Technology to feed a growing world 2014 ANNUAL REPORT
Pavan Group - Annual Report 2014
Introduction
This document describes the process of economic, social and environmental reporting that Pavan has adopted in recent years. Its publication stems from management’s desire to make the company’s activity transparent, by analysing not only the economic aspects, but also the social and environmental consequences.
All this is part of a corporate philosophy oriented towards sustainability and the integrated type of management system adopted: quality, safety, environment and social responsibility. This eighth edition contains data and information relating to the entire Pavan Group* updated to December 2014. *Pavan s.r.l., Golfetto Sangati s.r.l., V.AL.IN. s.r.l., Pizeta s.r.l., Tecnel s.r.l.
Pavan Group - Annual Report 2014
INDEX
CEO’s message
5
Corporate social responsibility
20
Corporate profile
6
Study, sport, culture
22
Financial results
8
Sustainability
24
Key figures
10
Food Tech Master
28
Added value
12
Directors and auditors
30
Installations
14
Organisation chart
16
Human resources
18
Pavan Group - Annual Report 2014
“
Our growth drives us to improve products and processes
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4
Pavan Group - Annual Report 2014
Stronger while facing the challenges of the future Year 2014 marked a new record for the Group in number of sales and completed installations. The 158 million euros in sales corresponded to a dozen completed mills, an impressive port facility for the unloading of cereals and over 60 production lines between dry and fresh pasta and extruded products. This is a confirmation of our leadership both in the more mature sectors as well as in the production processing of innovative foods. This remarkable result proves the growth in some of the markets in which Pavan Group has believed in for many years. On one hand, developing Countries have entrusted us with the expansion of their food industry seeking innovative and cutting edge technologies, capable of optimizing production costs while increasing sales and the quality of the finished product. For example in India we installed the largest twin-screw extruder ever built! This confirms that advanced technology is not an exclusive entitlement of mature markets. When the industry is reassured with concrete indisputable results, the mere pursuit of cost gives way to a more rational and fruitful long term investment. Within the established markets, research for innovative products and process optimization will continue. Pavan Group has joined the largest food multinationals with proposals and solutions to intelligently expand
their offer while anticipating consumer trends that, in a few months, have been confirmed to be accurate and prolific. All this has been possible due to a rational and consistent work effort with various guidelines: research and development, focused on the use of newer raw materials, experimentation aimed at optimizing the consolidated processes using a cutting-edge technological innovation with a more efficient and accurate design. Innovative software tools and streamlined internal procedures have played a key role. We have reached a more punctual delivery of orders with added incisiveness due to the reorganization of the production process with superior technologies in use at the Group’s plants. An additional investment focused on strengthening the sales and aftersales presence, has also brought the company closer to the client. As always we look to the past to tackle the future with greater strength. In the light of these results realized by the Pavan Group in recent years, we thought it appropriate to find a partner willing to continue this growth path by identifying an investor that, through a business approach, could strengthen its potential. Careful analysis and a shared planning made it possible to stimulate a financial operation that saw the private equity fund Alpha joining, in the very first months of 2015, the
corporate capital of Pavan Group. The management of the Pavan Group who led to results that have allowed us to grow in recent years, will continue contributing to our development. With this new partner we want to further confirm the Group’s leadership through investments in production and commercial infrastructure as well as pursuing an expansion strategy through targeted acquisitions of neighboring business segments. This operation is therefore aimed at creating value, development, growth, profitability along the management lines already successfully tested but with an even more solid financial foundation. We are and will be the same as before, stronger and growth-oriented, with and for our clients.
Dr. Andrea Cavagnis Chief Executive Officer Pavan Group 5
Pavan Group - Annual Report 2014
Corporate profile
The Pavan Group is among the world leaders in the design and engineering of technologies and integrated product lines for cereal-based food. This strong and solid organisation operates in the food industry as a global supplier of industrial solutions, from the handling of raw materials to final packaging.
6
The Group implements a full-service strategy that extends from research and the development of new products, to the design and engineering of manufacturing plants, after-sales training and client services. Over the years, the Pavan Group has strengthened its positioning and brand image due to its outstanding quality standards and product performance.
Pavan Group - Annual Report 2014
7
Pavan Group - Annual Report 2014
Financial results
2014 k€
2013 k€
2012 k€
2011 k€
2010 k€
2009 k€
157,700
139,368
136,111
122,756
107,114
83,438
EBITDA (operating results before interest, taxes, depreciation and amortisation)
30,308
23,554
21,719
19,464
17,238
10,636
Operating income
25,025
18,482
14,600
12,659
11,593
3,743
EBT (operating results before taxes)
25,033
17,059
16,758
12,282
10,342
4,265
Net profit
15,579
9,886
10,107
6,548
6,038
1,933
Cash flow
25,617
19,354
19,619
15,908
14,906
9,502
Net financial liquidity
36,021
37,404
19,653
2,680
20,221
17,252
Shareholders’ equity
57,526
52,753
49,492
40,250
35,992
30,343
TOTAL SALES REVENUE
8
Pavan Group - Annual Report 2014
9
Pavan Group - Annual Report 2014
Key figures
2009
2010
2011
2012
2013
2014
83
107
123
136
139
158
Export quota
95%
95%
95%
95%
90%
92%
Employees
563
597
603
609
686*
691*
Turnover (mlnâ‚Ź)
*includes GBS China Grain Manufacturing Co. Ltd.
10
Pavan Group - Annual Report 2014
BUSINESS UNITS Grain processing
Unloading systems, handling and cereal milling plants
Food processing
Manufacturing plants for pasta, extruded products, convenience food
Packaging
Packaging of food & non-food products
Storage
Storage systems for raw materials and finished products
SALES BY DIVISION - 2014
SALES BY CONTINENT - 2014
3 2
4
5
1
4 3
1 1.
Food processing
56%
2.
Grain processing
3. 4.
2
28%
1. 2.
America Europe
23% 33%
Packaging systems
14%
3.
Asia
13%
Storage systems
2%
4. 5.
Oceania Africa & Middle East
2% 29% 11
Pavan Group - Annual Report 2014
The creation of added value Overall net added value is a clear expression of the results generated by the Pavan Group, providing an appreciation of the resources distributed to all the stakeholders.
The added value distribution statement presented below describes in detail how this wealth has been distributed between the parties who have actively contributed to generating it.
Added value determination statement A
2014 k€
2013 k€
2012 k€
2011 k€
2010 k€
2009 k€
TOTAL OPERATING INCOME
162,462
139,368
138,353
125,618
112,467
84,822
Sales revenue
157,700
134,997
136,111
122,756
107,114
83,438
3,179
2,822
955
1,463
1,953
(271)
57
108
0
49
2,074
747
1,526
1,441
1,287
1,350
1,326
908
(97,292)
(82,933)
(85,043)
(75,914)
(68,628)
(51,364)
214
(662)
(798)
1,560
657
(261)
Purchases of raw materials, supplies, consumables and goods
(78,106)
(65,117)
(65,378)
(61,857)
(51,781)
(36,795)
Services
(18,246)
(17,229)
(17,742)
(14,937)
(16,058)
(13,689)
Leases and rentals
(144)
(142)
(140)
(82)
(98)
(57)
Provisions for risks
(112)
(167)
(154)
(84)
(164)
0
Write-downs and depreciation
(450)
(351)
(395)
(191)
(901)
(269)
Other operating costs
(448)
(589)
(436)
(323)
(283)
(293)
GROSS ADDED VALUE
65,170
56,435
53,310
49,704
43,839
33,458
Change in inventories of finished products Internal work and other capitalised costs Other revenues and income B
PRODUCTION COSTS Change in inventories of raw materials, supplies, consumables and goods
12
2014 k€
2013 k€
2012 k€
2011 k€
2010 k€
2009 k€
457
694
225
(30)
(134)
(108)
Other income
1,311
1,217
755
637
273
355
Other expense
(854)
(523)
(530)
(667)
(407)
(463)
(86)
1,040
1,082
249
181
15
63
228
1,082
341
182
292
(149)
1,268
0
(92)
(1)
(277)
OVERALL GROSS ADDED VALUE
65,541
56,089
54,617
49,923
43,886
33,365
Depreciation and amortisation
(6,028)
(6,405)
(6,570)
(7,211)
(6,042)
(5,978)
OVERALL NET ADDED VALUE
59,513
49,684
48,047
42,712
37,844
27,387
2014 k€
2013 k€
2012 k€
2011 k€
2010 k€
2009 k€
34,479
32,625
31,289
30,431
27,502
23,122
24,143
22,915
21,761
20,747
18,765
15,929
9,397
9,009
8,664
8,356
7,543
6,437
Temporary employment contracts
574
309
510
988
932
539
Personnel services
321
316
311
297
233
179
Personnel training
44
76
43
43
30
37
9,418
7,053
6,651
5,715
4,201
2,321
C OTHER AND NON-RECURRING ITEMS Net other income and expense
Net non-recurring income and expense Non-recurring income Non-recurring expense
Added value distribution statement A
HUMAN RESOURCES Employment costs Direct remuneration Pension funds and health insurance
B
SOCIAL SYSTEM (direct and indirect taxes)
C
ENTERPRISE SYSTEM (changes in reserves and distribution of dividends)
15,616
10,006
10,107
6,566
6,141
1,944
OVERALL NET ADDED VALUE
59,513
49,684
48,047
42,712
37,844
27,387
13
Pavan Group - Annual Report 2014
The highest number of complete lines ever installed. A success that demonstrate the sincere trust of the market.
NOR
SOUTH
14
TH ATLANTIC OCEA N
SO PAC
IFI
C O CE AN
ATLANTIC OCEAN H T U
Pavan Group - Annual Report 2014
NO
RT
H
PA
CI
FI
C
O
D IN
CEAN IAN O
2014
INSTALLATIONS Flour Mills, Dry and Fresh Pasta lines, Snack Pellet lines, Handling and Packaging systems.
>10
5-10
1-4
CE
A
Pavan Group - Annual Report 2014
PAVAN GROUP HEADQUARTERS
PAVAN GROUP ORGANISATION CHART
ADMINISTRATION
CORPORATE MARKETING
PURCHASING
MANAGEMENT CONTROL
IT
FINANCE
QUALITY
PAVAN
TORESANI
MAPIMPIANTI
Dry pasta
Fresh pasta
Extruded products
Sales area
Sales area
Sales area
Technical area
Technical area
Technical area
MONTONI
16
COMPANY SECRETARY’S OFFICE
DIZMA & STIAVELLI
Die cutting systems
Packaging division
Sales area
Sales area
Technical area
Technical area
Pavan Group - Annual Report 2014
Flour milling & grain handling
V.AL.IN.
PIZETA
Innovative food products
Food industry equipment
Sales area
Sales area
Sales area
Technical area
Technical area
Technical area
Purchasing
Quality
Purchasing
GOLFETTO SANGATI
Administration
TECNEL
Finance
Systems for automation
Sales area Technical area Purchasing
17
Pavan Group - Annual Report 2014
Human resources Competence development and enhancement: the key for the group’s growth Pavan Group continues into 2014 with the objective of enhancing and developing the skills of its human resources through specific training projects focused both on soft and hard skills. A training plan, aimed at analyzing performance and qualifications across the board, was carried out to the key figures dedicated to the management of the working groups. The ability to assess and endorse the most valuable elements within a work team and turn them into operational leading factors, increases the quality of each member’s participation. The intervention was delivered to a group of about thirty mid-level managers with the potential to effect approximately four hundred employees. Regarding the safety sector, besides specific training on the risks linked to various company activities, a training project was conducted on behavioral rules recommended to staff travelling in territories which pose special health risks. Staff efficiency and well-being while on business trips, reflect directly onto performance results among the clients and on the resources’ welfare, which represents the Company at all levels.
18
Articulated training programs on specific skills related to the use of design software were developed for the technical area. These skills are especially aimed at reducing design time while increasing working efficiency.
a working environment enables students to approach the world of employment with more awareness. This, coupled with greater training, will allow the Company to test academic and innovative skills of young resources with greater potential.
For a company that exports more than 90% of its production, language knowledge is a fundamental asset to be developed, hence language courses will continue. The simplicity of communication with our clients assumes more and more importance at all mediation levels.
Creating a work environment which allows growth and expression of individual ability represents a way to attract, develop and maintain quality human resources, the most important asset for a dynamic business Group constantly focused on future growth.
Collaboration with University education institutions in 2014 brought into the Company a considerable amount of students. Specifically the Group has joined the project “WORK EXPERIENCE” by inserting four recently graduated engineers into the software area. After a two month in-company training, they have completed a five month internship. Two of these interns became part of Pavan’s workforce with specific assignments to the automation development field. On to the educational level, middle school students were introduced to both the technical and administrative divisions. Real life experience in
2014 was a year defined by important investments aimed at introducing a younger generation of individuals with a high growth potential. In detail, twenty five team members in the technical area, five in the commercial area and five in the administration/ finance area. Throughout the year these team members have had the opportunity to get to know the Company’s dynamics, identify essential details of their work, while integrating themselves into a team where they can freely express their abilities.
Pavan Group - Annual Report 2014
691 EMPLOYEES
Average age
45.0
Employees with over 35 years of company seniority
25
CONTRACT TYPE
Average seniority
15.5
71
DISTRIBUTION BY GENDER
2
1
1.
Open-end
93%
1.
Women
15%
2.
Fixed time
7%
2.
Men
85%
2
1
TRAINING*
DISTRIBUTION BY AGE
4
3
Increases in level and recognitions
1
2
1
1. Sales and 19% administrator
1.
< 35
27%
2.
35 < 45
22%
3.
45 < 55
32%
2. Safety
38%
4.
> 55
19%
3. Technical area
43%
3
2
* 1034 hours of training provided
19
Pavan Group - Annual Report 2014
Corporate social responsibility For the Pavan Group, sustainability means offering innovative products and plants with maximum attention to all the effects of its activities on the surrounding environment, and on all stakeholders who gravitate around the Group, with the aim of consolidating a business model that creates value for all. We are aware that every activity carried out and every decision taken involves economic, but
also social, consequences. No matter where in the world, we ensure transparent and fair behaviour towards our colleagues, customers and suppliers. For us, respect for people, shared social values and the commitments made, is a rule of conduct essential to developing sincere, lasting and profitable relationships.
PAVAN’S SOCIAL COMMITMENT
In addition to projects aimed at fighting malnutrition and starting sustainable growth models, Pavan firmly believes in the potential of voluntary work and associations. The sponsorship programme includes several social projects. ”Chernobyl Project” On the initiative of families and local associations, a number of children from Belarus who are affected by the radiation effects of the toxic cloud from Chernobyl are hosted every year during the summer period. Their stay in Italy allows them to receive health care and, at the same time, to enjoy happier environments and situations. Pavan supports the initiative by contributing to the airfares of these children. ”I Ragazzi del Sole” A project aimed at the integration, independence and socialisation of children with disabilities.
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”Comunità di San Patrignano” The objective of this community is to take care of and cure marginalised people and drug addicts, without any social, political or religious discrimination. ”Città della Speranza” Every year the Pavan Group participates as an active sponsor to sport events organized to support ”Città della Speranza”, a leading foundation in the research and treatment of infant leukaemia. A company team from Pavan participated at the marathon organized at Padova. ”Seniores Italia” Non-profit association that promotes the cooperation between professionals and organizations involved in the development of local production system in the emerging market countries. ”AVIS” Avis is a voluntary association founded by those who donate their blood on a
voluntary basis, free of charge, regularly and anonymously. It is an entirely nonprofit association pursuing goals of human solidarity. ”La caramella buona” ”La caramella buona” is a non lucrative and social utility organisation against paedophilia. Since 1997 the activity has been focusing on prevention and repression of the crime of paedophilia, of individual sexual abuse, of stalking against women. More specifically, this Onlus takes care of legally protecting the injured parties in trials where charges have been made to sex offenders, and to provide qualified care to the victims of abuse, as well as to their families. This association provides training for the various figures involved in the care of victims, and promotes phenomenon prevention activities by conveying relevant information to parents, adolescents, and children. The Onlus runs the network of ”Case Buone”, apartments for free of charge first aid reception for women and children in emergency conditions.
Pavan Group - Annual Report 2014
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Pavan Group - Annual Report 2014
Study, sport, culture PROMOTING KNOWLEDGE
PROMOTING SPORT
PROMOTING CULTURE
For the children of its employees, every year Pavan offers Study Scholarships for upper secondary school students and University students who stand out for excellence in technical and scientific subjects.
Team spirit is one of the values characterising the organisational structure of Pavan. Sport as a metaphor for cooperation and the importance of the role of each individual, leads Pavan to support regional initiatives of international importance. Pavan is a sponsor of the Petrarca Rugby team. Furthermore, the Pavan Group also substaiend the national association for ”Wheelchair Rugby”: a specific sport practiced by people with phisical disabilities. Even if played in a different way, it maintains and strengthens the values that distinguish rugby.
This commitment to the cultural field is based on the conviction that experience in this area encourages qualities and characteristics that are all-important in the field of work: creativity, intellectual interest, openness to new experiences and the ability to interact with the others.
In 2014, two scholarships were granted for University students and three for High school students.
22
In this perspective, the Pavan Group sponsors the concert activities of ”I Solisti Veneti” in the context of the ”Veneto Festival”.
Pavan Group - Annual Report 2014
23
Pavan Group - Annual Report 2014
Sustainability Pavan shares a strong commitment to protect the environment and scarce resources, now and for future generations, improving efficiency in operations and involving all suppliers to continuously optimize the environmental performance of Pavan equipment along the entire value chain.
internal processes: in 2012 an internal campaign has been activated to limit the paper usage, especially by digitalizing archives and optimizing the utilization of each sheet. Furthermore, since 2008 all brochures and leaflets have been printed on certified FSC paper, a mark that identifies the products containing wood coming from forests managed in a correct and responsible way
This effort is oriented also towards
according to rigorous environmental friendly, social and economic standards. In 2014 water, methane gas and paper consumption have been significantly reduced. Furthermore the recent investment in the photovoltaic system installed at Golfetto Sangati, allowed a substantial decrease of CO2 emissions.
WATER CONSUMPTION (in thousands of m3)
0
1
2
3
4
5
6
7
8 7,959
2014 7,162
2013
8,450
2012 2011
8,742
2010
8,767
20 TURNOVER (mlnâ&#x201A;Ź)
24
9
40
60
80
100
120
140
160
Pavan Group - Annual Report 2014
ENERGY CONSUMPTION (in millions of kWh)
0
1
3
2
2014
4
1.8
2013
2.51 3.3
2012 2011
2.94
2010
2.76
20
40
60
80
100
120
140
160
700
800
TURNOVER (mln€)
METHANE GAS CONSUMPTION (in thousands of m3)
0
100
200
300
400
500
600
328
2014
360
2013
684
2012 600
2011 450
2010
20
40
60
80
100
120
140
160
TURNOVER (mln€)
25
Pavan Group - Annual Report 2014
PAPER CONSUMPTION (in tons) 0
2
4
6
8
10
12
5.2
2014
7.6
2013
8.6
2012
8.8
2011
11.7
2010
40
80
100
120
140
160
TURNOVER (mlnâ&#x201A;Ź)
WASTE DISPOSAL (in kg) 2014
2013
2012
2011
2010
145,145
119,410
199,625
185,435
120,580
Disposal of aluminum
910
1,085
1,620
1,385
1,885
Disposal of copper, bronze, brass
125
250
460
0
0
31,188
27,814
46,706
22,037
17,268
Disposal of chips, dust, ferrous and non-ferrous material particulate
Disposal of wood and metal packing The data covers the factories at Galliera Veneta, Quinto di Treviso and Manfredonia. The 2010-2011 data has been updated using this criterion
26
Pavan Group - Annual Report 2014
â&#x20AC;&#x153;
In recent times electricity, methane gas and paper consumption have experienced a strong drop off
â&#x20AC;?
27
Pavan Group - Annual Report 2014
Sharing knowledge FOOD TECH MASTER Promoting knowledge, as well as creating international relation networks: this is the inspiration guiding Pavan School of Food Technology, which in 2014 brought successfully to an end two editions of Food Tech Master. More than 50 students coming from all over the world took part in two courses on production technologies for Snack Pellet and Dry Pasta. Lessons were held in the Conference Centre at Pavan Group Headquarters. Training ever more qualified experts is a challenge that the Group determines to face and win over, keeping professionals in the sector updated (installation managers,
production managers, Research and Development directors, Quality Control supervisors and production technicians), as well as training new entry professional figures. The didactic offer was structured in such a way as to provide a sound theoretical base, with the introduction of elements of chemistry, physics and rheology. The training course then proceeded to exploring the more practical aspects of system operation, with organoleptic and sensory evaluation tests, the production of pasta by pilot systems operating in the R&D area, and through visits to industrial installations where applied technologies with fully operational production activities can be observed.
Lessons were held by experts coming from Universities, institutions linked to the academic world and by process engineers of Pavan Group. A strong point of Food Tech Master sessions is the capability to involve students, creating a cohesive study and work group during the training course, which can then be translated into a network of relationships that goes beyond the training experience, and which is useful for the future pathway of all participants. For this purpose, the official blog offers the students’ community the opportunity to exchange ideas and experiences. For further information visit www.foodtechmaster.com/
ACADEMIC WORLD
Constant research by Pavan is supported by several relationships with Universities and the academic world. Specific projects and research activities are carried out with: • University of Udine (Department of Food Science) • University of Calabria (Department of Modelling for Engineering) 28
• D.I.S.T.A.M. (Department of Food Science and Microbiology) of the University of Milan. • Experimental Institute for Grain Growth of Rome. • National Institute for Research of Food Products and nutrition of Rome. • University of Molise (DISTAAM Department of Food Technology).
• TecnoAlimenti of which Pavan is co-founder. • U.C.M.A. (Union of Manufacturers for the Food Industry), within which Pavan has promoted the definition of ”European Standards” for the safety of systems for the production of fresh pasta.
Pavan Group - Annual Report 2014
“
Sharing knowledge is our main purpose
”
29
DIRECTORS AND AUDITORS
PAVAN s.r.l.
PIZETA s.r.l.
BOARD OF DIRECTORS
BOARD OF DIRECTORS
Chairman: Angelo Ferro
Chairman: Andrea Cavagnis
CEO: Andrea Cavagnis
CEO: Pietro Zanetti
Director: Edoardo Lanzavecchia
Director: Claudio Zavatta
Director: Valentina Pippolo Director: Marco Bernardi
TECNEL s.r.l.
BOARD OF AUDITORS
BOARD OF DIRECTORS
Chairman: Roland Rabanser
Chairman: Andrea Cavagnis
Auditor: Raoul Francesco Vitulo
Managing Director: Nicola Tiatto
Auditor: Maurizio Salom
Director: Pasqualino Cauzzo
AUDITORS Deloitte & Touche
VALIN s.r.l. BOARD OF DIRECTORS
GOLFETTO SANGATI s.r.l.
Chairman: Andrea Cavagnis
BOARD OF DIRECTORS
CEO: Mauro Costa
Chairman: Andrea Cavagnis
Director: Mauro Criscuolo
CEO: Claudio Zavatta
Director: Pasqualino Cauzzo
Director: Pasqualino Cauzzo
AUDITORS
AUDITORS
Deloitte & Touche
Deloitte & Touche
30
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Pavan Group Headquarters Via Monte Grappa, 8 Galliera Veneta - PD Italy info@pavan.com www.pavangroup.com