Annual Report The Greenery 2009 by The Greenery

The Greenery

Set for the future 2009 Annual Report

Contents Introduction..................................................................................................................................... 2 1. Long-term offensive strategy sees early signs of success. ..................................... 4 2. Financial results and developments. .......................................................................... 7 3. Key figures. ....................................................................................................................... 9

Part 1. General Management Report. ................................................................................ 10 1. Flexible commercial policy............................................................................................... 11 2. Serving a huge market while maintaining grower focus. ...................................... 14 3. Tightened strategy bears fruit. ....................................................................................... 17 4. From controller to supervisor. ......................................................................................... 19 5. Focus on corporate culture strengthens strategy implementation...................... 21 6. New cooperation model. .................................................................................................. 23 7. Stepping stone to 2010..................................................................................................... 25

Part 2. Reports of the governing bodies........................................................................... 26 1. Profile..................................................................................................................................... 27 2. Corporate governance. ...................................................................................................... 28 3. Supervisory Board Report................................................................................................. 31 4. Report of the Cooperativeâ&#x20AC;&#x2122;s Management Board. ..................................................... 32

Part 3. Financial statements. .................................................................................................. 34 1. Consolidated balance sheet as at 31 December 2009............................................. 35 2. Consolidated profit and loss account for 2009........................................................... 36 3. Consolidated cash flow statement for 2009............................................................... 37 4. Statement of changes in equity for 2009.................................................................... 38 5. General notes....................................................................................................................... 38 6. Notes to the consolidated balance sheet. ................................................................... 44 7. Notes to the consolidated profit and loss account.................................................... 54 8. Company balance sheet as at 31 December 2009.................................................... 57 9. Company profit and loss account for 2009.................................................................. 57 10. Notes to the financial statements................................................................................. 58 11. List of participating interests. ......................................................................................... 61 12. Other information............................................................................................................... 62 12.1 Articles of association provisions governing profit appropriation........................ 62 12.2 Proposed profit appropriation. ....................................................................................... 62

Publication information............................................................................................................. 64

Introduction The fruit, vegetable and potato industry again experienced an eventful year in 2009. The price of fruit, vegetables and potatoes was strongly. affected by the distorted balance between supply and demand, the shift in product flows at European level and the impact of the financial and economic crisis. Pricing had an adverse impact on The Greeneryâ&#x20AC;&#x2122;s turnover. The difficult market and pricing situation not only affected The Greenery; its growers in particular suffered the impact.

The Greenery successfully implemented its strategy in a year characterised by a severe economic downturn. The sales structure was reinforced and services to members (growers) and customers were boosted. As a result, market share increased in the domestic (Dutch) and international retail markets. The Cooperative offered growers a new form of cooperation through the trading company, which will operate under the new name of. Coforta in 2010.

Pricing Growers/members measure the performance of their sales organisation based on the price they receive for their produce. Worldwide, prices for fruit, vegetables and potatoes were below par. The Greenery’s growers recieved a dissapointing price for their products. The payout prices were, in comparison to the market, amongst the highest. The Greenery demonstrated its leadership role in the cooperative horticultural industry by enabling new forms of cooperation between the Cooperative, growers and the trading company and facilitating the bundling of supply chains in this manner. The new cooperation models and the grower prices achieved did not go un noticed. New members applied to The Greenery and only a small number of members left, primarily on account of the discontinuation of their business. As a result, The Greenery reflected positive member ship turnover on 1 January 2010.

Flexibility A new system of tariffs and levies was introduced in 2009. The system, which is based on the ‘cost generator-cost bearer’ principle, provides members with detailed insight into the various processes and corresponding costs. Cost awareness among the growers and the trading company rose as a result of the introduction of this system. Working methods and processes were adapted and organised more efficiently. Costs are expected to decrease by EUR 10 million in 2010. The economic conditions brought about a change in customer risk profiles, as a consequence of which The Greenery adjusted its export policy. Risk cover age for debtors in Eastern Europe and in the United Kingdom was abandoned and credit insurance policies were cancelled. This required a flexible and adaptive commercial policy. Product flows into the markets that had in fact grown strongly over the past years had to be allocated elsewhere.

Opportunities Market developments also offered opportunities. More deliveries were made to existing markets and by reorganising sales activities and intensifying marketing activities the company was able to enter

new markets. Supply chain projects were set up with a large number of partners worldwide, with a focus on food safety and sustainable growing methods. Closer to home, Hollander Phase 2 was completed in April 2009, involving a substantial expansion of the Fresh Produce Distribution Centre (VDC) in the Netherlands.

Operational excellence In 2009 the commercial and service departments worked to achieve operational excellence. This is an ongoing process that will continue in the coming years. In the year under review this involved auto mation and standardisation of internal logistics processes and optimisation and shortening of the goods flows. The service departments promoted operational excellence by applying more tailormade services to fulfil the customers’ wishes. This will enable The Greenery to continue to evolve its role as that of a partner for retail organisations to help manage the ever-increasing flows of fresh produce.

New cooperation model A new cooperation model between growers and The Greenery introduced in the course of 2009 provides for a separate positioning for the trading company and the Cooperative. The Cooperative has reinforced its own strategy and has changed its form of cooperation with members. The trading company will fully pursue its strategy of providing added value. Growers are free to choose the form of cooperation they wish to pursue with the trading company. This may be a form of cooperation directed at creating sustainable value or a business-driven commercial relationship involving sales to both the trading company and to Dutch wholesalers and exporters. Following the careful introduction of this far-reach ing plan, a large majority of the Members’ Council voted in favour of the new cooperation model. In early February 2010 the affiliated growers announced their choice for a partnering relation ship or a transactional relationship. Around 86% of growers chose a partnering relationship and 14% a transactional relationship.

Long-term offensive strategy sees early signs of success In 2009 The Greenery implemented its new strategy formulated at the end of 2008. ‘Creating a healthy business through highly effective collaboration’ is the goal pursued by the trading company comprising five cornerstones: cost savings, market-orientation, supply chain optimisation, volume growth and. corporate culture. The challenges, projects and. results of this offensive policy form the underlying theme of this Annual Report. An important pillar underpinning The Greenery’s strategy is the firm ambition to work as efficiently and as cost-consciously as possible. This ambition was applied to departmental level operational plans in 2009, which produced savings on the one hand and created improved customer and grower services on the other. 4

The Fit4Future result improvement programme initiated in 2007 was fully incorporated into the strategy. By embedding this programme into oper ational excellence projects the envisaged EUR 25 million improvement in results was achieved in 2009.

tariffs may be considered among the lowest in the Netherlands. The operational excellence strategy included other measures, such as automated packaging facilities for smaller products at various locations and LEAN projects in Bleiswijk (The Netherlands). All projects were aimed at further enhancing customer service and offering added value. By efficiently organising product flows and business processes, The Greenery has created growth opportunities both with cus tomers buying bulk products and with customers focusing on selling niche products. This differenti ates The Greenery from other providers across the entire European fruit, vegetable and potato market. Changing markets, pressure on the consumption of fruit, vegetables and potatoes, and the surplus on the European market created challenges for a market-oriented business. Market orientation was mainly reflected in adequately anticipating the changed market conditions in 2009. This is illus trated by the strategic reorganisation of the sales

Creating a healthy business through highly effective collaboration is the goal pursued by The Greenery Cost awareness was also applied to the reward system The Greenery offers its growers. The intro duction of the Individual Grower’s Price (Individueel Uitbetaal Prijs (IUP)) three years ago represented a first step in meeting the growers’ wish for tailored services. In 2009 a second step followed - the implementation of a new tariff and levies system. The system created transparency and provided insight into the specific costs of processes and services. The ensuing operational excellence programme helped reduce the cost of grower services by EUR 10 million. The Greenery’s current

structure, the expansion of marketing support and logistics services for customers and the establish ment of product management teams. Changing consumer market trends were anticipated through the introduction of new products and concepts and by opening new channels. A key factor in a market-oriented business approach, in addition to meeting both customer and consumer expectations, is to ensure that highquality fresh fruit and vegetables reach the shop shelves as fast as possible. Supply chain optimisation

therefore is a third important pillar of The Greenery’s strategy. Various courses of action taken in 2009 brought about substantial improvements in the efficiency of the food chain. Direct connections between growers and customers, the alignment of ICT systems between The Greenery and its customers and the reorganisation of logistics flows by the Supply Chain Management Department were con tributory factors. In some cases customers linked a communication campaign to these projects and in all cases customers and consumers witnessed improvement on the shop shelves.

pursue its strategy of providing added value. The Greenery will remain the pre-eminent source of Dutch produce and a partner for the domestic and international retail markets.

Strategy implementation generated an increased retail market share. The Greenery targets mainly the European retail market, which accounts for more than half of the company’s current volume. The company aims to increase this percentage even further. The above developments have not yet gen erated the intended volume growth across the whole product range. The impact of the economic crisis, the disappearance of key export markets and changing consumption patterns proved too vast to achieve this goal.

The strategy and efforts of the growers and The Greenery employees bore their first fruits. The efforts of our employees are particularly important. In The Greenery’s view, operational excellence is founded on more than simply efficient processes and opera tions. The corporate culture of The Greenery and the conduct of its employees also have a role in this context. The Greenery supports its pursuit of operational excellence by cultivating cultural activities and offering a comprehensive training programme. In 2009 The Greenery made a substantial invest ment in a new cooperation model between the Cooperative, its members and the trading company. The trading company aims to focus more strongly on customer service. The partnering relationship the company enjoys with the majority of growers enables an even closer and more market-oriented form of cooperation. The trading company will fully

Ph.R.J. Smits General Manager The Greenery B.V.

Th.L.J. Ammerlaan Chairman Coöperatie The Greenery U.A.

Financial results and developments Net profit for the 2009 financial year was EUR 7.4 million compared with EUR 8.7 million in 2008. The prices for fruit and vegetables grown in the Netherlands were some 15% lower than in 2008, a dramatic development not least for the growers. As a result of this pricing development, turnover for the whole of The Greenery declined by 10% to EUR 1.608 million. Due to a successful cost control programme, the operating result improved from EUR 10 million in 2008 to EUR 14 million in 2009.

efficiency in the distribution centres. These meas ures enabled space to be leased to third parties and space in ‘de Lier’, The Netherlands to be sold. As a consequence of the valuation of assets at current value, only a small book profit was posted for 2009. Due to revaluation the profit was added to equity. The goal set in 2008 to take measures totalling EUR 25 million was achieved, which enabled The Greenery to absorb the pressure on prices and margins. Members of The Greenery however received a dissapointing price for their produce.

The drop in fruit and vegetable prices is a conse quence of wide availability in North West Europe, combined with a slight decline in consumption. Economic conditions caused consumers to make more price-conscious purchases. The economic crisis furthermore accounted for the strong fall in exports

The increase in personnel expenses is mainly attributable to a non-recurring payment resulting from the new Collective Labour Agreement as well as a further increase in the services provided by Hollander. In the context of the latter activity, the expansion of the distribution centre was completed,

Measures taken under the fit4thefuture result improvement programme have reduced costs to Eastern Europe. Although sales to the United States of America were up, on balance strong downward pressure on prices was seen. Lower prices for growers have led an expanding group of growers to believe that further bundling of the supply chain will produce better prices. The Greenery generally shares this opinion and is actively involved in forming collaborative partner ships with producer organisations. However, The Greenery also believes that bundling the supply chain should not be the only action taken but that continued focus on the customer and continuous performance improvement will create better prices. The operational excellence programme has brought about lower costs, resulting from the use of less space, reducing transport and achieving greater

which largely accounted for the higher deprecia tion costs. As a result of the above developments, the operating result totalled EUR 14 million (2008: EUR 10 million). The net result for 2009 of EUR 7 million was lower than last year (2008: EUR 9 million) due to a one-off corporate income tax gain of around EUR 3.5 million in 2008.

Financial income and expenses The balance of income and expenses mainly concerns interest charges and in 2009 amounted to an expense of EUR 9 million compared with EUR 8 million in 2008. Interest charges were higher due to higher average interest rates and slightly higher average use of the banking credit facility.

Disposals and investments In 2009 cash flows from investments in material fixed assets (EUR 18.1 million) exceeded cash flows from disposals (EUR 0.3 million). Investments mainly concerned completion of the expansion of a new distribution centre in Barendrecht (The Nether lands) to enhance the logistics services provided to third parties. In addition, investments were mainly made in replacement machinery and vehicles in an effort to improve efficiency at the Cooperative’s grower members. Disposals related primarily to obsolete real estate. In addition disposals were made of obsolete real estate, financial settlement of which will take place in 2010.

Financing The Greenery’s equity rose to EUR 63 million in 2009 as a result of additions to the result. As a consequence solvency increased to 12.3%. 8

In real terms the capital base declined slightly by EUR 4 million. Due to the decrease in the balance sheet total, the capital base as a percentage of the balance sheet total increased by 1% reaching a satisfactory level of 40%. The effects of the financial crisis also took their toll on The Greenery. Consequently debtor risk increased, which was affected by revoked debtor credit limits, and the payment behaviour of customers deteriorated. This was one of the factors behind the increased use of the banking credit facility during the course of the year. Member loans fell by EUR 3 million to EUR 94 million. The fall is attributable to the way the member loans have been structured, whereby accrued annual payments are released following an eightyear term. These subordinated loans granted by members to The Greenery are an important part of the organisation’s capital base. Member loans are mainly established by annually withholding 1% of the grower price payments to members and converting these withheld amounts into loans with an eight-year term. The interest to be paid on these loans is set only once at the beginning of the loan and, for members, is based on the return on government loans with a term of eight years in creased by a mark-up of 1.4 percentage points.

Outlook Although we have every confidence in 2010, The Greenery expects that it will be a difficult year for the horticultural industry. This means that it remains essential to maintain focus on costs. Cost increases will have to be counterbalanced by improved margins as well as cost savings. Further more, recent developments particularly in the Dutch retail market offer The Greenery every opportunity to continue to evolve as a retail specialist. In 2010 investments will mainly relate to maintenance and replacement machines with a view to achieving efficiency gains. Investments will be financed from cash flows.

KEY FIGURES CoĂśperatie The Greenery U.A CONSOLIDATED PROFIT AND LOSS ACCOUNT Turnover from membersâ&#x20AC;&#x2122; products

2009

2008

633 763

Total operating income

1,627

Volume increase/decrease

(2%) (5%)

Net turnover

1,814

1,149

1,308

231

221

Personnel costs

Depreciation and amortisation

Gross contribution

Other operating costs

217

211

Operating result

Financial income and expenses

(9)

(8)

Tax on profit

(2)

Profit from participating interests

Minority shares in group profit

Net profit

(25)

508

531

Other operating expenses

Cash flows Investments Disposals

Cash flow from operating and investing activities

Equity and financing Balance sheet total Invested capital Return on average invested capital Capital base Capital base as a percentage of total assets Interest-bearing debt Member loans

320

289

4,5%

3,5%

201

205

39,6%

38,7%

146

133

1,655

1,661

Number of employees Full-time equivalents (FTEs) as at 31 December

(in millions of euros)

Part 1

General Management Report

1.1 Flexible commercial policy Commercial policy in 2009 was characterised by the complexity of balancing a good grower price on the one hand and a competitive and effective sales policy on the other. The Greenery anticipated the changed market conditions in its commercial policy, evaluated the customer portfolio and. entered new markets. There was a clear goal: to maintain and strengthen the position of The Greenery in a difficult oversupply market. The set up of the new sales structure is aligned with a geographically-oriented commercial policy, directed towards anticipating the strongly diver gent market developments and fully satisfying customers’ wishes. Under the new sales structure, the Commercial Departments for the Benelux, Germany/Scandinavia, the United Kingdom, Russia, Central Europe, Southern Europe and Overseas (USA, Canada, the Middle East, Japan and the Far East) are responsible for their own geographic markets. The Commercial Departments, NL Sourcing and Imports, are responsible for purchasing produce in The Netherlands and abroad. The re

organisations who form a solid foundation for the new venture. The Greenery is convinced that for the very reason that economies of scale have arisen, there is a need for an adequate and continuous supply of quality products, and services tailored specifically to both supermarket concepts. In 2009 volumes in major export markets for The Netherlands declined. Eastern Europe and Russia, markets recording double-digit growth over the past years, declined as a result of the economic crisis that strongly affected the consumption of fruit, vegetables and potatoes on the one hand and of the Russian government’s changed import policy on the other. Complications concerning export insurances for certain areas also caused volumes for these markets to fall. Nonetheless this region remains strategically important to The Greenery. Eastern Europe continues to be a market offering huge growth potential. This was The Greenery’s rationale for opening a branch in Poland some time ago and for looking into other options for setting up business in this region.

The Greenery anticipated the changed market conditions in its commercial policy structuring of the commercial organisation enables us to pursue a flexible commercial policy allowing various propositions to be offered to customers, tailored to their wishes. On the Benelux home market the trend for retail consolidation continued. In The Netherlands the Jumbo supermarket chain announced the takeover of the Super de Boer supermarkets. The Jumbo and C1000 supermarket chains subsequently announced their intent to set up ‘Bijeen’ (literally translated as ‘Together’), a joint purchasing organi sation, the aim of which is to strengthen and inten sify relations with the existing clients of both

The Greenery strengthened its position in the United Kingdom and Southern Europe. Contrary to the trend of a devaluing GB pound, good performance was achieved in the U.K. market. The Greenery was able to reinforce its position among the leading retailers, despite the difficulties experienced by the premium produce segment. Furthermore, Greenery UK in Huntingdon was successful in attracting new clients by developing new products, including miniplum tomatoes in a bag, tailoring services to specific customer wishes and pursuing a competitive com mercial sales policy. The Greenery’s activities in Southern Europe, particularly in Italy, grew strongly. The availability of additional volumes enabled

The Greenery to reinforce its position in Italy. The challenge in 2010 will be to maintain this position. In 2009 efforts were undertaken to create more synergies between the Marketing, Supply Chain Management and ICT service departments. These efforts contributed to the Sales Department’s results. We were successful in launching new value added concepts on the German market, which features market-oriented pricing. By collaborating more closely within the organisation, improved perform ance was achieved at various German retailers. Import Department volumes stabilised due to developments in Eastern Europe and Russia, the failure of rich soil cultivation in Spain and reduced consumer demand for exotic and imported products.

Volume breakdown by region Netherlands 50%

Rest of Europe 21%

Germany 11%

Rest of the world 5%

United Kingdom 13%

The year 2010 will pose many challenges for The Greenery’s sales activities. The new geographic organisational structure and stronger customer ties have resulted in a solid foundation, from which more effective use can be made of the commercial opportunities that will continue to arise in the market.

Diversification The Greenery aims to increase volume by focusing on product diversification and expanding the product range for both existing and new customers. This will be accomplished by launching highly innovative concepts and varieties. New varieties will be grown exclusively for The Greenery, serving to create further differentiation. As a result of wide market interest, new customers have been attracted and exports have grown. Sales of the Junami, Rubens and Wellant apple varieties and the Sweet Sensation pear have been particularly successful.

The department improved its results by focusing on working more closely with other commercial departments on retail deliveries, cost savings and further efficiency gains in the administrative, opera tional and logistics management processes.

Short supply chain Hollander Barendrecht, which forms part of The Greenery, organised the entire distribution of fresh produce from its own Fresh Produce Distribution Centre, VDC, for Dutch food company PLUS Retail in 2009. Sixty percent . of inbound flows of produce are stored in different temperature zones and picked. The remaining forty percent are cross-docked. Integration between the supplier and buyer occurs upstream in the supply chain. Efforts were also undertaken downstream to shorten the supply chain. Grower produce is delivered in closed supply chains to the supermarket, carrying unique product codes and subject to specific quality requirements and firm agreements on stock management and delivery percentages.

1.2 S erving a huge market while maintaining grower focus Sourcing Netherlands, which is responsible for flows of Dutch produce, focused on reducing operating costs further and structuring a new marketoriented organisation in 2009. The creation of product management teams resulted in improved process management and enabled improved. coordination between the trading company, growers and customers. Further implementation of the ‘cost generator-cost bearer principle’ brought about increased cost awareness among both growers and the trading company. The operational excellence programme and the associated efficiency measures helped reduce the cost level for our growers by EUR 10 million.

Market-oriented production requires efficient process management, extensive knowledge of market developments and clear communication. The crea tion of five product management teams lead to increased services for growers and sound direction based on market figures. The management teams for hard fruit, soft fruit, mushrooms, rich soil produce and vegetable fruits achieved stronger performance in the areas of supply chain manage ment, logistics control, food safety and marketing. Various new concepts and innovations were devel oped as a result of improved collaboration and the specific direction given to growers. In consultation with hard fruit growers, a sales plan was devised for the new Sweet Sensation pear variety. In conjunction with the marketing department and the pear variety owner, the product managers developed a distinct logo and communication concept for worldwide application. As a result of the intensive collaboration between the management teams, the Supply Chain Manage ment Department and customers, in 2009 new direct interfaces for various products were created between growers and customers. These operations require maximum coordination between the grower’s organisation and the customer’s distribution centre.

New collaborative partnerships for local deliveries to supermarkets are being studied. In 2009, again in consultation with the growers, The Greenery itemised the costs of each process and each link in the food chain. This resulted in the implementation of a new tariff and levies system based on the principle that the costs incurred should be borne by the party that generates them. This represents the next step in the Individual Grower Price System introduced earlier and imple mented in the product group-oriented organisation structure. The new system makes all costs transparent and rewards logistics efficiency in the supply chain. The resultant measures have led to lower costs. This means a substantially lower tariff for The Greenery’s growers for 2010 and, compared with the market, a maximum grower price. Grower prices ranked among the average top prices in the market last year but in the year under review were mostly below the growers’ cost level. This was caused mainly by the imbalance between supply and demand, exchange rate fluctuations in key mar kets and the decline of export markets in Eastern Europe. The demand for supply chain bundling therefore was a key industry theme in 2009. The Greenery actively participated in the discussions and views the establishment of Producer Organisa tion Associations (APOs) as a stepping stone for creating a more structural form of supply chain bundling: a merger. This will create sufficient econ omies of scale in order to serve European retailers with an optimum product and service offering. Product volumes and product availability will be well-coordinated based on the customers’ scale. The Greenery believes that the grower will benefit primarily from concentrating sales through a limited number of sales organisations. These sales should self-evidently be organised by an organisation that itself has sufficient scale and has low operating costs. The first firm steps were taken in 2009.

The Greenery has improved both internal logistics processes and external product flows on behalf of its customers. By standardising internal processes, optimising the central control system and introducing new working methods for goods flow control, The Greenery has achieved cost savings and created higher levels of service. The structural collaboration with customers on goods flow control and the successful pilot programme conducted with an

SOURCING AND FORMS OF COOPERATION Individualisation of the relationship between the grower and the Cooperative is a long-term trend that has long affected grower prices, not only in the distribution of costs but now also in the choice of how to enter the market. In business new choices are currently being made and facilitated by the Cooperative. The new cooperation model offers the Sourcing Department . new opportunities and a new identity, that of sales manager, product manager and purchaser. The latter area in particular is becoming more professional. This has created a more business-oriented relationship that has done away with automatic arrangements without affecting the trend towards further economies of scale. And it encourages the ‘new’ style of sourcing in order to offer growers a new perspective.

integrated control system for commercial and logistics processes created shorter food chains. Furthermore, in 2009 new initiatives were taken to obtain the Authorised Economic Administrator (AOE) certificate. This Netherlands’ Customs certificate will enable The Greenery to streamline its international import and export flows and reinforce its market position as an international service provider. The Netherlands Sourcing Department will gain a different function and job content in the new coop eration model. The grower-related knowledge and expertise that the department has built up will remain intact and will be deployed to develop product business plans for the partnering or ‘P’ relationship form of cooperation. These plans will incorporate strategic and supply chain-specific objectives aimed at creating value for the product. A market-oriented sales programme will be devel oped together with these growers. Seductive pear In 2009 the first volumes of the Sweet Sensation peer were commercially harvested. The Greenery is . currently launching the pear to retail customers. The Sweet Sensation pear has gained a unique logo designed to appeal primarily to a younger target group. The visual identity and logo with the seductive mouth distinguish the Sweet Sensation pear on the shelves. In early December 2009 an agreement was signed with Capespan South Africa to supply Sweet Sensation pears all year round.

Fred & Ed In 2009 The Greenery developed a new fruit and vegetable snack together with FoodSense: Fred & Edâ&#x20AC;&#x2122;s fruit and vegetable snacks. By using the Fred & Ed characters that are popular among children, The Greenery aims to encourage children and young adults to eat more fruit and vegetables. The new Fred & Ed range of vegetable snacks comprises seasonal fruit varieties and vegetables that are available all year round.

1.3 T ightened marketing strategy bears fruit The marketing strategy focus is to provide added value. The Greenery achieved this in 2009 by launching new products and concepts based on market data and consumer research. Trade marketing activities and client services were expanded, new sales channels were opened and specific promotions were carried out, where needed.. Research conducted on new marketing opportunities resulted in initiating E-marketing activities and in strengthening The Greenery’s online presence. This was carried out in a consistent, distinguishable style, based on The Greenery’s five core values: high quality, entrepreneurial, fresh, well-considered and trendsetting. The Greenery is working on a leadership position in the fruit, vegetable and potato category. Marketing plays an important part in achieving this objective. Over the past years The Greenery has continued to professionalise and expand its services. Its wide array of support activities ranges from supply chain projects and category analyses to shop floor promotions. In 2009 retailers indicated that they wanted to continue optimising the fruit, vegetable and potato category, which forms an important part of their business. They require increasingly more support tailored specifically to their own shopping concept and positioning. In conjunction with Account Management and Sales, products and services were tailored more specifically to the customers’ wishes – on the one hand, by responding immediately to demand and, on the other, by rapidly anticipating market developments. This has proven to be a sound approach as evidenced by the rein forcement of The Greenery’s current position among a number of major European retailers. The retail market regards The Greenery as a supply chain partner that adds value to its own proposition. Marketing activities clearly reflected The Greenery’s strategy of pursuing a market-oriented approach aimed at volume growth. In 2009 together with the commercial Sourcing and Sales departments,

various supply chain projects were undertaken aimed at making produce more readily available in the shop shelves. Marketing played a major part in developing the concept as well as in rolling out the projects. A new survey added a deeper dimension to the shoppers’ survey conducted in 2008. The re sults provided more insight into consumer behaviour and resulted in significantly enhanced customer support activities such as category projects, analyses and shelf management. Furthermore, customers were supported with numerous other trade and marketing activities designed to match individual retail concepts. In some instances, this involved shop floor activities and materials, in other instances training employees in the fruit, vegetable and potato industry or jointly carrying out product demonstrations on the shop floor. Regular customers in wholesale businesses, the industry and other channels benefited from these efforts. Highly focused consumer promotions were carried out. New initiatives were undertaken in response to questions arising on the origin of produce and the cultivation method. The Greenery’s growers gained an online presence with the launch of the website www.verseoogst.nl. The website’s func tionality was incorporated into customer promo tional campaigns, such as new product campaigns for Rubens apples, Sweet Sensation pears, Vitapauze (see box) and the tiny Pick & Mix snack tomatoes. Eating fruit and vegetables is child’s play In 2009 The Greenery introduced the school fruit . programme Vitapauze: a range of fruit and vegetables distributed daily to all school classes based on the ‘school milk method’. Vitapauze was launched at a large number of schools in an extensive promotional campaign rolled out in June. The Greenery coordinates the desired contents of the weekly Vitapauze package in direct consultation with parents through a website. Vitapauze is linked to the food and encouragement programme ‘SchoolGruiten’ – a play and learn method to promote fruit and vegetable consumption among primary school children.

1.4 From controller to supervisor The Greenery has made substantial investments in its food safety policy over the years. This has enabled The Greenery to anticipate the rapidly changing and strongly divergent market requirements. This market-oriented policy was substantiated further in 2009. Together with various. supply chain partners efforts were undertaken in the area of sustainable growing methods. Product quality was the number one priority at all times. The Quality and Environment Department itself clearly detailed the processes involved in the new tariff and levies system. This resulted in heightened cost awareness and offered guidance on. efficiency and effectiveness in an area that is. becoming ever more complex. Despite the harmonisation of legislation at Europe an level, the trend towards diversifying food safety

Within the framework of a new tariff and levies system, in 2009 a thorough analysis was made of the costs involved in a stringent and progressive food safety policy. This not only resulted in more understanding but also provided more insight into the efforts required to serve a broad European customer portfolio. This information formed the basis for discussions with growers on the possibility of optimising the processes themselves. This lead to tailoring growing processes to customers’ wishes as well as to appointing a designated quality con troller for the growers. The mutual trust that has arisen will enable The Greenery to fulfil a different role in the future, developing into a supervisor and moving away from its role as a controller. In 2010 the purchase of fruit, vegetables and potato products is expected to cater more for consumers’ wishes. This means that retailers will provide more directions to

Entering into supply chain collaboration enables us to promote the sustainable cultivation of fruit and vegetables worldwide regulations continues unabated. Consumer focus on food safety and sustainability was incorporated into more stringent statutory requirements imposed by the government and into requirements exceed ing the statutory minimum imposed by retailers. However, the benefits that can be derived from using crop protection agents in cultivation are becoming even smaller. The Greenery has therefore joined forces in the wider supply chain with growers, suppliers, retailers and manufacturers of crop protection agents. An agreement was concluded with Bayer CropScience for international collaboration across different parts of the globe. Research projects were initiated and continued with Syngenta, BASF and Koppert Biological Systems. The collaboration with these different parties will help to create supply chain optimisation, shorten lines between growers, crop protection agent manufacturers and seed refiners. New projects will be started and the end customer will also be involved.

their suppliers in order to provide better informa tion to consumers. Monitoring compliance with the divergent customer requirements continues to be a priority. In this context The Greenery invests in systems and knowledge that allow the company to assume its leadership role. The award-winning Greenery Residue Management System (RMS) continues to be an important information source based on which The Greenery monitors activities. RMS also supports the selection of potential new suppliers, the identification of risk areas and the drawing up of a preventive policy for growers. This continues to be highly important since specifi cations exceeding the statutory minimum require great expertise and strong collaboration between growers and The Greenery.

The theme of sustainability gained more impor tance in 2009, not only in the market but also internally. At various sites The Greenery worked on a more economical energy policy. Water and elec tricity consumption is monitored and direction is given on how to reduce consumption. The environ mental impact of refrigeration systems is taken into account when they are purchased or used, thus making an active contribution to reducing CO2 emissions. The Greenery also promotes sustainable initiatives among its members / growers. Efforts in this area and the support of sustainable grower initiatives will be increased further in 2010. All corporate social responsibility efforts undertaken by The Greenery and its growers can be found in The Greenery’s sustainability report published annually on www.thegreenery.com 20

European Award for Cooperative Innovation In June The Greenery received the European Award for Cooperative Innovation in the Food Chain category in Brussels. Copa-Cogeca, the European umbrella organisation for agricultural and horticultural cooperatives, presented the award to the most innovative European cooperatives. The Greenery captured the award for its own unique Residue Management System and the innovative manner in which the entire supply chain works with various partners. In particular, the jury praised the exemplary function, strategic importance and versatility of the innovation. The Greenery conducts over 3,500 residue analyses annually on the fruit and vegetables it produces and trades and collects the results in the Residue Management System that now contains over 20,000 analysis results. The system enables the company to set up specific projects together with different supply chain partners, including retailers and manufacturers of crop protection agents, in order to reduce the use of these agents considerably.

1.5 Focus on corporate culture strengthens strategy implementation The Greenery has highlighted corporate culture as one its five principal strategic pillars. The focus on corporate culture brought about a significant improvement in the adaptability and responsiveness of the company. In 2010 corporate culture will continue to be an important area for attention when change occurs as a result of the implementation of the new cooperation model. The core competencies defined in 2008 and their. consistent application in personnel policy have ensured that business continuity and high quality are maintained. As a result, growers and retailers have improved the required operational performance. The Greenery’s corporate culture incorporates trans parency, loyalty, quality awareness, results orientation and common sense. The Greenery’s view is that corporate culture evolves from exemplary behaviour demonstrated by management and the integration of that behaviour into all activities. The Greenery’s corporate culture is founded on the concisely worded strategy ‘Success in fresh produce’. The core values of the strategy have been translated into measur able, objective and quantifiable competencies and functional skills. This has enabled management to provide better direction to employees in pursuing the strategy and has also resulted in improved personal development plans. A highly tangible instrument for measuring corpo rate culture is the employee satisfaction survey that The Greenery holds every two years, most recently in 2009. Eighty percent of our employees took part in the 2009 survey, which is a high response rate. The results are now being analysed but a preliminary conclusion was already drawn at year-end 2009: employee satisfaction is greater than two years ago and the average rating is higher than before. Another corporate culture barometer is the em ployee participation consultation. Works Council elections were held in 2009. As a result of a largescale campaign, 24 employees were eligible for

SOLID TEAM The Greenery’s workforce remained virtually stable in 2009. Larger volumes of produce were handled by fewer employees as a result of efficiency measures and the automation of production lines. The growth in employee numbers at Hollander Barendrecht ensured the overall workforce remained stable. At year-end 2008, 1,643 employees worked for The Greenery . and at year-end 2009 staff in active employment . numbered 1,645. The total workforce comprises . 1,794 people.

election to the 15 available places. On 21 October 530 employees voted, representing approximately 30 percent of the voters. This resulted in a new Works Council comprising seven Works Council members. Aad van Wensveen was elected Works Council Chairman. He, George Verlaan and René van de Velden will form the Executive Committee for the next four years.

All of The Greenery’s 180 managers were given a toolbox in 2009 providing support for management tasks and showing them how to take clear-cut action. The toolbox contained a DVD showing actors demonstrating practical examples of managing situations after escalation. Tools on paper covered 11 different subjects, such as entering and leaving employment, integrity at work and the company rules and regulations.

1.6 New cooperation model A milestone was achieved in 2009 when approval was received from the Members’ Council for the new cooperation model. The new model enables new forms of collaboration between growers, the Cooperative and the trading company. The trading company and the Cooperative have been positioned separately in the new model. The Cooperative’s strategy is aimed at providing added value to the individual grower members and enabling supply chain bundling. The trading company will pursue its current strategy. A proposal for the new cooperation model was pre sented to the Management Board of Coöperatie The Greenery U.A. during the Board meeting held on 25 August 2009. The proposal was presented to growers and the media in early September. The model reflects the response to a number of new develop ments that have taken place on the part of custom ers as well as growers in the market where the Cooperative operates. There is an increasing desire among customers to work more closely in the supply chain, achieve higher quality and ensure greater food safety. Growers want a different framework in which to conduct their business as a result of their professionalisation and increased scale. This incor porates key elements such as personal service, stronger ties with the market and increased involvement and influence on commercial policy. The model represents a further step in the initia tives developed earlier. The Greenery has already taken a number of measures in this context. Over the past years, the number of interfaces between growers and customers has increased considerably, the Sourcing Department has a product-oriented structure and the new tariff and levies system was introduced. The new cooperation model represents a logical next step in the process. This will create more flexibility and increased focus for the trading company while growers will gain more freedom of choice in the way in which they work with the trading company and how they market their produce. The freedom of choice relating to the form of col laboration with the trading company is reflected in

two models, i.e. through a partnering relationship or a transactional relationship. The partnering rela tionship or ‘P’ model means a closer relationship with The Greenery trading company, the aim of which is to provide sustainable added value and closer collaboration with supply chain retailers. Growers work with the trading company to achieve market-oriented sales of their produce. The transactional relationship or ‘T’ model involves sales of growers’ produce to The Greenery trading company and/or to wholesalers and exporters in The Netherlands. Transactional growers can indi vidually purchase services such as internal logistics, external transport and packaging. Sales of their produce are conducted through the Cooperative’s sales structure. The Cooperative has disposal of the all the produce grown by its members and is responsible for sales policy. The Cooperative remains the owner of The Greenery trading company but will have a distinct position in the new cooperation model. The trading company will operate under the motto ‘collaborative power driven by individual strength’ and aims to offer market-oriented growers and grower associations access to the market. Its separate positioning will furthermore enable supply chain bundling. From discussions held with other grower associations it appeared that the alliance between the trading com pany and the Cooperative often created a barrier. The trading company’s strategy aims to manage costs as well as create added value. This strategy will continue in full after the new cooperation model has been implemented. The trading com pany will enter into a stronger and closer form of cooperation with the growers in the ‘P’ model’ and will continue to have access to new flows of produce from growers who choose the ‘T’ model. In early February 2010 the members announced their choice for a partnering or a transactional relationship. Eighty-six percent chose the ‘P’ model and 14% of the members the ‘T’ model. This will enable The Greenery to strengthen its role as supply chain orchestrator and as the source of quality produce.

1.7 Stepping stone to 2010 The individualisation trend among large producers and producer associations has encouraged The Greenery to introduce the individual grower price and the ‘cost generator-cost bearer principle’.. A new step in this process was taken as a result of the increasing pressure seen on prices in 2009. The trend for more distinct collaboration between growers and retailers is set to continue unabated. This will not only generate a sustainable result but will also simplify market-oriented business activi ties. Clear agreements have been made between retailers and growers on quality, availability and sustainability. This also meets the wishes of consumers, who are demanding more transparency on the origin of a product and how it is grown. Combined with the focus on climate issues, this will bring about increased consumer interest in regionally grown produce. Demand for this type of produce is expected to continue. This development will create new challenges for organisations such as The Greenery. Customer demand for organising large, uniform flows of products must be fulfilled on the one hand, while on the other, flexibility will also be needed to meet differing regional and local demands. This will primarily form a logistics challenge, which will need careful attention. Market conditions characterised by persistent pressure on margins and pricing require initiatives such as shorter supply chains and cost reduction initiatives in order to secure returns for growers and businesses. The prospects, however, are not entirely positive. Various new production areas inside and outside Europe have undergone further professionalisation. Producers in new production areas, such as North Africa and Eastern Europe, have gained access to the European market. More over the acreage of certain product groups has again been expanded in The Netherlands. Accord ing to Statistics Netherlands, in 2009 the acreage of glasshouse vegetables was expanded by 180 hectares. Without a substantial increase in consumption, this will inevitably create pressure on prices. If the pricing situation does not improve,

rationalisation is bound to occur among growers. This is a harsh reality which must be taken into account. At the same time, it is essential to organise and orchestrate large flows of products and volumes. The consolidation among wholesalers and the industry and especially in the retail market will result in the rise of large purchasing organisations that require partner organisations who can ensure a continuous flow of high-quality and flexible supplies. If the Dutch horticultural industry is to retain its leadership role in Europe, consolidation will also have to occur here. A first step in this direction was taken in 2009. Talks between the organisations in preparation of a possible APO have brought the parties closer together. However, a next step must be taken: mergers or joint ventures of producer organisations will safeguard sustainable reinforcement of The Netherlands’ position as a production country. The Greenery will play its part in this by being an attractive partner for both customers and growers, by facilitating supply chain bundling and by fully implementing its strategy as a trading company. The year 2010 will also spotlight this strategy; operational excellence and providing added value remain the priority. The Greenery will reinforce its business by investing in new sales channels and countries offering growth potential. It will tailor its services even more closely to the specific wishes of its customers. At the same time, a great deal of effort will be placed on organising the food chain in a cost efficient manner. In its role as the supply chain orchestrator, The Greenery will continue to provide direct access to the source of high-quality fresh fruit and vegetables. The Greenery expects to see a slight decline in the workforce in 2010. Efficiency investments will be made using the available financial resources.

Part 2

eports of the R Administrative Bodies 26

2.1 Profile The Greenery is a leading global fruit and vegetable company. We supply a full range of fresh fruit and vegetables to our customers all year round,. including supermarket chains, retailers, caterers and the food processing industry. We regard high quality and universal professionalism as the. focus of our business. However, we aspire to take a further step. We aim to boost the market through industry leadership using our expertise and entrepreneurial skills. We are driven by the energy that comes from healthy ideas, the courage to take the road less travelled and the determination of our employees.

temporarily allocated to different parties or parts of the organisation. The five values are the principles of our business which ensure that The Greenery remains a distinctive, authentic and distinguishable business at all times. • High-quality: Quality is a basic precondition for the way we work with natural produce. We con tinuously aim to ensure that our professionalism is reflected in the quality of the products and services we offer. This is not limited to product quality alone. Food safety, consistency and uniform processes are equally important.

The Greenery believes in creating success for itself and its partners through healthy ideas Our vision Together with our employees, growers and cus tomers, The Greenery is working to build a healthy business. Collaboration is central to our approach since we believe that this can help us achieve a healthy business in multiple respects. This includes the industry in which we operate and the products themselves. ‘Healthy’ also applies to food safety, the health of our environment and that of our employees. Finally, we also place a great deal of importance on financial health.

Our mission Our mission is ‘Success in fresh produce’. The Greenery believes in creating success for itself and its part ners through healthy ideas. These ideas are always based on a genuine understanding of consumer needs and the supply chain. We will work to boost the entire supply chain, ensuring that our organisa tion and our partners continue to lead the industry.

Our values The Greenery conducts its business based on a number of core values which serve as a touchstone for our day-to-day activities. These five core values should be reflected in everything we do at all times. They are not interchangeable and cannot be

• Entrepreneurial: The Greenery has a tradition to uphold as an innovative entrepreneurial organisation. We take the initiative and have the courage to take the road less travelled. Our market-oriented and cost-effective approach helps make the difference in today’s market place. • Well-considered: We take a well-considered approach to all our activities. Working in consulta tion with our colleagues and customers, we take decisions that will ensure sustainable coopera tion. • Fresh: We believe in the power of an open organisation with fresh, new ideas. An organisa tion that generates energy through its vibrancy and inspirational power. This is what we stand for and what we have committed to undertake. • Trendsetting: The Greenery stimulates the market in which it operates. We lead the industry by continually introducing new products, services and concepts based on genuine insight into consumer needs.

2.2 Corporate Governance Coöperatie The Greenery U.A. (‘the Cooperative’) conducts its activities in a separate company with limited liability under the name The Greenery B.V. (‘the company’). The management and supervisory structure of the two legal entities is described below.

Members, divisions and Members’ Council The Cooperative has 1006 members, all of whom are fruit, vegetable and mushroom growers. Its members are divided into four regional divisions each having their own divisional management that is elected during divisional meetings attended by the division’s members. The divisional manage ment members jointly form the Members’ Council.

The Members’ Council handles various matters, such as the adoption of the Cooperative’s financial statements, granting the Cooperative’s Manage ment Board discharge from liability in respect of the performance of its duties, amendments to the Cooperative’s Articles of Association and regula tions, and appointing members to the Cooperative’s Management Board. In addition, approval from the Member’s Council is required for passing Manage ment Board resolutions relating to exercising voting rights attached to the shares held by the Cooperative in the capital of The Greenery B.V. to the extent this concerns the adoption of the financial statements and approval of the company’s strategic business plan and budget plan.

Management Board of the Cooperative The Members’ Council appoints the Cooperative’s Management Board, which comprises members of the Cooperative. The composition of the Manage ment Board reflects the best possible mix of repre sentatives from the Cooperative’s membership based on regions and product groups. The Board is responsible for serving the interests of the Cooperative’s members and the business conducted by the Cooperative through the company and its subsidiaries.

General Meeting of Shareholders of the company The company has issued Class A shares and cumulative Class B preference shares. All Class A and B shares are held by the Cooperative, which means that the Cooperative has complete control at the General Meeting of Shareholders of the company. During a General Meeting of Shareholders, the Management Board exercises the voting rights attached to the shares on behalf of the Cooperative. The Cooperative has issued depositary receipts for cumulative Class B preference shares without the cooperation of the company. The Cooperative serves as a trust office for these depositary receipts. The Cooperative’s Management Board also acts as the trust office’s Management Board. Holders of depositary receipts are not vested with the rights accorded by law to holders of depositary receipts that have been issued with the cooperation of a company. Each year prior to the company’s annual meeting, acting in its capacity as trust office the Cooperative convenes a meeting of depositary receipt holders. During this meeting, the depositary receipt holders are informed about the resolutions to be passed relating to the adoption of the company’s financial statements as well as profit appropriation. In addition, the trust office renders account of its conduct during the financial year. In the company’s General Meeting, matters handled include the adoption of the company’s financial statements and granting the company’s management discharge from liability in respect of the performance of its duties. Furthermore, General Meeting approval is required for certain resolutions adopted by the company’s General Management as described in the company’s Articles of Associa tion, for example the adoption of the strategic business plan and budget plan.

General Management of the company Under the Articles of Association the company’s General Management, which currently comprises a general manager and a finance director, is respon sible for managing the company. This includes formulating strategy and policy as well as defining and achieving the company’s objectives. General Management is accountable to the Supervisory Board and to the General Meeting of Shareholders. The two General Management members have been appointed by the Supervisory Board for an indefinite period of time. The Supervisory Board determines the remuneration and other terms of employment for the General Management members in accordance with the remuneration policy approved by the General Meeting of Shareholders.

Supervisory Board of the company The Supervisory Board supervises General Manage ment policy as well as the general developments in the company and its business. The company is subject to a statutory two-tier regime, which means that the Supervisory Board has been accorded the powers specified in Book 2, Title 5, Part 6 of the Dutch Civil Code, including the appointment of General Management and the approval of General Management resolutions defined by law. Further more, certain General Management resolutions defined in the Articles of Association require prior Supervisory Board approval. At year-end 2009, the Supervisory Board comprised ten members. These are the members of the Coop erative’s Management Board and three Supervisory Board members who are not members of the Cooperative. The company’s Articles of Association incorporate a derogation from law of the Supervisory Board appointments procedure for two-tier board companies in that the Supervisory Board is appointed by cooptation. A covenant was concluded with the Works Council, in which agreements were made on the composition of the Supervisory Board, the rights of recommendation of the Works Council and the appointment of Supervisory Board

members. The Supervisory Board established a Selection and an Audit Committee from among its members.

Corporate Governance Code Although the Dutch Corporate Governance Code does not directly apply to The Greenery, the company endorses the Code’s basic principles and does indeed act in the spirit of the Code. However, the basic principle at all times remains the private limited and cooperative nature of its business, with the associated influence of its members.

Bestuursorganen in 2009 Coöperatie The Greenery U.A. Management Board Th.L.J. Ammerlaan, Chairman P.W.J.M. van Asseldonk, Vice Chairman B.J. Feijtel J.A.M. van der Harg A.W.G.M. Hop P.S.C. Oostveen J.C.M. van der Voort The Greenery B.V. Supervisory Board P.J.J.M. Swinkels, Chairman Th.L.J. Ammerlaan, Vice Chairman P.W.J.M. van Asseldonk G.J. Beijer B.J. Feijtel (effective 11 February 2009) J.A.M. van der Harg A.W.G.M. Hop B.J. de Lange P.S.C. Oostveen J.C.M. van der Voort The Greenery B.V. General Management P.R.J. Smits, General Manager A.W. Knol, Finance Director

2.3 Supervisory board report Report, including the financial statements for 2009 consisting of the balance sheet as at 31 December 2009, the profit and loss account for the 2009 financial year and the relevant notes. The financial statements were audited by Deloitte Accountants B.V., who issued an unqualified audit opinion. The Supervisory Board members and General Management signed the financial statements by way of endorsing the Annual Report incorporating the financial statements. The Supervisory Board also granted its approval to the profit appropriation proposal presented by General Management. The financial statements were submitted to the General Meeting of Shareholders for consideration and adoption. The Supervisory Board proposed that the General Meeting of Shareholders adopt the financial statements, agree to the intended appropriation of profit and grant General Management discharge from liability in respect of the policy conducted over the financial year as well as the Supervisory Board for the supervision it has carried out in this regard.

Supervision and advice The Supervisory Board met on seven occasions in the 2009 financial year. In addition to the general course of events within the company, commercial developments and financial results, these meetings addressed, among other things, the remuneration policy, various invest ments, the commercial organisation and the new coop eration model. A number of meetings were held at the offices of The Greenery’s branches, enabling the Supervisory Board to be shown around and updated on developments at the relevant location. Representatives from the Supervisory Board also attended a number of consultative meetings with the Works Council. The Supervisory Board Audit Committee, comprising Messrs B.J. de Lange (Chairman), P.J.J.M. Swinkels, TH.L.J. Ammerlaan and J.A.M. van der Harg, met three times in the review year in preparation of the adoption of resolutions by the Supervisory Board relating to the company’s Annual Report and financial statements, as well as the auditing thereof. Furthermore the Audit

Committee discussed compliance with the manage ment letter, audit plan, investment plan, investment procedure, the new cooperation model and the implementation of an ERP system. The Supervisory Board Selection Committee comprises Messrs P.J.J.M. Swinkels (Chairman up to 1 January 2010), G.J. Beijer (Chairman effective 1 January 2010), Th.L.J. Ammerlaan, Vice Chairman and P.W.J.M. van Asseldonk. The Selection Committee met on three occasions during the financial year in preparation of the adoption of resolutions by the Supervisory Board relating to issues including the bonus objectives for 2009, the performance and remuneration of General Management, the reappointment of Supervisory Board members and the remuneration policy for senior management.

Appointments and retirements On 11 February 2009 Mr B.J. Feijtel, member of the Cooperative’s Management Board was appointed a Supervisory Board member of the company. Messrs A.W.G.M. Hop and J.C.M. van der Voort were scheduled for retirement and eligible for reappointment in 2009, in accordance with the Supervisory Board’s retirement schedule. They were both reappointed for a new four-year term on 1 April 2009. The Supervisory Board would like to thank General Management, Management and all The Greenery’s employees for their efforts throughout the review year.

Barendrecht, 9 March 2010

The Greenery B.V. Supervisory Board

2.4 R eport of the cooperative’s management board Average member turnover reflected a slight. increase compared with the previous year despite a small drop in member numbers. On 31 December 2009, 1,471 natural persons and legal entities were members of the Cooperative. These members represent 1,006 businesses. The Cooperative anticipated market changes on the part of growers and customers by developing a new cooperation model, participating in. Producer Organisation Associations (APOs) and investigating merger opportunities. The number of divisions within the Cooperative was reduced from seven to four and the structure of the Youth Council adjusted in accordance with the new. situation. The new tariff system again formed the focus of 2009.

New cooperation model The Management Board developed a new coopera tion model in conjunction with General Management. The Members’ Council held various interim meet ings throughout the development process and the divisions received information in divisional meetings and the usual publications. The Members’ Council approved the new cooperation model for The Greenery on 18 December 2009. The approval marked the start of the implementation phase. The Cooperative remains the owner of The Greenery trading company but will have a differentiated positioning in the new cooperation model. The trading company will operate under the motto ‘collaborative power driven by individual strength’. Its objective is to offer market-oriented growers

The Cooperative anticipated market changes on the part of growers and customers by developing a new cooperation model Tariffs and levies The new tariff and levies system took effect early in the year. Under this system members pay tariffs based on the ‘cost generator-cost bearer’ principle. This system has made supply chain costs more transparent. The Management Board has noted that the basic principles of the new system have been widely accepted and that cost awareness among growers and within The Greenery has increased. In the financial year the Management Board focused on problem areas in the new system and made adjustments, where necessary.

and grower associations access to the market by the qualitative bundling of supply chains while leaving room for individual entrepreneurship.

Exploring collaborative partnership opportunities The Cooperative and the company have this year also taken action on supply chain bundling initiatives, for instance establishing APOs. The Management Board regards an APO as a stepping stone for a more structural form of supply chain bundling: a possible merger of different cooperatives.

Reorganisation of Greenery departments

Annual Report and financial statements

In 2009 the number of divisions at The Greenery was reduced from seven to four. The resolution to that effect was approved by the Members’ Council at year-end 2008 and implemented in 2009. The Management Board applied the following criteria to the reorganisation: the divisions should be geographically linked and the distances within a division should be as short as possible; the divisions were merged in their entirety and the number of members’ voting rights in the Members’ Council has remained unchanged to the extent possible. Furthermore, pursuant to the Articles of Association no division may hold more than 32 percent of the votes in the Members’ Council. The departments are North (Northern Netherlands and the Province of North Holland), Central (Central Netherlands and South East Netherlands), South (South West Netherlands and West and Central Brabant) and Westland.

The Cooperative’s Annual Report and consolidated financial statements incorporating The Greenery B.V.’s financial statements were prepared under the responsibility of the Management Board. The financial statements were audited by Deloitte Accountants B.V., who issued an unqualified audit opinion. The financial statements will be submitted to the Members’ Council for consideration and adoption. Our proposal to the Members’ Council is to adopt the financial statements and grant the Management Board discharge from liability in respect of the policy it has conducted during the review year.

Appointments and retirements Messrs A.W.G.M. Hop and J.C.M. van der Voort were reappointed as Management Board members in the Members’ Council meeting held on 27 March 2009. Messrs J.C. van der Veeken and L.H.M. Zwinkels were re-elected as members of the Disputes Committee at the same meeting. During the Mem bers’ Council meeting held on 10 September 2009, Messrs S. Appel and K. de Hamer were re-elected to the Disputes Committee.

Barendrecht, 30 March 2010

Coöperatie The Greenery U.A. Management Board

Part 3

Financial Statements 34

1 CONSOLIDATED BALANCE SHEET AS AT 31 DECEMBER 2009 . (BEFORE PROFIT APPROPRIATION) Assets

Note

2009

2008

Fixed assets Intangible fixed assets

6.1

20,261

22,150

Tangible fixed assets

6.2

278,644

280,560

Financial fixed assets

6.3

23,216

19,214

322,121

321,924

Current assets Stocks

6.4

23,427

27,509

Debtors

6.5

161,076

158,058

Cash at bank and in hand

1,643

23,114

186,146

208,681

508,267

530,605

TOTAL ASSETS

(in thousands of euros)

Liabilities

Note

Group equity

6.6

Equity

2009

2008

35 62,602

54,566

Minority shares in group equity

(186)

(60)

62,416

54,506

6.8

7,409

7,975

Product funds Provisions

6.9

113,629

124,737

Long-term liabilities

6.10

104,128

94,931

Current liabilities

6.11

220,685

248,456

445,851

476,099

508,267

530,605

6.7

201,329

205,473

Capital base as a percentage of total assets

39.6%

38.7%

TOTAL LIABILITIES Capital base

(in thousands of euros)

Please see the notes to the consolidated balance sheet on page 47 for the composition of the capital base.

2 CONSOLIDATED PROFIT AND LOSS ACCOUNT FOR 2009

Note

2009

2008

7.1

1,626,829

1,813,965

Total operating income

Less: commission on product sales

(478,068)

(505,618)

Net turnover

1,148,761

1,308,347

Cost of goods for resale and work contracted out

917,897

1,087,640

Wages and salaries

77,417

73,409

Social security charges

10,753

10,327

Pension and early retirement costs

6.9

7,359

8,320

Depreciation and amortisation

27,721

24,238

Other operating costs

7.2

93,759

94,254

Total operating expenses

1,134,906

1,298,188

Operating result

13,855

10,159

Financial income and expenses

7.3

(9,358)

(8,041)

Profit on ordinary activities before taxation

4,497

2,118

Tax on profit on ordinary activities

7.5

(1,452)

2,707

Profit from participating interests

7.4

4,311

3,794

Group profit after taxation

7,356

8,619

Minority shares in group profit

Net profit

7,388

8,697 (in thousands of euros)

3 CONSOLIDATED CASH FLOW STATEMENT FOR 2009

2009

2008

Operating activities Operating result

13,855

10,159

Depreciation and amortisation

27,721

24,238

Impairment of tangible fixed assets

(7,656)

(7,109)

(98)

(3,819)

(32,260)

20,403

Movement in provisions Movement in working capital

Cash flow from business operations

1,562

43,872

Interest (paid or) received

(4,876)

(3,802)

Corporate income tax (paid or) received

(4,047)

(204)

Cash flow from operating activities

(7,361)

39,866

Investing activities Additions to intangible fixed assets

(150)

Additions to tangible fixed assets

(18,123)

(35,286)

Disposals of tangible fixed assets

230

12,080

Loans granted

(456)

454

Dividends received

1,622

Acquisition and disposal of participating interests

624

Repayment of loans granted

Cash flow from investing activities

(17,439)

(21,545)

Cash flow from operating and investing activities

(24,800)

18,321

Financing activities Movement in bank loans and other loans

16,440

4,484

Movement in membersâ&#x20AC;&#x2122; loans and liquidity levy

(7,471)

(2,396)

Movement in product funds

(2,956)

(4,066)

(293)

(4,791)

Repurchase of depositary receipts

Cash flow from financing activities

5,720

(6,769)

Net cash flow

(19,080)

11,552

Exchange and currency translation differences in cash

(2,391)

(2,074).

at bank and in hand

Movement in cash at bank and in hand

(21,471)

9,478 (in thousands of euros)

4 STATEMENT OF CHANGES IN EQUITY FOR 2009

2009

2008

Consolidated net profit after taxation allocatable to the legal entity

7,388

8,697

Repurchase of depositary receipts

(5,084)

Revaluation of minority share

140

Revaluation of property

1,509

Exchange and currency translation differences on foreign participating interests

508

(1,734)

Total changes in equity

8,036

3,395 (in thousands of euros)

5 GENERAL NOTES INTRODUCTION Coรถperatie The Greenery U.A. (hereafter referred to as the Cooperative) was incorporated on 25 October 1996 and has its registered office in The Hague, the Netherlands. It is the sole shareholder of The Greenery B.V.

Amounts included in the notes are in thousands of euros, unless stated otherwise.

Principal activities The Cooperative holds all the shares in The Greenery B.V. The Greenery is a leading international company engaged in obtaining a full range of fruit, vegetables and mushrooms from around the world and supplying these fresh every day to its customers all year round. Its customers are mainly wholesalers and supermarket chains in Europe and North America. The company also supplies caterers and industry. The Greenery B.V. has branches in eight countries and its policy and approach focus on market orientation, food safety, sustainability, innovation and logistics efficiency.

Other events The Netherlands Competition Authority (NMa) is investigating breaches of the Competitive Trading Act by businesses engaged in selling fruit and vegetables. It visited The Greenery in this context in July 2009. The Greenery assisted in the investigation. To date the NMa has not prepared a report of the visit. A number of non-active companies were dissolved during 2009.

Profit and loss account The company profit and loss account has been drawn up in accordance with the provisions of Section 402 of Book 2 of the Dutch Civil Code.

Basis of consolidation The consolidated financial statements of the Cooperative include the financial data of the group companies that the Cooperative controls. The consolidated financial statements have been prepared in accordance with the accounting policies of the Cooperative. The financial data of the Cooperative are included in the consolidated financial statements and, in accordÂ ance with Section 402 of Book 2 of the Dutch Civil Code, the company profit and loss account has therefore been drawn up in abridged form. The financial data of group companies and other legal entities and companies included in the consolidation are consolidated in full. Intercompany balances and transactions have been eliminated. Minority interests in the equity and results of group companies are disclosed separately in the consolidated financial statements. The results of newly acquired group companies and other legal entities and companies included in the consolidation are consolidated from the date of acquisition. The results of disposed participating interests are consolidated to the date they left the group. A list of the names and registered offices of group companies and non-consolidated participating interests has been filed at the Chamber of Commerce in Rotterdam. An abridged list of group companies is included on page 61.

Basis of preparation of the consolidated financial statements The consolidated financial statements have been prepared in accordance with the provisions of Part 9 of Book 2 of the Dutch Civil Code. Unless stated otherwise, the financial statements have been prepared under the historical cost convention. Assets and liabilities are carried at face value unless stated otherwise in the notes on specific balance sheet items. Income and expenses are allocated to the year to which they relate. Profits are recognised only if realised at the balance sheet date. Losses originating before the end of the financial year are recognised if they are known before the financial statements are prepared.

Financial instruments Financial instruments refer to both primary financial instruments such as debtors and liabilities as well as financial derivatives. Please refer to the treatment per balance sheet item for the accounting policies relating to the primary financial instruments. The Cooperativeâ&#x20AC;&#x2122;s policy is to limit risks to an acceptable level where possible, including managing credit, liquidity and cash flow risks. Much of the credit risk is insured with a credit insurer. Foreign exchange positions are largely covered by forward exchange transactions. Some foreign exchange positions are also hedged using option contracts. Interest-rate derivatives are used to hedge interest risks.

Hedging instruments at cost Financial instruments that serve to hedge risks and whose underlying securities are not publicly listed, or for which no hedge accounting is applied, are stated at current value. Revaluation results stated at fair value at the balance sheet date are taken directly to the profit and loss account. The Cooperative applies hedge accounting based on individual documentation for financial instruments having a specific individual hedge relationship. Generic documentation is applied to financial instruments having a non-specific hedge relationship. The Cooperative documents the way in which hedge relationships match the objectives of risk management, hedging strategy and expectations of the effectiveness of the hedge. General information on cost hedge accounting The effective portion of financial derivatives allocated to cost hedge accounting is valued at cost and the ineffective portion at fair value. The fair value changes on the ineffective portion are taken directly to the profit and loss account. Cost hedge accounting for hedging monetary, foreign currency balance sheet items The foreign currency components of both hedged balance sheet items and forward exchange contracts that function as hedging instruments are stated at the exchange rate effective on the balance sheet date.

Cost hedge accounting for hedging foreign currency futures transactions The foreign currency component of forward exchange contracts that function as a hedging instrument for hedging futures transactions are stated at cost as long as the hedge position has not yet been recognised in the balance sheet. Unrealised losses on financial instruments that do not serve to hedge risks or are intended to hedge future cash flows are taken directly to the profit and loss account.

Principles for foreign currency translation Debtors, liabilities and commitments in foreign currencies are translated at the exchange rates ruling at the balance sheet date. The exchange differences resulting from translation at the balance sheet date are taken to the balance sheet and profit and loss account, taking account of hedge transactions. Transactions in foreign currencies during the period under review are accounted for at the exchange rate at which they were settled. Foreign group companies and non-consolidated participating interests qualify as autonomous foreign entities. The financial statements of the foreign entities are translated at the exchange rate at the balance sheet date for items in the balance sheet and at the average rate for items in the profit and loss account. Translation gains and losses are taken directly to group equity.

ACCOUNTING PRINCIPLES Intangible fixed assets Since 1999, goodwill arising on the purchase of shares and the acquisition of business activities has been capitalised. Assets, provisions and liabilities at the date of acquisition are stated at fair value. The goodwill created is carried at the amount of the costs incurred, less accumulated amortisation and, if applicable, impairment. Amortisation is based on the expected useful life (20 years). Goodwill is tested annually for impairment.

Tangible fixed assets - Land and buildings Land and buildings are carried at current value. Land and buildings in use by the company on a long-term basis are carried at replacement value. Land and buildings held with the intention of being sold in the foreseeable future and not replaced are carried at estimated realisable value. EU grants received are deducted from this value. Replacement value and realisable value, which are based on appraisals carried out by external experts, are updated on the basis of market information, specific index figures and market data for each location. Value adjustments in the financial year are taken to the revaluation reserve, net of deferred taxes. Depreciation for buildings is based on the expected useful life of the building. Depreciation is not applied to land. - Other tangible fixed assets Other tangible fixed assets are carried at the cost of acquisition or production, net of straight-line depreciation determined for each category of assets based on their expected useful lives and allowing for any residual value. Assets are depreciated from the date they are taken into use. EU grants received are deducted from this value.

Financial fixed assets Participating interests where no significant influence is exercised on commercial and financial policy are carried at net asset value. Participating interests with a negative net asset value are valued at nil. Net asset value is determined in accordance with the Cooperativeâ&#x20AC;&#x2122;s accounting policies. Where the company has either wholly or partially guaranteed debts payable by the relevant participating interest, a provision has been formed, which is primarily charged to receivables from this participating interest and the remainder to the provisions, in the amount of the remaining share in the losses incurred by the participating interest or of the expected payments to be made by the company on behalf of these participating interests. Amounts receivable from, and loans to, participating interests and other debtors are carried at face value, net of any allowances considered necessary. Securities included in financial fixed assets are carried at market value at the balance sheet date.

Stocks Stocks are carried at the lower of cost and market value, net of provisions for obsolescence where necessary. Stocks of reusable packaging are carried at the refundable amount, unless held on consignment.

Debtors Debtors are carried at face value, net of provisions for doubtful debts where necessary. These provisions are determined based on an individual assessment of the debtors.

Cash at bank and in hand Cash at bank and in hand is carried at face value and is at the companyâ&#x20AC;&#x2122;s free disposal.

Product funds Product funds consist of levies raised on growers. Product funds are carried at face value and may only be used to defray the cost of commercial activities such as promotions, product research and care systems, after consultation with growers’ representatives.

Provisions Pension provisions The Cooperative and its subsidiaries have several pension plans. No provision is formed under Dutch Guideline 271, Employee Benefits, for the industry-wide pension fund of Stichting Bedrijfspensioenfonds voor de Agrarische en Voedselvoorzieningshandel, Pensioenfonds Vervoer or the Defined Contribution Plan. The pension plan managed by Stichting Bedrijfspensioenfonds voor de Agrarische en Voedselvoorziening shandel and Pensioenfonds Vervoer is a defined benefit plan. Industry-wide pension funds in the Nether lands are not generally in a position to supply the information that would allow the company to make the calculation required under Guideline 271. Consequently, the employer’s contributions paid to the fund are treated as defined contributions in the profit and loss account. - Defined contribution pension plans Liabilities with respect to contributions to defined contribution pensions and related plans are recognised as an expense in the profit and loss account in the period to which they relate.

- Defined benefit pension plans The liabilities for defined benefits are calculated separately for each pension plan at the balance sheet date. The calculation is based on the projected unit credit actuarial method. The fair value of the fund assets and unamortised actuarial losses are deducted from the calculated liability. The discount rate is the yield at the balance sheet date on good quality corporate bonds whose term to maturity is approximately equal to the term of the group’s liabilities. If the calculation results in a debtor for the group, the asset is recognised up to the net amount of unamortised actuarial losses and the discounted value of future refunds or lower future pension contributions. - Other long-term employee compensation The liability for other deferred employee compensation (early retirement and long-service awards) is calculated in the same way as for defined-benefit pension entitlements. Actuarial gains and losses are recognised in the profit and loss account.

Deferred tax A provision is formed for future tax liabilities resulting from timing differences between the valuation of assets and liabilities for financial reporting and for tax purposes. The provision is carried at its non-discounted value on the basis of the ruling tax rate, with the exception of land in use by the company on a long-term basis, to which a rate of 20% applies.

Other provisions Other provisions are carried at their non-discounted value.

INCOME AND EXPENSES In accordance with Section 362(4) of Book 2 of the Dutch Civil Code, the Annual Accounts Formats Decree has been departed from in order to provide better insight into operations in the profit and loss account. Net turnover has been broken down into ‘Total operating income’ and ‘Commission on product sales’.

Net turnover Net turnover represents the income from the supply of goods and services to third parties, net of VAT and discounts. Net turnover also includes the commission on product sales. Total operating income comprises net turnover plus the cost of product sales from commission business activities and the sales of member products marketed by the group. Operating subsidies are recognised in the profit and loss account in the year in which the subsidised expenditure was incurred.

Expenses Expenses are determined in accordance with the above accounting policies and allocated to the reporting year to which they relate.

Tax Corporate income tax is computed on the net profit or loss at the tax rate ruling for the year, taking account of permanent differences for computing the result for financial reporting and tax purposes. Deferred tax assets are only recognised to the extent that they are likely to be realised.

Profit from participating interests The Cooperative’s share in the results of participating interests is recognised where significant influence is exercised on commercial and financial policy.

CASH FLOW STATEMENT The cash flow statement has been prepared using the indirect method. In general, the cash flow statement reflects the movements in the consolidated balance sheet, with separate presentation under cash flow from investing activities in the case of the acquisition or sale of consolidated participating interests, of the acquired net asset value, less cash at bank in hand, and increased by any goodwill paid. Exchange rate movements are eliminated from balance sheet movements, as they do not represent cash flows. Partly for the above two reasons, the movements in the cash flow statement cannot always be directly derived from the movements in the related balance sheet items. Cash flows in foreign currency are translated at an average exchange rate. Exchange differences on cash are recognised separately in the cash flow statement. Profits tax and interest are stated under cash flow from operating activities. Dividends received are stated under cash flow from investing activities.

6 NOTES TO THE CONSOLIDATED BALANCE SHEET 6.1 Intangible fixed assets Goodwill

2009

Net book value as at 1 January

22,150

2008 24,036

Adjustment for capitalised goodwill

(26)

(23)

Amortisation

(1,863)

Net book value as at 31 December

20,261

22,150

Accumulated cost

36,671

36,697

Accumulated cost and other impairments

(16,410)

(14,547)

Net book value as at 31 December

20,261

22,150

(in thousands of euros)

In 2009 and 2008 an adjustment was made to the goodwill capitalised in 2006.

Vehicles Other fixed assets Tangible fixed assets on order Assets not in operation

Total

(81)

8,731

2,507

(146)

100

7,610

11,936 (11,154)

Depreciation rate

12,460

26,669

Net book value at 31 December2009

4,590

Other movements

Depreciation

(7,175)

219,304

Transfers

Revaluation

Machinery and equipment

Disposals

Buildings and land

Additions

Net book value at 1 January 2009

6.2 Tangible fixed assets

3,297

220,798

0â&#x20AC;&#x201C;3

(9,175)

3,847

42,451

(3,325)

833

7,579

5,512

1,702

(3)

372

(2,205)

155

21,302

2,057

(21,139)

(100)

2,120

5,533 20 - 33

163

280,560 23,316 (7,405)

0 (25,859) 8,032 278,644 (in thousands of euros)

The assessment of current value during 2009 did not result in revaluation. The additions of EUR 23.3 million (2008: EUR 48.3 million) are stated net of EU grants of EUR 16.5 million (2008: EUR 17.9 million). The book value as at 31 December 2009 includes EUR 41.0 million relating to capital expenditure at the cultivation companies of members of the Cooperative, EUR 15.2 million of which was invested in 2009. The release of EU grants received is recognised as other movements.

Buildings and land Machinery and equipment

Net book value at 31 December2009

Accumulated depreciation

Cost

Accumulated revaluation

Cost, accumulated revaluation, accumulated depreciation and net book values as at 31 December 2009 were as follows:

222,492

100,951

(102,645)

220,798

72,357

(29,906)

42,451

Vehicles

23,013

(15,434)

7,579

Other fixed assets

24,746

(19,213)

5,533

2,485

(365)

2,120

163

345,256

100,951

(167,563)

278,644

Fixed assets on order Assets not in operation

Total

(in thousands of euros)

The accumulated unrealised revaluation amounted to EUR 100,951 as at 31 December 2009 (2008: EUR 106,188). Deferred tax has been recognised on this amount.

6.3 Financial fixed assets

2009

Non-consolidated participating interests

20,384

15,928

Amounts receivable from participating interests

2,810

3,263

Other long-term debtors

23,216

19,214

Total

2008

(in thousands of euros)

2009

2008

15,928

14,372

Non-consolidated participating interests Net asset value at 1 January

Disposals

(624)

Share in result

4,316

3,794

Dividends received

(1,622)

Other movements

140

Net asset value as at 31 December

20,384

15,928

3,263

2,807

Loans granted

456

Repayment of loans

(453)

Net book value as at 31 December

2,810

3,263

Amounts receivable from participating interests Net book value as at 1 January

Other long-term debtors

Net book value as at 1 January

Repayment of loans

(1)

(21)

Net book value as at 31 December

(in thousands of euros)

6.4 Stocks

2009

2008

Packaging

9,908

12,071

Goods for resale

13,519

15,438

Total

23,427

27,509 (in thousands of euros)

6.5 Debtors

2009

2008

Trade debtors

113,172

125,727

EU grants

14,597

8,519

Other debtors

12,749

15,534

Prepayments and accrued income

20,558

8,278

Total debtors

161,076

158,058 (in thousands of euros)

6.6 Group equity Please see note 10.2 to the company balance sheet on page 59 for a breakdown of shareholdersâ&#x20AC;&#x2122; equity.

6.7 Breakdown of capital base

2009

Equity

62,602

54,566

Product funds

7,409

7,975

Provision for deferred taxation

24,964

28,340

Membersâ&#x20AC;&#x2122; loans

64,494

67,807

Pension provision (Guideline 271)

41,860

46,785

Total capital base

201,329

2008

205,473 (in thousands of euros)

The total pension provision (Guideline 271) is EUR 45,300 (2008: EUR 50,595). Actual commitments of EUR 3,440 (2008: EUR 3,810) have been made to current and former employees. The remaining amount of EUR 41,860 (2008: EUR 46,785) is a contingent liability and therefore this portion of the provision is included in the capital base..

6.8 Product funds

2009

2008

Net book value as at 1 January

7,975

8,827

Withdrawals

(2,956)

(4,066)

Additions charged to the result

2,275

2,810

Interest

115

404

Net book value as at 31 December

7,409

7,975 (in thousands of euros)

The product funds are short-term and subordinated. The rate of interest is based on one-month EURIBOR plus a mark-up.

6.9 Provisions The provisions are as follows: 2009

Pensions

47,363

52,786

Deferred taxation

24,964

28,340

Other provisions

41,302

43,611

Net book value as at 31 December

2008

113,629

124,737 (in thousands of euros)

Other provisions

Movements in deferred taxation and other provisions were as follows: Deferred taxation

1 January 2009

28,340

43,611

Withdrawals

(1,672)

Additions charged to the result

8,391

Release added to the result

(9,011)

Other movements

(3,376)

(17)

31 December 2009

24,964

41,302 (in thousands of euros)

Other movements in deferred taxation are due to realised revaluation results following disposals of revalued property, as well as the limitation on depreciation of property for tax purposes as a result of legislative changes. Other movements in the other provisions are largely due to transfers to and from other provisions.

Net pension provision The group contributes to a number of defined benefit plans in the Netherlands and the United Kingdom. The defined benefit pension is based largely on average salary and partly on final salary. Indexation of accrued and current entitlements is generally conditional. The calculations take account of the expected conditional indexation. The other countries have defined contribution plans.

The principal actuarial assumptions are as follows: Valuations as at

2009

2008

5.4

5.5

Discount rate

Expected return on plan assets - Shares

6.8

7.0

- Bonds

3.8

4.0

- Cash and cash equivalents

3.0

- Other (rights)

5.4

5.5

Expected future salary increases

2.5

Expected future indexation

2.0

Expected future indexation of current pensions

2.0

(%)

The liability in the balance sheet for defined benefit pension plans is as follows:

2009

2008

Net discounted value of earned pensions

175,424

166,027

Fair value of plan assets

150,267

132,380

Sub-total

25,157

33,647

Unrecognised actuarial gains or losses

20,143

16,948

Net pension provision (Guideline 271)

45,300

50,595

Other pension provisions

2,063

2,191

Total

47,363

52,786 (in thousands of euros)

The profit and loss account includes the following amounts for defined benefit pension plans: Liabilities attributable to the financial year

2009 3,281

2008 7,084

Attributable interest

9,016

9,660

Return on plan assets

(7,407)

(7,874)

Actuarial gains or losses

(1,143)

(33)

Exchange gains and losses

106

(431)

Curtailment

(3,823)

Expenses

309

Total for defined benefit plans

4,162

4,583

Pension cost for defined contribution plan

3,197

3,737

Total

7,359

8,320 (in thousands of euros)

The movements in the liability during the financial year were as follows:

2009

2008

Liability as at 1 January

166,027

203,366

Entitlements granted during the financial year

4,036

7,104

Interest

9,016

9,660

Pensions paid

(7,149)

(7,083)

Actuarial gains or losses

3,036

(37,527)

Exchange gains and losses

458

(1,811)

Curtailment

(7,682)

Liability as at 31 December

175,424

166,027 (in thousands of euros)

The movements in the plan assets during the financial year were as follows:

2009

2008

Plan assets as at 1 January

132,380

166,751

Expected return

7,407

7,874

Employerâ&#x20AC;&#x2122;s contributions

9,427

1,778

Employeesâ&#x20AC;&#x2122; contributions

755

813

Exchange gains and losses

367

(1,497)

Charges

(309)

Pensions paid

(7,149)

(7,083)

Actuarial gains or losses

7,389

(32,397)

Curtailment

(3,859)

Plan assets as at 31 December

150,267

132,380 (in thousands of euros)

The expected return is based on the extrapolation of the returns per asset class using the relevant indexes. - Other provisions The deferred taxation provision relates chiefly to the revaluation of intangible fixed assets and the provi sion under Guideline 271. The other provisions are for various risks, including the results of legal claims and tax matters. A provision has also been formed for costs arising from commitments for the redevelopment of current sites and reorganisation costs. Of the total provisions as at 31 December 2009, some EUR 14 million (2008: EUR 13 million) will be settled within one year and some EUR 36 million (2008: EUR 43 million) after five years.

6.10 Long-term liabilities

2009

Mandatory members’ loans

64,494

67,807

Other loans

39,634

27,124

Total

104,128

2008

94,931 (in thousands of euros)

- Mandatory and voluntary members’ loans Mandatory members’ loans are based on the liquidity levy, which is calculated in proportion to the value of the goods supplied. At the end of the year, the levy is converted into a mandatory members’ loan with a term of eight years and one day, with a starting date of 31 December and an expiry date of 1 January. The net amount of the long-term members’ loans is EUR 64.5 million (2008: EUR 67.8 million). The interest on these members’ loans is added to the principal amount unless a request for payment of the interest is received by 31 March. The rate of interest on the mandatory loans is set each year. In 2009, the rates on the various loans ranged from 3.05% to 5.95%. There were also voluntary members’ loans totalling EUR 18.6 million as at 31 December 2009 (2008: EUR 16.3 million) bearing interest rates from 3.50% to 5.15%. Mandatory members’ loans totalling EUR 11.3 million expire on 1 January 2010. Interest on these loans was paid at a rate of 6.1% in 2009. Members’ loans that mature within one year plus the accrued interest are included in current liabilities. The portion of these members’ loans due after five years is EUR 24.0 million (2008: EUR 30.4 million). The interest accrued and payable on the mandatory and voluntary members’ loans is classified as subordinated capital as at 31 December of the financial year. The members’ loans are subordinated to the bank loans.

- Other loans These are loans granted mostly by members of the Cooperative to finance capital expenditure by The Greenery on their behalf. The loans bear interest at rates between 0.41% and 3.525%, depending on the commencement date and term. The portion of these loans due after five years is EUR 32.6 million (2008: EUR 26.7 million).

Information on financial instruments At 31 December 2009 The Greenery B.V. had interest-rate derivatives outstanding for a principal amount of EUR 50 million. These interest-rate derivatives mature in 2011 at the latest. They relate to long-term financing and are used to hedge interest-rate risks. The costs associated with interest-rate derivatives are amortised over the term of the underlying contracts. Their fair value as at 31 December 2009 was EUR 2.0 million (negative). Forward currency contracts have been concluded to hedge currency risks arising on debtor positions in foreign currencies. Option contracts have also been concluded to hedge currency risks arising from future deliveries to specific buyers, involving outstanding options with a total value of GBP 27.6 million maturing on 30 December 2010.

The total contract value of the outstanding positions as at 31 December 2009 maturing within one year amounted to some EUR 43.2 million (2008: EUR 20.7 million). The estimated fair value of the forward currency contracts at the balance sheet date is approximately EUR 1.0 million higher than the book value. All contracts mature within one year.

6.11 Current liabilities Credit institutions and short-term loans

2009

2008

4,010

Current portion of long-term loans

393

458

Trade creditors

62,812

94,757

Grower creditors

11,272

20,969

Mandatory members’ loans

11,279

13,346

Voluntary members’ loans

18,568

16,320

Taxes and social security contributions

5,124

4,350

Pension contributions

2,026

4,405

Other liabilities

81,393

63,564

Accruals and deferred income

23,808

30,272

Total

220,685

248,456 (in thousands of euros)

Security The following security has been provided for the long and short-term loans from credit institutions: • first mortgage on property, viz. three distribution centres • pledge of debtors • pledge of rights under credit insurance policy

Commitments not disclosed in the balance sheet

2009

Guarantees and sureties

31,022

2008 34,140

Capital expenditure commitments

1,192

9,001

Lease and rental obligations

10,264

11,308

Other commitments

5,737

3,572

Total

48,215

58,021 (in thousands of euros)

Guarantees and sureties consist primarily of guarantees for EU grants. In addition, a number of legal proceedings were ongoing at the balance sheet date, for which provisions have been formed where considered necessary. The amount recognised for capital expenditure commitments relates to movable property and totals EUR 1.2 million (2008: EUR 2.2 million). The capital expenditure commitment in property is nil (2008: EUR 6.8 million). In 2009 lease agreements were concluded for a portion of the property (book value as at 31 December 2009: EUR 13.6 million) with an option to buy the property exercisable in 2012. Lease and rental obligations can be broken down as follows: â&#x20AC;˘ Payable in 2010: EUR 4,179 â&#x20AC;˘ Payable in 2011 to 2014: EUR 5,818

Related party transactions In 2009 The Greenery B.V. concluded transactions with the non-consolidated participating interests Europool System B.V. and Hessing B.V. These transactions were conducted on armâ&#x20AC;&#x2122;s length terms. The amount receivable from participating interests recognised under financial fixed assets relates to financing provided by The Greenery B.V. to Hessing B.V., which is subject to a market interest rate. In addition, an interest-free loan was received from Europool System B.V. which matures in 2010.

7 NOTES TO THE CONSOLIDATED PROFIT AND LOSS ACCOUNT Total operating income Total operating income comprises net turnover plus the cost of product sales from commission business 足activities and the sales of member products marketed by The Greenery B.V.

7.1 Total operating income Geographic spread

2009

2008

The Netherlands

804,727

847,751

Germany

179,088

245,733

United Kingdom

213,506

233,168

Rest of Europe

346,100

417,841

Rest of the world

83,408

69,472

Total

1,626,829

1,813,965 (in thousands of euros)

Breakdown by category Fruit and vegetables

1,460,821

1,668,540

Transport and other

101,379

93,269

Commission, levies and other services

64,629

52,156

Total

1,626,829

1,813,965 (in thousands of euros)

Commission, levies and other services This item includes commission and levies, and rental, packaging and sorting income, etc., as well as other operating income. Other operating income includes EUR 15.7 million (2008: EUR 17.6 million) relating to EU grants.

7.2 Other operating expenses Fees for the activities of the external auditor and the audit firm charged against the result for the financial year are included in other operating expenses for a sum of EUR 656,000 (2008: EUR 684,000). This amount is broken down as follows:

2009

2008

Audit of the financial statements*

409

448

Other audit engagements

175

198

Other non-audit services

Total

656

684 (in thousands of euros)

* Actual commitments of EUR 324,000 (2008: EUR 351,000) were charged by Deloitte Accountants B.V.

7.3 Financial income and expenses

2009

2008

Financial income

362

2,953

Financial expenses

(9,720)

(10,994)

Total

(9,358)

(8,041) (in thousands of euros)

Financial income and expenses mainly relate to interest income and expenses. Net interest of EUR 0.2 million was received from related parties (2008: EUR 0.2 million).

7.4 Profit from participating interests This item represents the profits and losses of non-consolidated participating interests.

7.5 Tax The tax payable is computed as follows: Profit for 2009

Gross profit

Corporate income tax

4,497

1,147

Permanent differences

1,204

307

5,701

1,454

Different rate of tax on foreign participating interests

Non-capitalised losses at participating interests

(270)

Settlement of prior year returns

236

Rounding differences

(24)

Tax in the profit and loss account

1,452 (in thousands of euros)

The permanent differences mostly concern non-deductible amortisation of goodwill. The Greenery B.V. and its wholly-owned Dutch subsidiaries are members of a fiscal unit. The net available tax loss at consolidated companies is nil (2008: nil).

7.6 Workforce Number of full-time equivalents (FTEs) employed at year-end

2009

2008

Board/MT/office

588

594

Logistics

894

897

Transport and other

173

170

Total

1,655

1,661 (in thousands of euros)

The average number of FTEs with permanent employment contracts during 2009 was 1,693 (2008: 1,679). The average number of temporary staff in FTEs was 943 (2008: 931). The higher average number of employees and temporary staff is largely attributable to increased fresh produce distribution activities for a Dutch retailer.

8 COMPANY BALANCE SHEET AS AT 31 DECEMBER 2009 . (BEFORE PROFIT APPROPRIATION) Assets

Note

2009

2008

10.1

69,271

61,235

69,271

61,235

14,597

8,563

Fixed assets Financial fixed assets Group company

Current assets EU grants receivable

Total assets

83,868

69,798 (in thousands of euros)

Liabilities

Note

2009

2008

Group equity

10.2

Revaluation reserve

78,040

81,942

Other reserves required by law

17,365

12,374

General reserve

(40,191)

(48,447)

Profit for the financial year

7,388

8,697

62,602

54,566

Long-term liabilities Group company

10.3

5,084

4,791

Current liabilities Group company

16,182

10,148

Other liabilities, accruals and deferred income

293

21,266

15,232

Total liabilities

83,868

69,798 (in thousands of euros)

9 COMPANY PROFIT AND LOSS ACCOUNT FOR 2009

2009

2008

Contributions and other income

1,089

473

Other expenses

(682)

(473)

Financial income and expenses

(407)

Company result after taxation

Profit from participating interests after taxation

7,388

8,697

Total profit

7,388

8,697 (in thousands of euros)

10 NOTES TO THE FINANCIAL STATEMENTS GENERAL The consolidated financial statements have been prepared in accordance with the provisions of Part 9 of Book 2 of the Dutch Civil Code. The accounting policies applied in the company financial statements are the same as those applied in the consolidated financial statements. Please see the notes to the consolidated financial statements for these accounting policies. Participating interests are carried at net asset value. The result of participating interests represents the companyâ&#x20AC;&#x2122;s share in the profit or loss for the financial year of the company concerned from the time it became part of the group or from the moment of acquisition. The company profit and loss account has been drawn up in accordance with the provisions of Section 402 of Book 2 of the Dutch Civil Code.

10.1 Financial fixed assets

Share premium

Revaluation reserve

Other statutory reserves

General reserve

Profit for previous and current financial years

Total

The movements in the shareholdersâ&#x20AC;&#x2122; equity of The Greenery B.V. were as follows:

Share capital

The Cooperative owns the entire share capital of The Greenery B.V., consisting of 281,000 Class A shares and 259,000 cumulative Class B preference shares. The Cooperative has issued depositary receipts for Class B shares to its members, of which over 70% were repurchased during 2008.

61,262

834

81,942

12,374

(103,874)

8,697

61,235

Revaluation

168

(28)

140

Realised revaluation on disposals . and depreciation

(3,902)

3,902

1 January 2009

Prior-year profit appropriation

8,697

(8,697)

Addition to reserve for participating interests

4,315

(4,315)

Profit for the financial year

7,388

Exchange losses and other movements

508

61,262

834

78,040

17,365

7,388

69,271

as at 31 December 2009

(95,618)

(in thousands of euros)

Realised revaluation on disposals and depreciation

General reserve

81,942

12,374

(48,447)

8,697

54,566

168

(28)

140

Total

Other statutory reserves

Revaluation

Revaluation reserve 1 January 2009

Previous and current financial years

10.2 Equity

(3,902)

3,902

Prior-year profit appropriation

8,697

(8,697)

Addition to reserve for participating interests

4,315

(4,315)

Profit for the financial year

7,388

Exchange gains and losses

508

78,040

17,365

7,388

62,602

31 December 2009

(40,191)

(in thousands of euros)

The revaluation reserve is for changes in the value of tangible fixed assets carried at current value. Realisation of the revaluation reserve is taken to shareholdersâ&#x20AC;&#x2122; equity.

As at 31 December 2009

Other statutory reserves

Addition to reserve for participating interests Exchange gains and losses

Reserve for exchange gains and losses

1 January 2009 Revaluation

Reserve for participating interests

Other statutory reserves In addition to the reserve for participating interests, the other reserves required by law include the reserve for exchange gains and losses. The movements in other statutory reserves were as follows:

14,047

(1,673)

12,374

168

4,315

508

18,530

(1,165)

17,365

(in thousands of euros)

10.3 Long-term liabilities To finance the repurchase of depositary receipts, a company belonging to the group of The Greenery B.V. supplied a loan of EUR 5.1 million, bearing an interest rate of 6% (2008: EUR 4.8 million). The loan has a term of four years, running from 1 October 2008 until 30 September 2012. The increase relates to depositary receipts repurchased in 2008 which were paid in 2009 and recognised under other liabilities, accruals and deferred income in 2008.

Remuneration of the members of the Board and Supervisory Board The total charge to the Cooperative for the remuneration of Board members for 2009 was EUR 213 (2008: EUR 189).

Events after the balance sheet date Name change On 10 February 2010 the company announced its intention to change its name to Coöperatie Coforta U.A.

Coöperatie The Greenery’s name change forms an integral part of the new cooperation model that is being introduced. The name change serves to highlight the Cooperative’s separate positioning and supports the implementation of its intrinsic strategy which aims to bind market-oriented growers by achieving robust market access based on high-quality supply chain bundling while offering room for individual entrepreneurship. Financing In February 2010 a subsidiary, Greenery UK Ltd., concluded an agreement with a U.K. trading and production company to carry out sales jointly to the U.K. market. This business collaboration will enable The Greenery to gain access to additional sales channels in the U.K. market. The Greenery also expects to be able to sell more of its own produce. A GBP 6.75 million long-term loan with a variable interest rate was granted for this purpose. A portion of the loan may be converted into shares in the U.K. company.

The Hague, 9 March 2010

The Board of Coöperatie The Greenery U.A. Th.L.J. Ammerlaan P.W.J.M. van Asseldonk A.W.G.M. Hop J.A.M. van der Harg J.C.M. van der Voort P.S.C. Oostveen B.J. Feijtel

Chairman Vice Chairman

11 LIST OF PARTICIPATING INTERESTS As at 31 December 2009 participating interests included the companies listed below. A full list of participating interests has been filed at the Chamber of Commerce in Rotterdam.

Consolidated participating interest Registered office The Greenery B.V. Hollander Barendrecht B.V. Disselkoen Airfreight B.V. Greenery Belgium N.V. HagĂŠ International B.V. Hoogsteder Groenten en Fruit B.V. Greenery UK Ltd. Greenery EspaĂąa S.A. Van Dijk Foods Belgium S.A. Internationaal Transportbedrijf Dijco B.V. J.H. Wagenaar GmbH J.H. Wagenaar B.V. Exploitatiemaatschappij Jager B.V. Jager Holland B.V. Greenery Italia Srl. Greenery Vastgoed B.V. Handelsmaatschappij Jover B.V. Mulder Onions B.V. Greenery Produce B.V. Greenery Convenience GmbH Greenery Poland Sp. z.o.o.

The Hague Barendrecht De Lier St. Katelijne Waver (B) Barendrecht Utrecht Huntingdon (UK) Carlet Valencia (E) St. Katelijne Waver (B) Delft Kempen (G) Zwaagdijk Nieuweschans Nieuw Amsterdam Verona (I) The Hague Nieuwegein Bleiswijk Maasland Kempen (G) Warsaw (PL)

Share in capital (%) 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 100 80 100

Non-consolidated participating interests Houdstermaatschappij Verpakkingsbedrijven B.V. Zoetermeer Heutinck Hortonomics B.V. Veldhoven Inova Fruit B.V. Geldermalsen Euro Pool System International B.V. (via Houdstermaatschappij Verpakkings-bedrijven B.V.) Leidschendam Hessing B.V. Langedijk

* No decisive control under the Articles of Association.

78.57 * 24 25.6 26.2 45

12 OTHER INFORMATION 12.1 Articles of association provisions governing profit appropriation Under Article 52 of the Articles of Association, the profit is appropriated as follows: Article 52 The Members’ Council shall decide the appropriation of any profit based on a Board proposal. If the Members’ Council resolves to distribute all or a portion of the profit, the agreed amount shall be distributed to the members in proportion to their turnover in the most recent financial year. Such distribution may be made other than in cash, including in securities, such as depositary receipts for shares in the capital of The Greenery B.V.

12.2 Proposed profit appropriation The Board of the Cooperative proposes to add the profit for 2009 of EUR 7,388,000 to the Cooperative’s general reserve, subject to an addition to the statutory reserve for participating interests of EUR 4,315,000. This proposal has not yet been incorporated into the financial statements.

12.3 Auditor’s report Report on the financial statements We have audited the 2009 financial statements of Coöperatie The Greenery U.A in The Hague, the Netherlands, accompanying this Annual Report, which comprise the consolidated and company balance sheet as at December 2009, the consolidated and company profit and loss account for the year then ended and the notes. Management’s responsibility Management is responsible for the preparation and fair presentation of the financial statements and for the preparation of the Annual Report both in accordance with Part 9, Book 2 of the Dutch Civil Code. This respon sibility includes designing, implementing and maintaining internal control relevant to the preparation and fair presentation of the financial statements that are free from material misstatement, whether due to fraud or error; selecting and applying appropriate accounting policies; and making accounting estimates that are reasonable in the circumstances. Auditor’s responsibility Our responsibility is to express an opinion on the financial statements based on our audit. We have conducted our audit in accordance with Dutch law. This requires that we comply with ethical requirements and that we plan and perform the audit to obtain reasonable assurance that the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the company financial statements. The procedures selected depend on the auditor’s judgement, including the assessment of the risks of material misstatement, whether due to fraud or error. In making those risk assessments, the auditor considers the internal control measures relevant to the entity’s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of accounting estimates made by management as well as evaluating the overall presentation of the financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion. Opinion In our opinion, the financial statements give a true and fair view of the financial position of Coöperatie The Greenery U.A. as at 31 December 2009 and of its result for the year then ended in accordance with Part 9, Book 2 of the Dutch Civil Code.

Report on other legal and regulatory requirements Pursuant to the legal requirement under Section 393(5)(f) of Book 2 of the Dutch Civil Code, we report, to the extent of our competence, that the Annual Report is consistent with the financial statements, as required under Section 391(4) of Book 2 of the Dutch Civil Code.

Rotterdam, 9 March 2009 Deloitte Accountants B.V.

Publication information Publication date: April 2010 Published by: T he Greenery Spoorwegemplacement 1 2991 VT Barendrecht, The Netherlands P.O. Box 79, 2990 AB Barendrecht, The Netherlands Telephone no.: +31 (0)180 65 59 11 E-mail: info@thegreenery.com www.thegreenery.com

D1003350

Compiled by: Tim Willaert Text and editing: The Greenery and Chapeau Communicatie, Rijswijk, The Netherlands Design: BTM, Rotterdam, the Netherlands Typesetting: Caps Communicatie, Abcoude, The Netherlands Printing: Artoos Communicatiegroep, Kampenhout, Belgium