetables are distributed between Canada
centers (SSC) within the group. These entities, which simplify (86%) and the United States (14%), and most sales (71%) are
the administration of shared services for several group divisions, through the retail grocery channel.
fulfill two major objectives: compliance with the requirements
applicable to publicly held companies, and optimization of Industrial sites
costs through the centralization of expertise. This year, the The acquisition of Aliments Carrière, which since July 2007 has
group’s efforts resulted in the creation of SSCs in Germany, been incorporated into the group as the new Bonduelle North
Italy, Benelux and France (excluding the prepared foods scope). American subsidiary, diversifies the geographical distribution of the
group’s production regions, adding seven production facilities –four
Cultivation in Quebec and three in Ontario– to the 23 existing production sites
Because of its involvement in the primary transformation industry, in Western, Central and Eastern Europe. Located near the largest
Bonduelle must continuously deal with the impact of weather- Canadian cities and population centers on the East Coast of the
related risks. A very mild spring and a cool and rainy summer United States, the seven production facilities –two of which are
throughout Western Europe affected the effectiveness of seeding specialized in canned, three in frozen and two hybrids– produce
and harvesting operations. However, given the geographical distri- close to 300,000 metric tons of vegetables for a market that includes
bution of the agricultural regions supplying Bonduelle –which 190 million inhabitants, i.e. a population three times that of France.
extend from Portugal to Russia– these climatic risks were success-
fully managed, and the Company met its 2007 harvest needs. Potential growth opportunities arising
Nevertheless, unpredictable weather conditions in recent years from the acquisition
and the increase of the amount of arable land used for the The entry of Aliments Carrière entry into the group means the
production of bioethanol created strong market tensions. addition of 985 new employees from a non-European culture –
Accordingly, the prices of many agricultural products such as a first for Bonduelle. In addition to the exciting challenge faced
wheat and corn increased considerably. In response to this new by the Human Resources Department, the arrival of these
economic reality, Bonduelle is maintaining its productivity and Canadian colleagues represents a potential opportunity for
cost reduction efforts in order to lessen the impact of these exchanges of good practices on both sides of the Atlantic.
increases on its production costs. Potential synergies are being analyzed, and certain have already
been clearly identified in various areas such as production,
water and energy consumption, innovation and new products.
8. Events after the balance sheet date
The first success was the launch in Canada, of three different
Aliments Carrière: the event of the year mixes of ‘steamed’ in the microwave frozen vegetables under the
On July 12, 2007, the Bonduelle Group announced that it had Steammm! line of the Arctic Gardens brand. These products
acquired full control of Aliments Carrière, the Canadian leader were developed with the help of Bonduelle’s agro-industrial
in canned and frozen vegetables. This acquisition is a significant expertise, and are already a big hit with Canadian consumers.
step in the Company’s international expansion, providing They were elected “products of the year” in Quebec, and are
Bonduelle with a long-term North American presence. finalists for an award for innovation in Canada –encouraging
rewards that are indicative of great promise for the future.
With commercial operations in the United States and Canada
generating the equivalent of 220 million euros in sales, the Bond issue (OBSAAR)
family-owned Aliments Carrière group’s business is comprised In early July 2007, the Bonduelle Group issued a 150 million
of two of Bonduelle’s “traditional” technologies: canned (39% euro bond with share subscription and/or purchase warrants
of total sales) and frozen (61% of total sales). (OBSAAR), with a lump sum maturity at the end of six years.
The dominant frozen business is positioned mainly in Canada Bonduelle issued these OBSAAR-type bonds with a par value of
(63%), with sales through three types of distribution channels 1,000 euros to take advantage of favorable market conditions by
specifically proportioned to North America. With only 44% of optimizing the cost of its debt and thereby further strengthen
sales through the retail grocery industry, this activity reflects the its balance sheet.
importance of the B2B market and notably of the food service
industry, which accounts for nearly 31% of the total vegetable * Etude food for thought.
Bonduelle-Financial report 2006/2007 5
The funds raised will be used to meet the group’s general 9. Change of valuation method
funding needs and support its targeted acquisition strategy. This
transaction will also enable Bonduelle to strengthen its equity During the financial year, the Bonduelle Group changed the
base, in the event that some of the warrants are exercised and method used to measure its inventories. This modification
new shares are subscribed. concerned the incorporation of all fixed production costs into
inventories. At June 30, 2007, this change of method increased
both closing inventories and operating income by 14 million
10. Share price and trading information
(in euros) 2003/2004 2004/2005 2005/2006 2006/2007
Highest 80 78.05 68.30 99.55
Lowest 67.8 58.4 55.15 66.60
Financial-year-end closing price 78 58.4 67.50 91.70
Market capitalization at June 30 (in millions of euros) 624 467 540 733.6
Average monthly trading volume (in number of shares) 201,005 236,080 239,424 289,576
11. Outlook 12. Compensation of directors and officers
A climate of considerable uncertainty is being generated by the The following amounts were paid by the Company and the
increase in agricultural prices around the globe due to the companies its controls in compensation and directors’ fees to
change in the EU common agricultural policy (CAP), the sharp directors and officers in respect of financial year 2006-07:
increase in world demand for food, the explosion in the amount
of arable land used for non-food purposes (biofuels) and the (in euros) Bonduelle SCA
low level of grain inventories.
Damien Bonduelle 1,200
Daniel Bracquart 3,600
Our performances in 2007-08 and the years to come will
Olivier Cavrois 1,200
depend on our ability to pass these inflationary phenomena
André Crespel 3,600
along in our selling prices.
Stanislas Dalle 1,200
Francis Danjou 600
The consolidation of Aliments Carrière, effective July 1, 2007,
Isabelle Danjou 300
should nevertheless provide a substantial boost to the group’s
Jean Gueguen 3,600
sales and earnings, starting in the coming financial year, and
Yves Tack 3,600
promote growth in North America in the ensuing years.
Pierre and Benoît Bonduelle SAS 980,700
The directors’ fees allocated to members of the Supervisory
Board and the Audit Committee are determined by the
The company that controls Bonduelle SCA and the companies
controlled, in turn, by the latter, did not pay any other compen-
sation to the directors and officers and have not assumed any
commitments as regards any future termination or change of
these functions, or subsequent to any such events.
6 Bonduelle-Financial report 2006/2007
Review of operations and annual financial statements
13. Annual financial statements (in euros per share) 2003/2004 2004/2005 2005/2006
of Bonduelle SCA
Net dividend paid 1.25 1.12 1.25
A. Income statement Gross dividend 1.25 1.12 1.25
The Bonduelle SCA holding company reported net income of Amount qualifying for a tax allowance 1.25 1.12 1.25
30.6 million euros. Total payout (in thousands of euros) 10,000 8,960 10,000
This includes primarily:
1. Net financial income of 30.6 million euros: C. Share capital
– Dividends received from Bonduelle SA +30.1 At June 30, 2007, the share capital of the Company consisted
– Other interest and financial income +0.7 of 8,000,000 shares with a par value of 7 euros per share, repre-
– Financial expenses and provisions (0.2) senting a total of 11,982,090 voting rights.
To the best of the Company’s knowledge, the following shareholders
2. Operating expenses of 1.5 million euros. own at least 5% of the Company’s capital: Baie d’Audierne SA,
with 22.4% of the capital and 29.9% of the voting rights.
B. Balance sheet Group employees held a 2.7% share of the capital through
The main balance sheet headings are: mutual funds.
1. Non-current assets of 278 million euros, During the financial year, the Management Board, exercising
comprised essentially of financial holdings; the authorization received from the Extraordinary Shareholders’
Meeting of June 9, 2005, granted 9,226 stock options with an
2. Shareholders’ equity of 261.6 million euros. exercise price of 83.30 euros per share to 29 employees.
Non-current financial assets
Analysis of changes in gross values and provisions:
Gross values Acquisition Sales Redemptions, Gross values
at June 30, reclassifications at June 30,
(in thousands of euros) 2006 and other (1) 2007
Investments in subsidiaries 207,770 69,000 276,770
Bonduelle SA 207,770 69,000 276,770
Other non-current receivables 143 39 182
Loans to affiliates 143 39 182
Other non-current financial assets
Treasury stock held under a liquidity contract 1,581 27,236 (27,267) (466) 1,084
209,493 96,275 (27,267) (466) 278,035
Gross values Provisions Charges Recoveries Carrying
at June 30, at June 30, amounts at
(in thousands of euros) 2007 2006 June 30, 2007
Investments in subsidiaries 276,770 276,770
Other non-current receivables 182 182
Other non-current financial assets
Treasury stock held under a liquidity contract 1,084 1,084
Value at year end
Treasury stock 1,791
(1) When the exercise period expires, should any options have not been exercised, the corresponding treasury stock is reclassified under non-current financial assets.
Bonduelle-Financial report 2006/2007 7
At June 30, 2006 At June 30, 2007
Treasury stock held for stock options 6,358 6,156
Impairment of treasury stock held for stock options
Value at year-end
Treasury stock held for stock options 9,052 9,953
(in number of shares) At June 30, 2006 Increase Decrease Reclassification At June 30, 2007
Treasury stock held for
stock options 134,099 9,226 31,984 (3,400) 107,941
Treasury stock held under
a liquidity contract 25,892 317,511 318,151 (5,826) 19,426
Five-year financial summary
(in thousands of euros) 2002/2003 2003/2004 2004/2005 2005/2006 2006/2007
FINANCIAL POSITION AT YEAR-END
Share capital 56,000 56,000 56,000 56,000 56,000
Number of shares issued 8,000,000 8,000,000 8,000,000 8,000,000 8,000,000
TOTAL INCOME FROM OPERATIONS
Income from subsidiaries 5,025 23,718 29,481 49,365 30,100
Income before taxes, employee profit-sharing, depreciation,
amortization and provisions 5,186 25,726 30,826 48,252 30,041
Income tax (109) 452 (667) (8,605) (490)
French legal profit-sharing
Income after taxes, employee profit-sharing, depreciation,
amortization and provisions 4,773 26,156 35,323 57,189 30,555
Dividends paid 10,047 10,000 8,960 10,000
INCOME FROM OPERATIONS PER SHARE
Income after taxes and employee profit-sharing,
but before depreciation, amortization and provisions 0.66 3.16 3.94 7.11 3.82
Income after taxes, employee profit-sharing, depreciation,
amortization and provisions 0.60 3.27 4.42 7.15 3.82
Dividend paid per share 1.25 1.25 1.12 1.25 1.35
(1) Proposal submitted to the Shareholders’ Meeting.
8 Bonduelle-Financial report 2006/2007
Review of operations and annual financial statements
II - Risk management B. Market risks
a. Currency risk
In line with the objectives defined by the group’s senior manage- G Risks related to changes in foreign exchange rates
ment (including durability, independence and employee develop- The group publishes its consolidated financial statements in
ment), Bonduelle takes a conservative and responsible approach euros, and in 2006-07 86% of its sales and 64% of its operating
to its risks. income was denominated in euros.
The share of assets, liabilities, sales and earnings denominated
in other currencies –essentially the Polish zloty, Hungarian
1. Financial risks forint and U.S. dollar– fluctuates continuously, but still does
not have a material impact on the consolidated balance sheet.
The group has established an organization that provides for This being the case, the group is subject to the impacts of fluc-
centralized management of all of its liquidity, currency, interest tuations in the relative value of these currencies to the euro
rate and counterparty credit risks. The Finance Department has when they are translated into euros in its consolidated financial
assigned the Group Treasury Department responsibility for risk statements, but is still impacted only slightly by a translation
management, and provided it with all of the expertise and tools effect –for example, when the euro appreciates against these
needed to participate in the various financial markets as effec- currencies– that reduces the earnings contribution from those
tively and safely as possible. The organization and procedures subsidiaries whose financial statements are denominated in
utilized are regularly reviewed by the Internal Audit these currencies.
Department. At Financial Business Reviews, the group’s senior
management validates all of the guidelines set in place in rela- All sales and expenses of group subsidiaries are generally
tion to previously authorized risk management strategies. expressed in their local currency, with the exception of imports,
exports and financial transactions covered by foreign currency
In a global economic environment that is experiencing rapid hedges: Bonduelle believes that its local exposure to currency
change, characterized by market volatility and changes in finan- fluctuations was and will remain slight.
cial techniques, the role of the Group Treasury Department is to: However, the group’s international growth strategy should
increase the weight of non-French activities in sales, operating
G Guarantee optimum and sufficient funding to finance the income and consolidated net income.
expansion and growth of the group’s activities, and
G Identify, evaluate and hedge all financial risks in close collab- G Hedging policy for currency risk
oration with the operations teams. The group seeks to hedge, on a budgeted annual basis, all risks
relating to the sales of its subsidiaries denominated in a currency
The objective is to minimize, at the lowest possible cost, the other than their functional currency, and the risks regarding the
impact of financial market fluctuations on the group’s income, net assets of certain subsidiaries conducting business in coun-
in order to reduce the capital allocation required to manage tries with a functional currency other than the euro.
these financial risks as much as possible.
The group uses only over-the-counter financial instruments to
The group forbids the taking of speculative positions. hedge the financial risks generated by its production and sales
activities. All hedging transactions entered into must comply
A. Liquidity risk with the objectives and procedures established by the Bonduelle
The Group Finance Department is responsible for maintaining group’s senior management. These transactions are centralized
sufficient liquidity at all times. It accomplishes this by effi- within the Group Treasury Department.
ciently managing the group’s cash balances and ensuring that
the maturity and legal conditions of the financing obtained are The group’s policy regarding fluctuations in foreign exchange
both appropriate. It also arranges confirmed lines of credit to rates consists of periodically calculating its net exposure to foreign
maximize the flexibility of the group’s financing; details currencies and using financial derivatives to reduce this risk.
regarding these confirmed lines are provided in Note 22 of the
notes to the consolidated financial statements at June 30, 2007. The group makes use above all of forward foreign exchange
contracts, foreign currency swaps and options entered into with
AAA rated bank counterparties. An analysis of the portfolio at
June 30, 2007 is provided in Note 20 of the notes to the consol-
idated financial statements at June 30, 2007.
Bonduelle-Financial report 2006/2007 9
b. Interest rate risk 3. Legal risks
The interest rate management policy is centrally coordinated,
controlled and managed, with the goal of protecting future cash A. Compliance
flow and reducing the volatility of financial expenses. The Bonduelle complies with all applicable laws and regulations in
group uses various instruments available in the market, notably the conduct of its business and its relationships with its part-
interest rate options and swaps contracts. An analysis of the ners.
portfolio at June 30, 2007 is provided in Note 20 of the notes As a member of the food industry, Bonduelle is subject to
to the consolidated financial statements at June 30, 2007. national and international regulations concerning health,
quality control, food products and packaging.
2. Equity risks There are legal risks associated with the manufacture and distri-
bution of food products.
Every year, the Company buys and sells its own shares, in Bonduelle considers that the measures it has implemented are
compliance with the provisions of the prospectus issued in sufficient to meet regulatory requirements and prevent and
connection with the share repurchase program as voted by manage these risks.
B. Trademarks and intellectual property
In ascending order of priority, the objectives of this program are to: Rigorous measures are deployed to protect Bonduelle trade-
marks. Internal legal teams assisted by industrial property
G Ensure secondary market-making and the liquidity of consultants monitor group trademarks, especially the
Bonduelle shares by an investment services provider; Bonduelle, Cassegrain and Frudesa brands, register and renew
G Hold the shares acquired for subsequent use in exchange or as trademark registrations and take actions against third parties in
payment in connection with any potential acquisition; the event of trademark infringements.
G Ensure that sufficient shares are available to cover needs
generated by stock option plans and any other form of alloca- C. Other legal risks
tion of shares to employees and/or the directors and officers Bonduelle’s sales and industrial activities are not significantly
of the group; dependent upon other companies, customers or suppliers, and
G Ensure that sufficient shares are available to cover needs it has all of the assets required to guarantee the independence of
generated by marketable securities giving right to the alloca- its activities.
tion of shares of the Company in accordance with all regula-
tions in effect;
G Cancel any of the shares acquired, subject to the prior author- 4. Industrial and environmental risks
ization of the Shareholders’ Meeting.
Bonduelle’s activities are regulated by numerous provisions
Within this framework, at June 30, 2007, the Company held regarding water, air, soil and environmental waste.
127,367 treasury shares, of which 107,941 were destined for stock The group’s risk management policy seeks above all to:
options exercisable in part starting in 2007. Voting rights attached G Guarantee the quality and safety of its food products by effec-
to these shares are suspended, and the shares are recorded under tively managing the agricultural and industrial processes,
securities available for sale. G Reduce to the greatest extent possible the adverse conse-
The Company is not, moreover, exposed to any equity risks insofar quences of its activities on the environment and people.
as it does not engage in any cash management transactions involving
investments in equity funds or other financial instruments with an
10 Bonduelle-Financial report 2006/2007
Review of operations and annual financial statements
A. Agriculture 5. Hedging of non-financial risks
Agriculture provides the major share of raw materials required
to produce the group’s products. To guarantee the quality of its Three strategic objectives have been set for the Company by the
products and protect the environment, Bonduelle has adopted shareholder, the stability of which contributes to a long-term
a sourcing charter that establishes criteria for selecting agricul- approach: durability, independence and employee development.
tural land and crop management that farmers working with the The primary objective of the non-financial risk management
group must apply. policy is to protect the group’s strategic assets. The broad
Combining the most stringent European standards, and strategic guidelines governing capital spending on industrial
notably on those taken from French precision agriculture prac- assets, the development of our processes, and the recruitment
tices, 100% of the Polish, Portuguese, Italian, and French and training of our workforce all take account on a permanent
farmers accounting for three quarters of our supplies have basis of this objective of safeguarding our industrial, financial
signed this charter. The remaining 25% of supplies are subject and human resources.
to special contract specifications. The aim of this approach is to limit industrial or other risks
such as those mentioned above to which the group is naturally
B. Product quality and safety exposed.
Food safety is a key priority of Bonduelle’s quality policy. To
this purpose, it has established Hazard Analysis and Critical To the best of the Company’s knowledge, there are no extraor-
Control Point procedures (HACCP) to control identified risks dinary events or disputes that are likely to have a material
at various stages of the preparation of its products. These proce- impact on the group’s earnings or assets.
dures, which have been implemented throughout the group,
provide an audit trail of its products from the planting phase to To this end, the group’s insurance strategy is based on two main
our customers’ initial points of delivery. Risk analysis proce- principles.
dures and controls at critical points have been set in place
throughout the production process. Assessment of risks
Of the group’s 26 industrial sites, 17 have been ISO 9001 certi- The Insurance Department, part of the Group Finance
fied, 16 have been BRC and/or IFS certified, and 6 produce Department, is responsible for identifying and assessing all
products certified as “organic.” In 2006-07, many controls were risks, and collaborates closely with the operating entities.
carried out at the sites by both internal and external auditors on The scope and amounts of insurance coverage are set at the
the basis of the various standards. group level, based on objectives defined by Bonduelle’s senior
C. Natural resources The insurance programs are negotiated by the Group Insurance
Continuous efforts are devoted to the optimization of natural Department and placed with top tier insurance companies.
resources and environmental protection, focusing on the
following areas: Transfer of risks
G Control over water and energy consumption, Global integrated programs have been set in place for major
G Improvement of wastewater treatment equipment, risks with potentially significant strategic and financial impacts,
G Pursuit of the industrial waste and vegetable matter manage- to the extent permitted by the insurance and reinsurance
ment policy. markets. These concern primarily “damage and business inter-
Bonduelle has 21 treatment plants, to guarantee that water is ruption”, “liability”, and “contamination and brand image”
returned in pristine condition to the natural environment: coverage.
G 7 biological waste treatment plants;
G 2 agricultural fertilizer systems; Other insurance programs covering less significant risks have
G 12 systems for pre-treatment before discharge into external also been subscribed.
Actions conducted at the different industrial sites have reduced
consumption of polluting energies (low-sulphur fuel) in favor
of cleaner energies (electricity, natural gas).
Bonduelle-Financial report 2006/2007 11
III – Corporate social and environmental responsibility
Areas Metrics Scope
AGRICULTURAL PRODUCTION GROUP
Biodiversity Nearly 500 varieties of vegetables distributed through various product lines,
119 collections of varieties made it possible to observe 509 varieties in June 2007
Agronomic services 84 field managers
Sourcing charter 100% of all farmers have signed the charter
Soil analysis 72% of all nitrogenous fertilizers have been calculated using the residual method
Agricultural intensity 19.5 hectares of vegetables raised by each producer
NATURAL RESOURCES GROUP
Water consumption 13,041,067m3 consumes, or 17.35m3 per metric tonne of product produced
Energy consumption Electricity: 280GWh
Natural gas: 436GWh PCs
Fuel (very low sulphur content): 45 metric tonnes
Propane: 861 metric tonnes
Domestic fuel oil: 612 metric tonnes
Production of ordinary wastes 24,263 metric tonnes, equal to 32.28kg per metric tonne of product produced
Landfill sites: 33%
Recovery of energy: 14%
Production of special wastes 158 metric tonnes, or 0.21kg per metric tonne of product produced
Production of composite plant wastes 259,361 metric tonnes, or 345kg per metric tonne of product produced
Agricultural fertilizer: 3%
Animal feed: 75%
Biosolids 38,820m3, or 1,951 metric tonnes of dry matter
Packaging 110,705 metric tonnes
Analysis by type of material:
Glass jars: 8.5%
Metal cans: 56%
Plastic films: 9%
Cardboard boxes: 22%
Plastic trays: 3%
Expenses incurred to prevent Water and sludge from wastewater processing plants: 1,436,077 euros
environmental impacts of group activities Industrial and composite plant wastes: 338,837 euros
Air and energy: 2,809,685 euros
12 Bonduelle-Financial report 2006/2007
Review of operations and annual financial statements
Areas Metrics Scope
Total quality control staff 408 employees (in full-time equivalents), of which:
7.5% in the Quality Departments of the subsidiaries and the Group Purchasing Department
30.5% in the Quality Departments of the production sites
42% in the quality control function on the production lines
20% in final receiving controls
Certified sites 17 are ISO 9001 certified
16 are BRC and/or IFS certified
6 produce products that are certified “organic”
Customer service 1 customer service department has been established in each country other than Russia
EMPLOYEE/SAFETY DATA GROUP
Employees 5,598 permanent employees
7,166 full-time equivalents under long-term, short-term and seasonal employment contracts
0 to 3 years: 753
3 to 9 years: 1,747
> 9 years: 3,098
Administrative employees and technical supervisors: 12.85%
New hires by type of employment contract:
Training 2.39% of total payroll
Safety conditions Accident frequency rate: 23.04
Coefficient of seriousness of accidents: 0.72
Departures and transfers Departures: 566 persons
Resignations: 217 persons
Dismissals: 193 persons
Transfers to other establishments: 25 persons
Work week and overtime Hours worked: 11,850,526
Absenteeism rate: 5.11%
Compensation and career advancement Total compensation
(l/t, s/t and seasonal contracts): 172,180,083 euros (excluding payroll taxes)
Bonduelle-Financial report 2006/2007 13
IV – Share capital This limit includes the total par value of additional shares that
may be issued, in compliance with the law, to safeguard the
The conditions under which the Articles of Incorporation provide interests of holders of securities conferring rights to the capital.
for the modification of the share capital and voting rights comply
with all applicable legal provisions. Furthermore, the aggregate par value of shares issued, directly
or not by virtue of the following resolution shall be subject to
The Articles of Incorporation do not provide for any special this limit.
4. If the Management Board decides to use this authorization in
connection with the issues described above in 1.a-:
a- decides that the issue or issues shall be reserved in priority
The share capital amounts to 56,000,000 euros, consisting of to shareholders who may subscribe for shares on the basis of
8,000,000 fully paid-up shares of a single class of stock, with a their exact, proportional preemptive rights;
par value of 7 euros per share.
b- decides that in the event that existing shareholders do not
subscribe to a sufficient number of new shares –by exercising
Authorized share capital not issued their exact, proportional preemptive rights and, if appropriate,
subscribing to additional shares on the basis of their preemp-
The Combined Ordinary and Extraordinary Shareholders’ tive rights– to account for the entire issue, the Management
Meeting of December 7, 2006 granted the following delega- Board may have recourse to the options provided by law
tions to the Management Board: involving notably the offering to the public of part of the
shares issued but not subscribed;
G The Shareholders’ Meeting, after reviewing the report of the
Management Board and the special report of the Independent c- concerning the capitalization of additional paid-in capital,
Auditors and in accordance with dispositions of the French reserves, net income or other items, resolves that when appli-
Commercial Code and notably Article L. 225-129-2 thereof: cable, rights corresponding to fractional amounts will not be
negotiable, and the corresponding shares will be sold with any
1. Authorizes the Management Board to increase the capital, in amounts resulting from the sale allocated to holders of these
one or more transactions, in amounts and at such times it rights within the period provided for by law.
a- through the issue, in euros, foreign currencies or units 5. Decides that the Management Board shall be vested, within
composed of a basket of currencies, of ordinary shares and/or the limits established above, with all powers necessary to deter-
securities conferring present or future rights, at any time or on mine the conditions of the issue or issues, record the resulting
a fixed date, to ordinary shares of the company or, in accor- increase in capital, amend the Articles of Incorporation in
dance with Article L. 228-93 of the French Commercial consequence, charge on its own initiative the expenses of capital
Code, any company in which it directly or indirectly owns increases to the corresponding premiums and deduct from such
more than half of the capital, whether by subscription for premiums amounts necessary to increase the legal reserve to one
shares, conversion, exchange, reimbursement, presentation of tenth the new amount of authorized capital after each increase,
a warrant or any other means; and in general undertake everything that is required.
b- and/or by the capitalization of paid-in capital, reserves or
net income or other means in the form of bonus issues or 6. Duly notes that this authorization cancels and replaces the
increasing the nominal value of existing shares; previous authorization with the same purpose.
2. Grants this authorization for twenty-six months as from the G The Shareholders’ Meeting, after reviewing the report to the
date of this Meeting. Management Board and the special report of the Independent
Auditors, and in accordance with dispositions of the French
3. Decides to set, as follows, the total aggregate amount of Commercial Code and notably Article L. 225-129-2 thereof:
shares that may be issued under this authorization granted to
the general partners by Management Board: 1. Authorizes the Management Board to increase the capital, in
one or more transactions, in amounts and at such times it chooses,
The aggregate par value of shares that may be issued under this on the French market and/or on international financial markets
authorization may not exceed 17,500,000 euros. through public offerings by issuing in euros, foreign currencies
14 Bonduelle-Financial report 2006/2007
Review of operations and annual financial statements
or units composed of a basket of currencies, ordinary shares in capital, amend the Articles of Incorporation in consequence,
and/or securities conferring present or future rights, at any time charge when necessary, the expenses of capital increases to the
or on a fixed date, to ordinary shares of the company whether by corresponding premium and deduct from such premium
subscription for shares, conversion, exchange, reimbursement, amounts necessary to increase the legal reserve to one tenth the
presentation of a warrant or any other means; it being specified new amount of authorized capital after each increase, and in
that the securities may be issued in payment for shares general undertake everything that is required.
contributed to the Company in connection with public exchange
offers for shares in accordance with the provisions of Article 8. Duly notes that this authorization cancels and replaces the
L. 225-148 of the French Commercial Code. previous authorization with the same purpose.
In accordance with Article L. 228-93 of the French Commercial G For each of the issues decided under Resolutions 16 and 17, the
Code, the securities to be issued may confer rights to ordinary number of shares to be issued may be increased in accordance
shares of any company in which it directly or indirectly owns with the conditions provided for by Article L. 225-135-1 of
more than half of the capital. the French Commercial Code and within the limits author-
ized by the General Meeting, when the Management Board
2. Grants this authorization for twenty-six months as from the determines that there is excess demand.
date of this Meeting.
G The Shareholders’ Meeting, after reviewing the report of the
3. Decides to set, as follows, the limits of issues authorized by Management Board and in accordance with Article L. 225-147
virtue of this authorization granted to the Management Board: of the French Commercial Code:
The total aggregate par value of ordinary shares that may be 1. Authorizes the Management Board, pursuant to the report of
issued by virtue of this authorization may not exceed the expert appraiser, to increase the capital in payment for the
17,500,000 euros. contribution in kind to the Company consisting of equity
shares or securities conferring rights in the share capital when
Furthermore, shares that may be issued by virtue of the preceding the provisions of Article L. 225-148 of the French Commercial
resolution shall also be subject to this maximum amount. Code are not applicable.
4. Decides to cancel the preemptive subscription right of existing 2. Grants this authorization for twenty-six months as from the
shareholders to the shares covered by this resolution, while date of this Meeting.
granting the Management Board the authority to confer on
shareholders, preferential rights as provided by law. 3. Decides that the total par value of ordinary shares that may
be issued under this authorization shall not exceed 10% of the
5. Decides that the amount reverting or that shall revert to the share capital.
Company for each of the ordinary shares issued by virtue of this
authorization, after taking into account, in the case of the issue This limit shall be independent of the limits imposed by the
of straight stock warrants, of the price of said warrants, will at other resolutions of the Shareholders’ Meeting.
least equal the minimum price provided for by applicable laws
and regulations at the time the Management Board implemented 4. Decides that the Management Board shall be vested with,
this authorization. within the limits fixed above, all powers necessary to determine
the conditions of the issue or issues, record the resulting
6. Decides, if shares are issued in payment for shares contributed increase in capital, amend the Articles of Incorporation in
in connection with a public exchange offer, that the Management consequence, charge at its sole initiative the expenses of capital
Board shall, within the limits fixed above, be vested with all increases to the corresponding premiums and deduct from such
powers necessary to determine the list of shares contributed premiums amounts necessary to increase the legal reserve to
within the framework of the exchange offer, set the conditions one-tenth the new amount of authorized capital after each
of the issue, as well as, when necessary, the amount of cash to increase, and in general undertake everything that is required.
be paid for the difference, and determine the terms and condi-
tions of the issue. G The Shareholders’ Meeting, after reviewing the report of
the Management Board and the special report of the Inde-
7. Decides that the Management Board shall be vested, within pendent Auditors, in accordance with the provisions of
the limits fixed above, with all powers necessary to determine Articles L. 225-129-6 and L. 225-138-1 of the French
the conditions of the issue or issues, record the resulting increases Commercial Code and L. 443-5 of the French Labor Code:
Bonduelle-Financial report 2006/2007 15
1. Authorizes the Management Board, if it considers appropriate, G Decides that the beneficiaries of these warrants may include
at its sole initiative, to increase the share capital in one or more employees (or selected employees) or certain categories of
transactions by issuing ordinary shares for cash and, when appli- personnel, and directors and officers as defined by law, both
cable, through bonus issues of ordinary shares or other securities of the Company or economic interest groupings in which it
conferring rights to the share capital reserved to employees partic- participates, as provided for by Article L. 225-180 of the French
ipating in an employee stock ownership plan. Commercial Code;
2. Cancels in favor of these persons the preemptive right to G Decides that the total number of warrants outstanding
subscribe for shares that may be issued by virtue of this author- granted by the Management Board under this authorization,
ization. and not yet exercised, may not confer rights to acquire shares
corresponding to more than 3% of the share capital;
3. Grants this authorization for twenty-six months as from the
date of this Meeting authorization. G Decides that the purchase price of the shares for beneficiaries
shall be set on the date the warrants are granted by the
4. Limits the aggregate amount of capital increases under this Management Board and may not be less than 95% the
authorization to 3% of the share capital on the date the Manage- average opening price of the 20 trading sessions preceding the
ment Board decides to proceed with this capital increase. date the warrant is granted;
5. Decides that the price of shares to be issued, by virtue of 1. G Establishes a warrant period of five years from the date of their
of this authorization, may not be less than 20% (or 30% when allocation, including a vesting period of forty-eight months from
the vesting period provided for by the plan in accordance with the same date during which the warrants may not be exercised;
Article L. 443-6 is greater than or equal to ten years) of the
average opening price of the share of the 20 trading days G Grants full powers to the Management Board, within the limits
preceding the decision of the Management Board concerning defined above, to set the other conditions and procedures
the capital increase and the corresponding issue nor greater than concerning the options and their exercise, notably to:
this average. – Determine the conditions under which the warrants may be
granted, which may include resale restrictions for all or part
6. Grants full powers to the Management Board to implement of the shares that may not exceed three years from the
this authorization, to perform all measures and necessary warrant exercise date,
formalities. – Determine the list or categories of beneficiaries of options
as provided for above and the quantity of shares to which
Share subscription and/or purchase warrants they will confer rights,
The Combined Ordinary and Extraordinary Shareholders’ Meeting – Determine the exercise period or periods for the warrants
of June 9, 2005 granted the following delegation to the Manage- granted,
ment Board: – Provide for the possibility of temporarily suspending the
exercise period for a maximum of three months in the event
The Shareholders’ Meeting, after reviewing the report of the of financial transactions involving the exercise of rights
Management Board and the special report of the Independent attached to the shares,
Auditors: – Determine the conditions under which the price and
number of the shares may be adjusted, in accordance with
G Authorizes the Management Board, in accordance with the the various assumptions provided for in Articles 174-8 to
provisions of Articles L.225-177 to L. 225-185 of the French 174-16 of Decree 67-236 of March 23, 1967.
Commercial Code, to grant in one or more transactions in
favor of the beneficiaries indicated below, warrants to Bonus share issues
purchase existing shares of the Company repurchased through The Combined Ordinary and Extraordinary Shareholders’
share buyback programs as provided for by law; Meeting of June 9, 2005 granted the following delegation to the
G Grants this authorization for thirty-eight months as from the
date of this Shareholders’ Meeting; The Extraordinary Shareholders’ Meeting, after reviewing the
report of the Management Board and the special report of the
Independent Auditors, authorizes the Management Board to
16 Bonduelle-Financial report 2006/2007
Review of operations and annual financial statements
carry out, in one or more transactions, in accordance with – Undertake all measures to ensure that beneficiaries comply
Articles L. 225-197-1 and L. 225-197-2 of the French with the obligation to retain their shares; and, generally,
Commercial Code, bonus issues of existing ordinary shares of – Perform all acts required by this authorization under all existing
the Company or shares to be issued in favor of: laws and regulations.
G Members of personnel of the Company or companies directly This authorization constitutes the express waiver by existing
or indirectly affiliated as defined by Article L. 225-197-2 of shareholders to their rights to the percentage of reserves, addi-
the French Commercial Code, or certain categories of this tional paid-in capital and net income to be capitalized for the
personnel; payment of the bonus shares.
G And/or of the directors and officers, within the meaning of This authorization is granted for thirty-eight months as from
Article L. 225-197-1 of the French Commercial Code. the date of this Meeting.
The total number of bonus shares may not exceed 3% of the Cancellation of shares
share capital existing on the day the first bonus issue is decided The Combined Ordinary and Extraordinary Shareholders’
by the Management Board. Meeting of December 7, 2006 granted the following delegation
to the Management Board:
The allocation of shares to beneficiaries will become fully vested
after a minimum period of two years. Furthermore, the benefi- The Shareholders’ Meeting, after reviewing the report of the
ciaries must hold said shares for at least two years. Management Board and the report of the Independent Auditors:
The Management Board has the option of increasing the dura- 1. Authorizes the Management Board, at its sole discretion,
tion of these two periods. through one or more transactions within the limit of 10% of
the share capital or 800,000 shares, to cancel shares of the
It is furthermore granted full authority to: Company that it holds or may hold pursuant to shares repur-
chased in accordance with Article L. 225-209 of the French
G Establish the conditions and, when applicable, the criteria for Commercial Code and reduce the share capital by the corre-
allocating bonus shares; sponding amount in accordance with the provisions of all appli-
cable laws and regulations,
G Determine the identity of the beneficiaries and the number of
shares allocated to each of them; 2. Grants this authorization for twenty-four months as from the
date of this Meeting, i.e. until December 7, 2008,
G Determine the impact on the rights of beneficiaries of trans-
actions affecting the share capital or that may affect the value 3. Grants full powers to the Management Board to take the
of shares granted carried out during the acquisition and actions necessary to cancel the shares and reduce the share
holding periods and in consequence, modify or adjust, if capital and modify the Articles of Incorporation and carry out
necessary, the number of bonus shares issued to safeguard the all necessary formalities.
rights of beneficiaries;
Share repurchase program
G And, when applicable: The Combined Ordinary and Extraordinary Shareholders’
– Determine the existence of sufficient reserves and for each Meeting of December 7, 2006 granted the following delegation
bonus issue transfer from a special restricted reserve amounts to the Management Board:
necessary for the payment of the new shares to be allotted,
– Decide, in time, to increase the capital through the capital- The Shareholders’ Meeting, after reviewing the report of the
ization of reserves, additional paid-in capital or net income Management Board, authorizes the latter, for eighteen months,
corresponding to the issue of bonus shares, with the amount in accordance with Articles L. 225-209 et seq. of the French
of this increase or increases subject to the maximum author- Commercial Code, to repurchase, through one or more trans-
ized amount under Resolution 8, actions at times of its choosing, shares of the Company not to
– Acquire shares under a share buyback program to be allo- exceed 10% of the current capital stock, or 800,000 shares.
cated to the bonus issue,
This authorization cancels the previous authorization granted
to the Management Board by the Ordinary Shareholders’
Meeting of June 9, 2005.
Bonduelle-Financial report 2006/2007 17
Shares may be repurchased to: V - Shareholders’ agreements
G Ensure the secondary market-making and liquidity of Escrow agreement
Bonduelle shares by an investment services provider through
a liquidity agreement in compliance with the rules of conduct Bonduelle is a French limited partnership with shares (société en
of the French Association of Investment Firms (AFEI) as commandite par actions, or SCA).
recognized by the French Financial Markets Authority The General Partner is “Pierre et Benoît Bonduelle SAS,” a
(AMF); French simplified joint stock company whose shares are held
directly by 15 members of the Bonduelle family.
G Hold the shares acquired, to subsequently use them in Pierre et Benoît Bonduelle SAS is represented as General
exchange or as payment in connection with any acquisition Partner by its Chairman, Christophe Bonduelle.
that may take place, as long as the shares acquired in this In accordance with Article 14.3 of the Articles of Incorporation
manner do not exceed 5% of the Company’s share capital; of Bonduelle SCA, at least 1,520,000 stripped share rights or
760,000 Bonduelle shares (with beneficial ownership or full
G Ensure that sufficient shares are available to cover needs ownership rights, or both) were deposited in escrow on behalf
generated by stock option plans and any other form of alloca- of Pierre et Benoît Bonduelle SAS until December 2007. These
tion of shares to employees and/or the directors and officers shares held in escrow represent 9.5% of the share capital.
of the group, under the conditions and in accordance with the
methods provided for by law, notably with regard to the Lock-up agreement
French legal profit-sharing requirement, employee savings
plans or bonus shares; In addition to escrow commitments, the first lock-up agreement
was signed on May 26, 1998 by 101 family shareholders “with the
G Ensure that sufficient shares are available to cover needs gener- purpose of creating a stable and long-lasting core shareholding.”
ated by marketable securities giving right to the allocation of Under this agreement, the signatories undertook to hold a portion
shares of the Company in accordance with all regulations in of their shares for ten years. At June 30, 2007, the shares concerned
effect; by this agreement represented 25.51% of the Company’s capital.
This agreement was concluded for ten years and parties undertook
G Cancel any of the shares acquired, subject to the authorization to jointly reassess the situation two years prior to its expiration.
to be granted by this Meeting in Resolution 15 falling within The second agreement was concluded between 137 family
the purview of the Extraordinary Shareholder Meeting. shareholders with the purpose of stabilizing the volume of shares
traded on the market, ensuring continuity in the company’s
Shares may be repurchased by all means including through management and maintaining the undertaking to cooperate in
block trades at time of the Management Board’s choosing, a partnership and oversee its administration (affectio societatis)
during public offerings in accordance with security market by the family shareholding group.
regulations. However, the Company does not intend to use This agreement was signed on March 27, 1998 for five years and
derivatives. has been renewed annually; each party to the agreement may
withdraw from the agreement one year prior to each renewal date.
The maximum purchase price must not exceed 110 euros per In its meeting of July 1, 1998, the French Financial Markets
share. In the event of capital transactions including notably Council (Conseil des Marchés Financiers, or CMF), considered that
stock splits, reverse splits or bonus issues, this amount will be under the provisions of the agreement when considered together
adjusted in the same proportions (whereby the adjustment or separately, the signatories were acting in concert and subject to
multiplier equals the ratio between the number of shares before specific disclosure obligations under French law. At June 30, 2007,
and after the transaction). these Bonduelle shareholders represented 48.61% of the capital
and 67.24% of the 11,982,090 existing voting rights.
This share buyback authorization is limited to 88,000,000 euros.
The Shareholders’ Meeting grants full powers to the Manage-
ment Board to carry out the transactions, determine the terms Bonduelle informs its shareholders that, pursuant to the adoption of
and conditions, conclude all necessary agreements and perform the economic initiative law (the so-called Dutreil Act) in 2003,
all legal formalities. Bonduelle SCA concluded a lock-up agreement for the total
amount of its shareholdings in Bonduelle SA for six years. This
agreement was renewed in December 2004, and again in December
2006. As provided for by law, Bonduelle SCA shareholders may
adhere to this agreement and benefit from its provisions.
18 Bonduelle-Financial report 2006/2007