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"Vegetables for healthy living"


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"Vegetables for healthy living"

  1. 1. Financial report 2005/2006 “Vegetables for healthy living”
  2. 2. Contents C O N T E N T S Review of operations and annual financial statements 2 Management report 2 I. Results of operations 2 II. Risk management 9 III. Corporate social responsibility and sustainable development 12 IV. Capital stock 14 V. Shareholders’ agreements 18 VI. Changes in shareholdings 19 VII. Share capital and voting rights as at 30 June 2005 19 VIII. Share capital and voting rights as at 30 June 2006 19 IX. Dividends 19 X. Appointments of corporate officers 20 Report on proposed shareholder resolutions 21 Report of the Supervisory Board 23 Supervisory Board Chairman’s report on Board activities and internal control 24 Statutory Auditors’ report on the report of the Chairman of Bonduelle SCA’s Supervisory Board on internal controls for financial reporting 27 Consolidated financial statements 28 Consolidated income statement 28 Consolidated balance sheet 29 Consolidated cash flow statement 30 Difference in consolidated equity 31 Notes to the consolidated financial statements 32 Auditors’ report on the consolidated financial statements 71 Parent company financial statements 72 Income statement 72 Balance sheet 73 Cash flow statement 74 Notes to the parent company financial statements 75 Subsidiaries and participating interest 82 Five-year financial summary 83 Combined Meeting of 7 December 2006 84 General Report of Statutory Auditors 91 Special Report of the Statutory Auditors on regulated agreements 92 Other statutory information 93 General information on the company 93 Change in share capital 98 Statutory Auditors’ fees 99 BONDUELLE - 2005/2006 Financial report 1
  3. 3. Review of operations and annual financial statements Management report Year in review I - Results of operations The consolidated financial statements of Bonduelle Group 1. Revenue for the fiscal year ended 30 June 2006 are presented for Group revenue declined marginally 0.2% at constant the first time in accordance with IFRS (International Financial structure and exchange rates (0.4% at current structure and Reporting Standards) as adopted by the European Union. exchange rates). For the purpose of comparison, they include information for the fiscal year ended 30 June 2005 restated according The 2.2% decline in sales in Western Europe reflected to the same standards, with the exception of IAS 32-39 significant pressure on prices to boost consumer spending applicable as of 1 July 2005. combined with our voluntary withdrawal from certain sectors not sufficiently profitable (fresh raw vegetables in In fiscal 2005/2006 stable consolidated revenue was Foodservice) or not contributing to our strategy of being accompanied by a marginal decline in the operating a pure player in the vegetable market (sale of the process- margin and an improvement in net income. ed meat activity to Rosporden). Underlying this stable performance for total revenue, trends Outside of Euroland, sales performances were marked by by region were contrasted in an environment marked by positive growth of 13% despite an unfavourable EUR/USD deflationary pressure in the consumer segment in Euroland currency effect. and strong growth in other markets. Canned vegetables sales gained 1.2% and accounted Operating profit declined marginally reflecting the net for 48% of group revenue. Sales of this division were impact of one-off restructuring and reorganization expenses particularly strong outside of Euroland. of €2.8 million in connection with ongoing efforts to opti- mize industrial operations of the last two years and reor- Frozen vegetables declined 3.4% (23% of group sales). ganization measures announced last year by the group The performance of this division was affected by sharp price under the evocative name of “David and Goliath”. declines in Western Europe in the retail market whereas robust growth of 3% was registered in France in the food To this purpose, the Wanzleben plant in East Germany was service network. closed and its activity transferred to the Straelen and Reutlingen sites. Fresh ready prepared vegetables and Delicatessen sales advanced marginally 0.3% over fiscal 2004/2005 In France, the production activity of the Flaucourt plant was (representing 29% of group sales). This sector was adversely transferred in large part to Estrées and Gniewkowo (Poland). affected by the discontinuation of the distribution of raw In addition, ambitious reorganization measures decided vegetables that had become insufficiently profitable in the and announced in the previous period were launched. As out-of-home meal segment in Germany and France. a result, since January 2006, the new subsidiary organiza- Excluding this voluntary discontinuation, processed Chilled tion has been operational and the reorganization of admi- Vegetables would have advanced 3.8%. nistrative services by geographical sector began in France with the closing of the headquarters of the previous BPL Légumes subsidiary and transfer of several accounting and sales back office services to Villeneuve-d’Ascq. 2 BONDUELLE - 2005/2006 Financial report
  4. 4. 2. Current operating income 4. Continued growth in capital expenditures R E V I E W O F O P E R AT I O N S A N D A N N U A L F I N A N C I A L S TAT E M E N T S In the year under review, current operating income increased Capital expenditures for both tangible and intangible 2.3% over fiscal 2004/2005 to €70.5 million (representing assets excluding acquisitions totalled €66.5 million versus a current operating margin of 5.9%). €56.5 million in fiscal 2004/2005. This improvement was achieved despite challenging and This high level reflects Bonduelle’s strategic focus on quality, contrasted economic trends: productivity, security and the environment, and internal growth in markets offering significant potential for expansion. - deflationary pressure in the consumer food market in the euro region; The major ERP redeployment program for €25 million laun- ched in 2000 and to be completed in 2007 also accounted - sustained growth in other European markets, particularly for a significant percentage of capital expenditures in in Central and Eastern Europe; 2005/2006. - adverse currency effects on sales caused by the weakness Research and development investments accounted for 1% of the US dollar vis-à-vis currencies of Central Europe of revenue and have contributed notably to such innovative (Hungarian forint and Polish zloty) where our production products as the 2005 launch of “Tetra RecartTM” shelf-stable sales are in large part denominated in US dollars. retail vegetable products and flexible packaging for the food catering industry. These investments also contributed The discontinuation of operations generating losses in the to the development of new products and processes such Chilled segment and the very successful production season as the “Sélection et Saveurs” line of Frozen vegetables, of the previous summer for Canned and Frozen vegetables “Pleine Saveur” and “Agita e Gusta” in the fresh-ready partially offset increases in packaging and energy costs. prepared range, in addition to fresh soups or vegetable cakes in the Delicatessen line. 3. Net income This budget highlights Bonduelle’s commitment to the group’s commitment to remaining the leading innovator in Consolidated income before minority interests advanced the field of vegetables and associated services and long- 8.9% to €40.4 million versus €37.1 million in fiscal term objective of becoming a pure player in this sector. 2004/2005. In addition to investments to maintain and enhance current Net income increased increased by 3.1% to €39.2 million operating performances, Bonduelle resumed its expansion compared with €38.0 million in 2004/2005. through acquisitions, acquiring a 13% share of Aliments Net financial expense declined to €9.6 million versus Carrière, the Canadian leader in canned and frozen vege- €10.0 million in 2004/2005 representing an improvement tables with forecasted sales of €230 million for fiscal of 4%. 2006/2007. This explains in large part long-term investments of €14 million for fiscal 2005/2006 as compared with fiscal Excluding the impact of IAS 32-39, net financial expense 2004/2005 in which no acquisitions were made. totalled - €20.3 million for fiscal 2005/2006 compared with - €10.3 million in the previous year. This change reflects notably the impact of higher rates and average debt for 5. Stable working capital requirements 2005/2006 and non-recurring income of €2.3 million that The increase in working capital of €5 million reflected: reduced financial expense in fiscal 2004/2005 (capital gains - Good management of inventories that declined 6% to from the disposal of marketable securities and the reversal €280 million or 23% of revenue versus €296 million (25% of provisions) versus non-recurring expenses in fiscal of revenue in 2004/2005). Bonduelle has continued to 2005/2006 of €3.0 million. focus on optimizing inventory management while remaining attentive to the seasonal nature of the production activity for The group tax charge declined significantly from €22.2 million canned and frozen vegetables that requires certain level in fiscal 2004/2005 to €17.8 million in the year under review. in inventories of finished products to be maintained. This decline reflects a change in the breakdown of subsi- - The neutralization of the increase in trade receivables diaries contributing to earnings and the one time “exit-tax” of €10 million, in large part reflecting high level of sales in on long-term capital gains incurred in the prior year. the last two months of fiscal 2005/2006 by the increase in trade payables of €15 million resulting from an improved This performance was achieved without applying the tax management in the settlement terms granted to our losses of the Chilled vegetable activity in Germany. suppliers. - A €13 million increase in the net balance of other receiv- ables and payables. BONDUELLE - 2005/2006 Financial report 3
  5. 5. 6. A reduction in gearing Financial debt totalled €336.1 million. Excluding cash and cash equivalents and short-term investments of €54.8 million, financial debt totalled €281.3 million corresponding to gearing of 84% versus 90% at 30 June 2005 restated according to IAS 32-39. A. Net financial debt As at 30/06 (in millions of euros) 2004* 2005* 2005 2006 Net financial debt 218.3 261.5 274.6 281.3 Shareholders’ equity 285.4 310.4 303.5 333.1 Gearing 0.76 0.84 0.90 0.84 * Excluding IFRS and IAS 32-39. B. Breakdown of net financial debt (after interest-rate and currency swaps) As at 30/06 2004 2005 2006 Fixed rate 0% 2.5% 5.7% Floating rate 100% 97.5% 94.3% Euro 90% 88% 93% US dollar 7% 10% (4%) Other currencies 3% 2% 11% 7. Adoption of IFRS The impact of the restatement of financial statements at 30 June 2005 according to IFRS breaks down as follows: (in thousands of euros) 30/06/05 Income before minority interests under French GAAP 32,360 Net income 33,122 Minority interests (762) Restatement of deferred charges 245 Restatement of fixed assets (2,095) Restatement of employee benefits 99 Changeover to full consolidation of Sud-Ouest Légumes and Bonmaïs (314) Restatement of treasury shares 23 Restatement of translation adjustments (655) Elimination of amortisation of goodwill arising from business combinations 6,210 Elimination of amortisation of other goodwill 425 Expenses associated with stock purchase options (144) Other 100 Impact of deferred taxes on IFRS restatements 812 Income before minority interests under IFRS 37,066 Net income 38,046 Minority interests (980) 4 BONDUELLE - 2005/2006 Financial report
  6. 6. 8. Business highlights In addition, the company has pursued capital expenditures R E V I E W O F O P E R AT I O N S A N D A N N U A L F I N A N C I A L S TAT E M E N T S in European countries outside of Euroland to support expan- A. Hungary sion with sales in this region up 13%. Highlighting its commitment to the environment, Bonduelle’s Fiscal 2005/2006 was also marked by the successful policy of sustainable development has introduced a focus development of the Tetra Recart TM line. Marketed in on natural resources. To this purpose, group employees seek Belgium, the Netherlands, Luxembourg, Germany, Portugal, to reduce water and energy consumption used in the trans- France and Italy, this technological innovation of Bonduelle formation process. This year significant reductions were continues to be rolled out. The new production line of achieved notably in the Nagykörös plant where energy the Renescure industrial site (France) will contribute to this consumption ratios were cut by 50%. successful deployment. In Portugal, innovations resulting B. Spain from this new technology were awarded by being selected as the product of the year 2006. Last June, Bonduelle announced a purchase of the frozen vegetable operations of Unilever in Spain already subcon- F. Awards tracted to Bonduelle since 2001. This acquisition will contri- Under the prestigious patronage of Christian Poncelet, bute an additional €10 million in revenue, strengthening its Chairman of the French Senate, the Family Business of leadership in Spain in process vegetables. the Year Award (“Grand Prix de l’Entreprise Patrimoniale”) C. Canada was awarded to Bonduelle. Remitted by Laurence Parisot, the President of the Medef, the French business trade Supplementing the external growth in Spain, the group association, this prize was conceived in 2001 by ASMEP created a joint venture with Aliments Carrière, the Canadian (“Association des Moyennes Entreprises Patrimoniales leader in canned and frozen vegetables. Through this françaises ” - French Association of Medium-Sized partnership, the North American company that shares our Entrepreneurial Businesses). This award seeks to promote group’s corporate values seeks to benefit from Bonduelle’s and recognize the corporate image, value and importance knowledge in high value added products whose offering in of French family businesses. Europe is much more developed and thus gain access to new vectors of growth. In the Boursoscan survey of 96 websites of publicly traded companies, the Bonduelle corporate site (www.bon- D. Poland was awarded third place in the small and mid- caps category. Qualities contributing to this recognition To boost sales of its new “Bonduelki” products, the group included the site’s Web surfing ease and the quality and developed an Internet site in Poland specifically dedicated timely nature of the information provided. to children. This initiative offers both a communications plat- form to both launch products and promote Bonduelle’s Following the Journées Pratiques de Nutrition, the image in this strong growth market. Louis Bonduelle Foundation was awarded the Nutridor prize, for its excellent communications on nutrition. This prize E. Group developments recognizes the numerous successes of campaigns by the Foundation to promote better nutritional practices. Reorganization measures announced last year by the group were launched. Under the evocative name of “David and Goliath”, Bonduelle’s goal is to optimize operating perfor- 9. Subsequent events mances to support its expansion in growth markets. The In June 2006, the Bonduelle Group acquired a minority stake group’s agri-food industrial operations closed two plants in in Aliments Carrière Group, the Canadian leader in canned Germany and France and a new Cassegrain production line and frozen vegetables with a market share of more than 70%. unit at the Estrées industrial site (France) was inaugurated by more than 800 employees and their families on 22 July The privately held company Aliments Carrière, with a hun- of this year. In addition, after a strategic review on group dred employees headquartered in Saint-Denis-sur-Richelieu, trends, administrative centres were created by geographical Québec, operates seven vegetable processing plants (four markets. The new organization of subsidiaries, effective in Québec and three in Ontario). starting January, has been progressively implemented. The major share of its sales (60%) is through retail outlets in All these measures were made possible by the complete the mass market segment. revamping of the IT system, henceforth fully integrated, launched in 2000 and to be finished in 2007. BONDUELLE - 2005/2006 Financial report 5
  7. 7. In accordance with the terms of the agreement concluded In July 2006, through its subsidiary Bonduelle Surgelé in June, starting 1 July 2006 the group has since acquired International the group acquired the frozen products activi- additional shares, increasing its shareholding in October ties (excluding ice cream) of Unilever in Spain. 2006 to 25%. This transaction that took effect on 1 July 2006 concerned Sales in 2006/07 (cut off at 30 April) are expected to primarily the Salto brand that will contribute additional sales approach €230 million with canned vegetables accounting to Bonduelle of €10 million. for 40% (Canada) and frozen vegetables 60% (Canada and the United States). 10. Annual trading activity and closing price Share price (in euros) 2002/2003 2003/2004 2004/2005 2005/2006 High 77.00 80.00 78.05 68.30 Low 51.60 67.80 58.40 55.15 Closing price 69.50 78.00 58.40 67.50 Market capitalization at 30 June (in millions of euros) 556 624 467 540 Average monthly trading volume 158,340 201,005 236,080 239,424 11. Outlook €230 million with US market accounting for 30%. Aliments In July 2006, the Bonduelle Group acquired the frozen food Carrière operates 7 plants (4 in Québec and 3 in Ontario). operations (excluding ice cream) of Unilever in Spain, It represents an accretive acquisition for the group and an and primarily the commercial goodwill of the Salto brand excellent opportunity for expansion in a North American subcontracted since 2001 to Bonduelle (Benimodo plant) market where demand for prepared vegetable-based meals representing a profitable source of additional annual is strong. revenue of €10 million. This operation concerns notably These acquisitions combined with improved economic rice and vegetable-based stir-fried dishes, a segment in trends in the euro zone in recent months, our continued which Salto is the leader with a market share of nearly 50%. expansion and our strong commercial positions in Central In addition, in June 2005, the group acquired a minority and Eastern Europe led the groundwork for a positive shareholding until 2007, in Aliments Carrière, the Canadian outlook for 2006/2007 and the years ahead for revenue frozen and canned vegetable leader, with revenue of and earnings growth. 12. Remuneration of officers For fiscal 2005/2006, compensation or attendance fees allocated to officers, by the company and controlled companies were as follows: (in euros) Bonduelle SCA Bonduelle SA Total Bruno Bonduelle 4,166.66 4,166.66 Damien Bonduelle 1,200 1,200 Félix Bonduelle 4,166.66 4,166.66 Jean-Marie Bonduelle 4,166.66 4,166.66 Daniel Bracquart 5,350 5,350 Olivier Cavrois 1,350 1,350 André Crespel 5,350 5,350 Stanislas Dalle 1,200 1,200 Francis Danjou 1,350 1,350 Thomas Derville 6,000 6,000 Jean Guéguen 5,350 5,350 Gilles Lessard 6,000 6,000 Yves Tack 5,350 5,350 Pierre et Benoît Bonduelle SAS 990,348 990,348 6 BONDUELLE - 2005/2006 Financial report
  8. 8. Attendance fees allocated to members of the Supervisory The company controlling Bonduelle SCA and companies the R E V I E W O F O P E R AT I O N S A N D A N N U A L F I N A N C I A L S TAT E M E N T S Board and the Accounts Committee are set by the General latter controls paid no compensation to officers and have Meeting. made no commitments involving the suspension or changes to these functions. 13. Parent company financial statements of Bonduelle SCA A. Income statement The holding company Bonduelle SCA registered net income of €57.1 million. This performance breaks down as follows: 1. Net financial income of €49.8 million from: - Dividends from Bonduelle SA +49.4 - Interest income from the loan to Bonduelle SA +0.5 - Other interests and similar income +0.2 - Financial charges and allowances for amortisations and reserves -0.3 2. Operating expenses of €1.4 million. B. Balance sheet The main balance sheet items include: 1. Fixed assets consisting primarily of capital assets of €209.5 million. 2. Shareholders’ equity of €241.4 million. (in euros) 2002/2003 2003/2004 2004/2005 Dividend payments 1.25 1.25 1.12 Tax credits on dividends 0.62 - - Gross dividend 1.87 1.25 1.12 Income qualifying for a tax allowance 1.25 1.12 Total payout (in thousands of euros) 10,000 10,000 8,960 C. Share capital Group employees own 2.5% of the share capital through a mutual fund. As at 30 June 2006, the company share capital consisted of 8,000,000 shares with a par value of €7 per share and Under the authorization granted by the Extraordinary total voting rights of 12,209,864. General Meeting of 9 June 2005, Management granted 45,000 stock purchase options at €62.52 to 46 employees Concerning holders of at least 5% of the share capital, to in the period. the best of the company’s knowledge, the French joint stock company (SA) Baie d’Audierne with 22.4% of the capital and 29.3% of the voting rights. BONDUELLE - 2005/2006 Financial report 7
  9. 9. Marketable securities As at 30/06/05 As at 30/06/06 Other treasury shares (1) 82 Treasury shares held in connection with stock option plans 5,017 6,358 Impairment of treasury shares held in connection with stock option plans (257) 4,842 6,358 Valuation at closing Treasury shares held in connection with stock option plans 7,096 9,052 (number of shares) As at 30/06/05 Increase Decrease As at 30/06/06 Treasury shares held in the value of stock option plans 121,500 45,000 32,401 134,099 Treasury shares held in connection with a liquidity agreement 17,669 261,022 252,799 25,892 (1) Treasury shares not held in connection with stock option plans recorded under marketable securities at 30 June 2005 were reclassified under financial assets at 30 June 2006. Five-year financial summary (in thousands of euros) 30/06/02 30/06/03 30/06/04 30/06/05 30/06/06 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 Results of operations for the year Revenue from subsidiaries 11,390 5,025 23,718 29,481 49,365 Revenue ex-VAT Income pre-tax, employee profit-sharing, depreciation and provisions 11,805 5,186 25,726 30,826 48,252 Income tax (307) (109) 452 (667) (8,605) Employee profit-sharing Income after taxes, employee profit-sharing, depreciation and provisions 19,828 4,773 26,156 35,323 57,189 Distributed profit 8,960 10,047 10,000 8,960 Earnings per share (in euros) Earnings after taxes, employee profit-sharing, but before depreciation and provisions 1.51 0.66 3.16 3.94 7.11 Earnings after taxes, employee profit-sharing, depreciation and provisions 2.48 0.60 3.27 4.42 7.15 Dividend per share 1.12 1.25 1.25 1.12 1.25 (1) (1) Proposed dividend submitted to the shareholders’ meeting. 8 BONDUELLE - 2005/2006 Financial report
  10. 10. II - Risk management While the proportion of assets, liabilities, sales, and R E V I E W O F O P E R AT I O N S A N D A N N U A L F I N A N C I A L S TAT E M E N T S earnings expressed in other currencies (primarily the Polish In line with the objectives defined by the group’s share- zloty, the Hungarian forint and the US dollar) has been regu- holders of long-term growth, independence and the larly evolving, their weight in the consolidated balance personal development of employees, Bonduelle adopts a sheet is not yet significant. The group is affected by the prudent and responsible approach in risk management. fluctuation of these currencies in relation to the euro on translation in the consolidated financial statements. However, this currency effect, for example when the rise of 1. Financial risk the euro reduces the contribution to earnings of consoli- The group has put into place an organization to manage dated subsidiaries that prepare their financial statements all financial, cash flow, exchange rate and counterparty risks in these currencies, remains limited. centrally. The finance department has assigned this Sales and expenses of subsidiaries are generally expressed responsibility to the cash management department and in their local currency with the exception of imports, exports provided it with all tools and expertise to operate in diffe- and financial transactions benefiting from foreign-exchange rent financial markets with optimal efficiency and security. hedging: as a result, Bonduelle considers that its local expo- The organization and procedures applied are reviewed by sure to foreign currency fluctuations has been and will the internal audit department on a regular basis. During remain limited. the financial business reviews, the group management approves the orientations adopted within the framework However, the group’s strategy of international growth may of risk management it has previously authorized. be expected to increase the impact of international ope- rations on sales, operating profit and consolidated net In a rapidly changing global environment, characterized income. by volatile markets and changing financial techniques, the group cash management department is responsible • Foreign exchange risk management strategy for: The objective is to cover on the basis of an annual budget - ensuring optimal and sufficient funding for the develop- sales-related risks of subsidiaries in a currency other than ment of all the group’s operating activities and growth, their operating currency and risks affecting the net assets - identifying, evaluating and covering all financial risks in of certain subsidiaries in countries whose operating close collaboration with line management. currency is not the euro. The objective is to minimize the impact of fluctuations in The group uses financial instruments available in over-the- financial markets on the income statement at the lowest counter markets solely for the purpose of hedging financial possible cost in order to reduce capital resources allocated risks associated with its industrial and commercial activi- to managing financial risks. ties. Hedging transactions are undertaken on the basis of objectives and procedures defined by Bonduelle Group The group prohibits acquiring speculative positions. Management and are centralized at the level of group cash management. A. Liquidity risk The group’s policy with regard to exchange rate fluctua- The objective of the group’s finance department is to tions consists in periodically calculating its net foreign- maintain sufficient liquidity at all times by the effective exchange exposure and using derivatives to reduce this management of group cash resources to ensure secure exposure. financing in respect to their duration and legal conditions. To guarantee optimal flexibility of group financing, it The group uses primarily forward exchange contracts, also implements confirmed credit lines (see note 22 to forward exchange swaps and options concluded with the consolidated financial statements of 30 June 2006). reliable counterparties. The face values of financial instru- ments held as at 30 June 2006 are presented in note 20 to B. Market risks the consolidated financial statements of 30 June 2006. a. Exchange rate risks b. Interest-rate risks • Analysis of exchange rate risk The interest rate management policy is coordinated and The group publishes its consolidated financial statements managed centrally to protect future cash flows and reduce in euros. In fiscal 2005/2006, 87% of revenue and 58% of interest expense volatility. The group uses various financial operating income was in euros. instruments available on the market and notably interest BONDUELLE - 2005/2006 Financial report 9
  11. 11. rate options and swaps. Detailed information on the port- those of Bonduelle, Cassegrain and Frudesa, register and folio of financial instruments is presented in note 20 of the renew trademarks registrations and take action against third consolidated financial statements of 30 June 2006. parties in the event of trademark infringements. C. Other legal risks 2. Equity risks Bonduelle’s sales and industrial activities are not subject to Every year, the company buys and sells its own shares, in com- significant dependencies on customers or suppliers, and it pliance with the provisions of the prospectus issued in connec- possesses assets necessary to assure its independence. tion with the share buyback program as voted by shareholders. The objectives of this program in ascending order of 4. Industrial and environmental risks priority are to: Bonduelle’s activities are subject to numerous regulations - ensure an orderly market in the company shares, concerning water, the air, soil and environmental waste. - grant stock purchase options to employees, The goal of the group’s risk management policy is to: - acquire shares for subsequent use in exchange or payment - guarantee the quality and safety of its food products by for acquisitions, effectively managing agricultural and industrial processes, - assure the availability of securities conferring rights to the - reduce the adverse consequences of its activities on the allotment of company shares, environment and people as much as possible. - proceed with the possible cancellation of shares acquired. A. Agriculture Within this framework, as at 30 June 2006, the company Agriculture provides the major share of raw materials required held 159,991 treasury shares of which 134,099 shares were to produce the group’s products. To guarantee the quality destined for stock options exercisable in part starting in of its products and protect the environment, Bonduelle has 2006. Voting rights attached to these shares are suspended adopted a supply charter that establishes criteria for selec- and they are recorded as marketable securities. ting agricultural land and crop management that farmers working with the group must apply. The company moreover does not carry equity risks in that it does not carry out any cash transactions involving invest- Based on the most demanding European standards and ments in mutual funds invested in equities or other financial notably on those originating from French integrated instruments with an equity component. farming practices (“agriculture raisonnée”), 100% of the Polish, Portuguese, Italian, and French farmers accounting for three quarters of our supplies have signed this charter. 3. Legal risks The remaining 25% supplies are subject to special contract A. Compliance specifications. In the conduct of its business and relations with its partners, B. Product quality and security Bonduelle complies with all applicable laws and regulations. Food safety is a key priority of Bonduelle’s quality policy. As a food industry company, Bonduelle is subject to national To this purpose, it has deployed HACCP procedures and international regulations concerning hygiene, quality (Hazard Analysis and Critical Control Point) to control iden- control, food products and packaging. tified risks at various stages of preparation of its products. Legal risks exist in connection with the manufacture and These procedures implemented throughout the group distribution of food products. assure the traceability of its products from the planting phase to our customers’ initial points of delivery. Risk ana- Bonduelle considers that the measures implemented to lysis procedures and controls at critical points are carried meet regulatory requirements and prevent and manage out in all production sites. these risks are sufficient. Out of the group’s 25 industrial sites, 16 have been B. Trademarks and intellectual property ISO 9001 certified and 14 BRC and/or IFS certified. Rigorous measures are deployed to protect Bonduelle In 2005/2006, many controls were carried out at the sites trademarks. Internal legal teams assisted by industrial on the basis of different systems by both internal and property consultants monitor group brands, and notably external auditors. 10 BONDUELLE - 2005/2006 Financial report
  12. 12. C. Natural resources recruiting and training our workforce take into account R E V I E W O F O P E R AT I O N S A N D A N N U A L F I N A N C I A L S TAT E M E N T S this objective of safeguarding our industrial, financial and Ongoing efforts are devoted to the optimisation of human resources. natural resources and environmental protection focusing on the following areas: The aim of this approach is to limit industrial risks or other - effective water and energy consumption, risks such as those mentioned above to which the group is naturally exposed. - improvement of water treatment equipment, - the pursuit of the industrial waste and vegetable matter To this purpose, the group insurance strategy’s approach management policy. is twofold: To guarantee perfect restitution of water to the natural • Risk assessment environment, Bonduelle has 21 treatment plants: The insurance department, part of the group finance department, is responsible for identifying and assessing all - 7 biological waste treatment plants; risks, working closely with operating entities. - 2 land application systems; The scope and amounts of insurance coverage are set at - 12 pre-treatment systems before discharge into external the group level according to objectives defined by systems. Bonduelle Group Management. Actions conducted at the different industrial sites have reduced The insurance programs are negotiated by the group consumption of energy generating pollution (low sulphur fuel) insurance department and placed with major financially in favour of cleaner energies (electricity, natural gas). sound insurance companies. • Risk transfer 5. Management of non-financial risks For major risks of potentially significant strategic and financial Three strategic objectives have been set by the shareholder impact, according to the possibilities of the insurance whose stability contributes to a long-term approach: and reinsurance markets, global programs have been imple- sustainability and continuity, independence and the mented. These concern primarily “property and business personal development of employees. interruption”, “civil liability”, “contamination and brand protection” coverage. The objective in managing non-financial risks is to protect the group’s strategic assets. Capital spending in favour Other insurance programs covering less significant risks of industrial assets, the development of our processes, also exist. BONDUELLE - 2005/2006 Financial report 11
  13. 13. III - Corporate social responsibility and sustainable development Areas Indicators Scope Agricultural production Group excluding Russia and Wanzleben Biodiversity Nearly 500 varieties of vegetables distributed through different product lines. 99 collections of varieties made it possible to observe 555 varieties in 2005/2006 Agricultural services 76 field managers Supply charter 100% farmers have signed it Soil analysis 82% of nitrogen fertilization has been calculated on the basis of the residual method Agricultural intensity 16.4 hectares of vegetables per producer Natural resources Group excluding Russia and Wanzleben Water consumption 12,973,486 m3 or 18.72 m3 per tonne of processed products Energy consumption Electricity: 283 GWh Natural gas: 448 GWh Fuel (low sulphur content) : 9 tonnes Propane : 660 tonnes Fuel oil: 437 tonnes Ordinary waste output 26,874 tonnes or 38.78 kg per tonne of processed products Recovery: Landfill sites: 34.8% Energy recovery: 6.6% Recycling: 58.6% Special waste output 151 tonnes or 0.22 kg per tonne of processed products Vegetable matter output 223,628 tonnes or 323 kg per tonne of processed products Recovery: Land applications: 4% Animal feed: 52% Subcontracting: 38% Other: 6% Biosolids 53,932 m3 or 4,693 tonnes of dry matter Packaging 96,982 tonnes Breakdown by type of material: Glass jars: 9% Metal cans: 57% Plastic films: 7% Boxes: 24% Plastic trays: 2.5% Lids: 0.5% Budgeted environmental Water: €2,407,557 impact expenditures Waste, vegetable compounds and biosolids: €343,189 Air/Energy: €2,769,442 12 BONDUELLE - 2005/2006 Financial report
  14. 14. R E V I E W O F O P E R AT I O N S A N D A N N U A L F I N A N C I A L S TAT E M E N T S Areas Indicators Scope Quality/Nutrition Group excluding Russia and Wanzleben Workforce devoted to quality control 383 employees (full-time equivalent) of whom: 7% in quality assurance departments of subsidiaries and in the group purchasing department 31% in the quality assurance departments of production sites 42% devoted to quality controls on production lines 20% for acceptance verifications Certified sites 16 ISO 9001 certified 14 BRC and/or IFS certified 6 produce certified “organic” products Consumer services 1 customer service department set up in each country People and safety Group Workforce 5,686 permanent employees 7,047 permanent, fixed-term and seasonal contracts as full-time equivalents Seniority: 0 to 3 years: 815 3 to 9 years: 1,791 + 9 years: 3,080 Turnover: Managers: 7.31% Clerical staff: 11.84% Workers: 10.03% Recruitment by contract category: Permanent: 269 Fixed-term: 768 Seasonal workers: 5,312 Formation 1.78% of total payroll Safety conditions Accident frequency rate: 30.39 Accident seriousness rate: 0.93 Departures and transfers Departures: 667 persons Resignations: 151 persons Dismissals: 320 persons Transfers to other establishments: 97 persons Industrial restructuring Workforce concerned by industrial restructuring measures who benefited from redeployment aid: 234 Organization of working time and overtime Hours worked: 12,217,989 Absenteeism rate: 6% Remuneration and advancement Total remuneration (permanent + fixed term + seasonal): €169,369,303 (excluding charges) BONDUELLE - 2005/2006 Financial report 13
  15. 15. IV – Capital stock 4. If the Management Board decides to use this authorization in connection with the issues described above in 1. a.: The procedures according to which the articles of association a. decides that the issue or issues shall be reserved in provide for modifications of the capital and voting rights comply with applicable legal provisions. priority to shareholders who may subscribe for shares on the basis of exact rights (à titre irréductible), The articles of association contain no override clauses thereto. b. decides that if subscription for new shares on the basis of exact rights, and as the case may be, for excess shares (à titre irréductible), should fail to account for Subscribed capital the entire issue, the Management Board may have The capital stock is €56 million divided into 8 million fully recourse to the options provided by law involving paid-up shares with a par value of €7 per share all of the notably offering to the public all of part of the shares same class. issued but not subscribed, c. concerning the capitalization of additional paid-in capital, Authorized but non-issued share capital reserves, profit or other items, resolves that when applicable, rights corresponding to fractional amounts The Combined General Meeting of 9 June 2005 grants the will not be negotiable and the corresponding shares Management Board the following authorizations: will be sold with any amounts resulting from the sale • The General Meeting, after reviewing the Management allocated to holders of these rights within the period Board report and the special report of the Statutory provided for by law. Auditors in accordance with the provisions of the French 5. Decides that the Management Board shall be vested Commercial Code and notably article L. 225-129-2: with, within the limits fixed above, all powers necessary 1. Authorizes the Management Board to increase the capital, to determine the conditions of the issue or issues, record in one or more tranches, in amounts and at such times the resulting increase in capital, amend the articles of it chooses: association in consequence, charge at its sole initiative, a. through the issue, in euros, foreign currencies or units the expenses of capital increases to the corresponding composed of a basket of currencies, of ordinary shares premiums and deduct from such premiums amounts and/or securities conferring present or future rights, necessary to increase the legal reserve up to one tenth at any time or on a fixed date, to ordinary shares of the new amount of authorized capital after each increase, the company or, in accordance with article L. 228-93 and in general undertake everything that is required. of the French Commercial Code, any company in 6. Duly notes that this authorization cancels and replaces which it directly or indirectly owns more than half of the the previous authorization with the same purpose. capital, whether by subscription for shares, conversion, exchange, reimbursement, presentation of a warrant or • The General Meeting, after reviewing the report of the any other means; Management Board and the special report of the b. and/or by the capitalization of paid-in capital, reserves Statutory Auditors and in compliance with the provisions or profit or other means in the form of bonus issues of the French Commercial Code and notably article or increasing the nominal value of existing shares; L. 225-129-2: 2. Grants this authorization for twenty-six months as from 1. Authorizes the Management Board to increase the the date of this Meeting. capital, in one or more tranches, in amounts and at such times it chooses, on the French market and/or on 3. Decides to set, as follows, the total aggregate amount international financial markets through public offerings of shares that may be issued under this authorization by issuing in euros, foreign currencies or units composed granted to the general partners by Management Board: of a basket of currencies, ordinary shares and/or The aggregate value of shares that may be issued under securities conferring present or future rights, at any time this authorization may not exceed €17.5 million. or on a fixed date, to ordinary shares of the company This limit includes the nominal value of additional whether by subscription for shares, conversion, shares that may be issued, in compliance with the exchange, reimbursement, presentation of a warrant or law, to safeguard the interests of holders of securities any other means; it being specified that the securities conferring rights to the capital. may be issued in payment for shares contributed to Furthermore, the aggregate nominal amount of shares the company in connection with public exchange offers issued, directly or not by virtue of the following resolu- for shares in accordance with the provisions of article tion shall be subject to this limit. L. 225-148 of the French Commercial Code. 14 BONDUELLE - 2005/2006 Financial report
  16. 16. In compliance with article L. 228-93 of the French • For each of the issues decided under resolutions 7 and 8, Commercial Code, the securities to be issued may confer R E V I E W O F O P E R AT I O N S A N D A N N U A L F I N A N C I A L S TAT E M E N T S the number of shares to be issued may be increased in rights to ordinary shares of any company in which accordance with the conditions provided for by article it directly or indirectly owns more than half of the L. 225-135-1 of the French Commercial Code and within capital. the limits authorized by the General Meeting, when the Management Board determines that there is excess 2. Grants this authorization for twenty-six months as from the date of this Meeting. demand. 3. Decides to fix, as follows, the limits of issues authorized • The General Meeting, after reviewing the report of by virtue of this authorization granted to the the Management Board and in compliance with article Management Board: L. 225-147 of the French Commercial Code: The total aggregate amount of ordinary shares that may 1. Authorizes the Management Board, pursuant to the be issued by virtue of this authorization may not exceed report of the expert appraiser (commissaire aux apports), €17.5 million. to increase the capital in payment for the contribution in kind to the company consisting of equity shares or Furthermore, shares that may be issued by virtue of securities conferring rights in the share capital when the the preceding resolution shall also be subject to this provisions of article L. 225-148 of the French commercial maximum amount. code are not applicable. 4. Decides to cancel the pre-emptive subscription right 2. Grants this authorization for twenty-six months as from of existing shareholders to the shares covered by this the date of this Meeting. resolution, while granting the Management Board the authority to confer on shareholders, preferential rights 3. Decides that the total aggregate amount of ordinary as provided by law. shares that may be issued under this authorization shall not exceed 10% of the share capital. 5. Decides that the amount reverting or which shall revert to the company for each of the ordinary shares issued This limit shall be independent of the limits imposed by by virtue of this authorization, after taking into account, the other resolutions of the General Meeting. in the case of the issue of straight stock warrants, of the 4. Decides that the Management Board shall be vested price of said warrants, will at least equal the minimum with, within the limits fixed above, all powers neces- price provided for by applicable laws and regulations at sary to determine the conditions of the issue or issues, the time the Management Board implemented this record the resulting increase in capital, amend the authorization. articles of association in consequence, charge at its sole initiative the expenses of capital increases to 6. Decides, if shares are issued in payment for shares contributed in connection with a public exchange offer, the corresponding premiums and deduct from such that the Management Board shall, within the limits fixed premiums amounts necessary to increase the legal above, be vested in all powers necessary to determine reserve up to one tenth the new amount of authorized the list of shares contributed within the framework of the capital after each increase, and in general undertake exchange offer, set the conditions of the issue, as well everything that is required. as, when necessary, the amount of cash to be paid for • The General Meeting, after reviewing the report of the the difference, and determine the terms and conditions Management Board and the special report of the Statutory of the issue. Auditors, in accordance with the provisions of articles 7. Decides that the Management Board shall be vested L. 225-129-6 and L. 225-138-1 of the French Commercial with, within the limits fixed above, all powers necessary Code and L. 443-5 of the French labour code: to determine the conditions of the issue or issues, record 1. Authorizes the Management Board, if it considers the resulting increases in capital, amend the articles of appropriate, at its sole initiative, to increase the share association in consequence, charge when necessary, the capital in one or more tranches by issuing ordinary expenses of capital increases to the corresponding shares for cash and, when applicable, through bonus premium and deduct from such premium amounts issues of ordinary shares or other securities conferring necessary to increase the legal reserve up to one tenth rights to the share capital reserved to employees the new amount of authorized capital after each increase, (and managers) of the company (and affiliates compa- and in general undertake everything that is required. nies as defined by article L. 225-180 of the French 8. Duly notes that this authorization cancels and replaces Commercial Code) participating in an employee stock the previous authorization with the same purpose. ownership plan. BONDUELLE - 2005/2006 Financial report 15
  17. 17. 2. Cancels in favour of these persons the pre-emptive right by the Management Board and may not be less than 95% to subscribe for shares that may be issued by virtue of the average opening price of the 20 trading sessions this authorization. preceding the date the option is granted. 3. Grants this authorization for twenty-six months as from • Fixes an option period of five years from the date of their the date of this Meeting. allotment including a vesting period of forty-eight months from the same date during which the options may not be 4. Limits the aggregate amount of capital increases under this authorization to 3% of the share capital on the date the exercised, Management Board decide to proceed with this capital • Grants all powers to the Management Board, within the increase. limits defined above, to fix the other conditions and proce- 5. Decides that the price of shares to be issued, by virtue dures concerning the options and their exercise, notably to: of 1. of this authorization, may not be less than 20% (or - determine the conditions according to which the options 30% when the vesting period provided for by the plan may be granted, which may include resale restrictions in accordance with article L. 443-6 is greater than or equal for all or part of the shares that may not exceed three to ten years) of the average opening price of the share years from the option exercise date, of the 20 trading days preceding the decision of the Management Board concerning the capital increase and - determine the list or categories of beneficiaries of the corresponding issue nor greater than this average. options as provided for above and the quantity of shares to which they will confer rights, 6. Grants all powers to the Management Board to implement this authorization, to perform all measures and neces- - determine the exercise period or periods for the options sary formalities. granted, - provide for the possibility of temporarily suspending Stock options to subscribe for or purchase shares the exercise period for a maximum of three months in the event of financial transactions involving the exercise The Combined General Meeting of 9 June 2005 grants the of rights attached to the shares, Management Board the following authorization: - determine the conditions according to which the price The General Meeting, after reviewing the report of the and number of the shares may be adjusted in accor- Management Board and the special report of the Statutory dance with the different assumptions provided for under Auditors: 174-8 to 174-16 of decree 67-236 of 23 March 1967. • Authorizes the Management Board within the frame- work of articles L. 225-177 to L. 225-185 of the French Commercial Code, to grant in one or more tranches in Bonus shares favour of the beneficiaries indicated below, stock purchase The Combined General Meeting of 9 June 2005 granted options to acquire shares of the company repurchased the Management Board the following authorization: through share buyback programs as provided by law. The Extraordinary General Meeting, after reviewing the • Grants this authorization for thirty-eight months as from report of the Management Board and the special report of the date of this General Meeting. the Statutory Auditors, authorizes the Management Board, • Decides that the beneficiaries of these options may to carry out, in one or more tranches, in accordance with include employees (or selected employees) or certain articles L. 225-197-1 and L. 225-197-2 of the French categories of personnel, and corporate officers as Commercial Code, bonus issues of existing ordinary shares defined by law, both of the company or joint ventures of the company or shares to be issued in favour of: in which it has interests in accordance with article • members of personnel of the company or companies L. 225-180 of the French Commercial Code. directly or indirectly affiliated as defined by article • Decides that the total number of options outstanding L. 225-197-2 of the French Commercial Code or certain granted by the Management Board under this authori- categories of this personnel, zation, and not yet exercised, may not confer rights • and/or corporate officers meeting the conditions defined to acquire shares corresponding to more than 3% of by article L. 225-197-1 of the French Commercial Code. the share capital. The total number of bonus shares may not exceed 3% of • Decides that the purchase price of the shares for bene- the share capital existing on the day the first bonus issue ficiaries shall be set on the date the options are granted is decided by the Management Board. 16 BONDUELLE - 2005/2006 Financial report
  18. 18. The allotment of shares to beneficiaries will be definitively of 10% of the share capital or 800,000 shares, to R E V I E W O F O P E R AT I O N S A N D A N N U A L F I N A N C I A L S TAT E M E N T S acquired after a minimum period of two years. Further- cancel shares of the company that it holds or may more, the beneficiaries must hold said shares for at least hold pursuant to shares repurchased within the frame- two years. work of article L. 225-209 of the French Commercial Code and reduce the share capital by the correspon- The Management Board has the option of increasing the ding amount in accordance with applicable laws and duration of these two periods. regulations, It is furthermore granted full authority to: 2. grants this authorization for twenty-four months as from • determine conditions, and when applicable, the criteria the date of the General Meeting i.e. until 9 June 2007, for allotting bonus shares, 3. grants all powers to the Management Board to take the • determine the identity of beneficiaries and the number actions necessary to cancel the shares and reduce the of shares granted to each, share capital and modify the articles of association and • determine the impact on the rights of beneficiaries of tran- carry out all necessary formalities. sactions affecting the share capital or that may affect the value of shares granted carried out during the acquisition and holding periods and in consequence, modify or Share repurchase program adjust, if necessary, the number of bonus shares issued The Combined General Meeting of 9 June 2005 granted to safeguard the rights of beneficiaries, the Management Board the following authorization: • and when applicable: The General Meeting, after reviewing the report of the - determine the existence of sufficient reserves and for Management Board and the memorandum approved by each bonus issue transfer from a special restricted the French financial market authority (AMF), authorizes the reserve amounts necessary for the payment of the new Management Board for eighteen months in compliance shares to be allotted, with articles L. 225-209 et seq. of the French Commercial - decide, in time, to increase the capital through the capi- Code, to repurchase, through one or more transactions at talization of reserves, additional paid-in capital or pro- times of its choosing, shares of the company no to exceed fit corresponding to the issue of bonus shares, with the 10% of the current capital stock or 800,000 shares. amount of this increase or increases subject to the maxi- mum authorized amount under resolution eight, This authorization cancels the previous authorization granted to the Management Board by the Ordinary General - acquire shares within the framework of a share buyback Meeting of 1 December 2004. program to be allocated to the bonus issue, - undertake all measures to ensure that beneficiaries comply Shares may be repurchased to: with the obligation to retain their shares, - ensure the orderly trading of the Bonduelle shares by - and, in general, perform everything that this authorization an investment services provider within the framework requires within the framework of existing laws and of a liquidity agreement in compliance with the rules of regulations. conduct of the French association of investment firms (AFEI) as recognized by the AMF, This authorization constitutes the express waiver by existing shareholders to their rights to the percentage of - keep acquired shares for subsequent use in exchange or reserves, additional paid-in capital and profit to be payment for possible acquisitions, capitalized for the payment of the bonus shares. - for the purpose of stock option plans and other measures This authorization is granted for thirty-eight months as from in favour of employees and/or officers of the group the date of the General Meeting. according to the conditions and procedures provided for by law, and notably in connection with employee profit-sharing schemes, stock ownership plans and Cancellation of shares bonus issues, The Combined General Meeting of 9 June 2005 granted - for the purpose of securities conferring rights to the following authorization to the Management Board: shares of the company within the framework of existing The General Meeting, after reviewing the reports of the regulations, Managing Partner and the Statutory Auditors: - cancel shares acquired, subject to the authorization to be 1. authorizes the Management Board, at its sole choice, granted by this Meeting in resolution fifteen falling onto through one or more transactions within the limit the scope of the Extraordinary General Meetings. BONDUELLE - 2005/2006 Financial report 17
  19. 19. Shares may be repurchased by all means including through Lock-up agreements block trades at time of the Management Board’s choosing, In addition to escrow commitments, the first lock-up agree- during public offerings in accordance with security market ment was signed on 26 May 1998 by 101 family shareholders regulations. However, the company does not intend to have “with the purpose of creating a stable and long-lasting core recourse to derivatives. shareholding”. Under this agreement, the signatories The maximum purchase price must not exceed €100 undertook for ten years to hold a portion of their shares. per share. In the event of capital transactions including As of 30 June 2006, shares concerned by this agreement notably stock splits, reverse splits or bonus issues, represented 23.4% of the share capital. this amount will be adjusted in the same proportions This agreement was concluded for ten years and parties (whereby the adjustment multiplier equals the ratio undertook to jointly reassess the situation two years before between the number of shares before and after the its expiration. transaction). The second agreement was concluded between 137 family This share buyback authorization is limited to €80 million. shareholders with the purpose of stabilizing the volume of The General Meeting grants all powers to the Management shares traded on the market, ensuring continuity in the Board to carry out the transactions, determine the terms company’s management and maintaining the undertaking and conditions, conclude all necessary agreements and to cooperate in a partnership and oversee its administration perform all legal formalities. (affectio societatis) by the family shareholding group. This agreement was signed on 27 March 1998 for five years and has been renewed annually, whereby each party to the V - Shareholders’ agreements agreement may withdraw from the agreement one year before each renewal date. Escrow agreement In its meeting of 1 July 1998, the Conseil des Marchés Bonduelle is a French limited partnership with shares Financiers (CMF), considered that under the provisions of the (société en commandite par actions – SCA). agreement when considered together or separately, the signa- The general partner is a French simplified joint stock tories were acting in concert (action de concert ) and subject company “Pierre et Benoît Bonduelle SAS” whose to specific disclosure obligations under French law. As of 30 shares are directly held by 15 members of the Bonduelle June 2006, these shareholders represented 47.33% of the family. capital and 61.36% of the 12,209,256 existing voting rights. This latter company, represented by its Chairman Christophe Bonduelle, is the managing partner of Other shareholder agreements Bonduelle SCA. Bonduelle informs its shareholders that, pursuant to the In compliance with article 14.3 of the articles of asso- adoption of the economic initiative law (or “Dutreil law”) ciation of Bonduelle SCA, at least 1,520,000 stripped in 2003, Bonduelle SCA concluded a lock-up agreement share rights or 760,000 Bonduelle shares (usufruct, bare for the total amount of its shareholdings in Bonduelle SA ownership rights or both) were deposited on escrow on for six years. This agreement was renewed on December behalf of “Pierre et Benoît Bonduelle SAS” until 2004 and will be renewed again on December 2006. December 2007. Shares held in escrow represent 9.5% In compliance with the law, Bonduelle SCA shareholders may of the share capital. adhere to this agreement and benefit from its provisions. 18 BONDUELLE - 2005/2006 Financial report
  20. 20. VI - Changes in shareholdings R E V I E W O F O P E R AT I O N S A N D A N N U A L F I N A N C I A L S TAT E M E N T S (in %) 30/06/04 30/06/05 30/06/06 General partner 24.0 24.0 24.3 Other Bonduelle family shareholders 28.1 28.9 27.5 Employees 3.3 3.0 2.5 Treasury shares 1.9 1.8 2.0 Free float 42.7 42.3 43.7 TOTAL 100.0 100.0 100.0 VII - Share capital and voting rights as at 30 June 2005 Number of shares % Voting rights % Baie d’Audierne SA (1) 1,788,976 22.3 3,577,952 29.3 Pierre et Benoît Bonduelle SAS 138,646 1.7 207,813 1.7 General partner 1,927,622 24.0 3,785,765 31.0 Other Bonduelle family shareholders 2,311,348 28.9 4,580,144 37.6 Employees 234,378 3.0 435,634 3.6 Treasury shares 139,169 1.8 - - Free float 3,387,483 42.3 3,387,483 27.8 TOTAL 8,000,000 100.0 12,189,026 100.0 VIII - Share capital and voting rights as at 30 June 2006 Number of shares % Voting rights % Baie d’Audierne SA(1) 1,788,976 22.4 3,577,952 29.3 Pierre et Benoît Bonduelle SAS 155,493 1.9 273,660 2.2 General partner 1,944,469 24.3 3,851,612 31.5 Other Bonduelle family shareholders 2,199,983 27.5 4,153,685 34.0 Employees 202,693 2.5 398,551 3.3 Treasury shares 159,991 2.0 - - Free float 3,492,864 43.7 3,805,408 31.2 TOTAL 8,000,000 100.0 12,209,864 100.0 (1) SA Baie d’Audierne is 53.3% owned by the general partner, SAS Pierre et Benoît Bonduelle and its sole purpose is as a holding company for Bonduelle SCA shares. IX – Dividends Dividends per share paid for the last three fiscal years are presented below: (in euros) 2002/2003 2003/2004 2004/2005 Dividend distributed 1.25 1.25 1.12 Tax credit 0.62 - - Total income 1.87 1.25 1.12 Income qualifying for a tax allowance 1.25 1.12 Dividend payout (in thousands of euros) 10,000 10,000 8,960 BONDUELLE - 2005/2006 Financial report 19