Initial successes, it said, were reflected in an above-average milk price of €0.345/kg ($0.392). It added that key milestones including the fixed-price model and the MilkPlus program were implemented.
The company saw an increase of 0.7% to €1.54bn ($1.75bn) in sales revenue, with an export quota of 45.5% and an equity ratio of 33.4%.
2018 fiscal year
Hochwald said 2018 was marked by considerable volatility, primarily differences in fat and protein utilization. Protein listings remained at a historic low for the third year in a row, while fixed prices were recorded for butter.
Milestones in the reporting year included the introduction of the MilkPlus quality and sustainability program, with 50% of Hochwald farmers taking part - equivalent to roughly 75% of cooperative milk - and secured themselves a supplement on their milk price in doing so.
The program will be continue to be developed in 2019. The fixed-price model has been offered since the end of 2018. Based on the market milk price, farmers can commit quantities that are billed at the fixed price. So far, approximately 450 farmers have signed the framework agreement.
The company said investments were made at sites in Thalfang, Bolsward and Hünfeld. In Thalfang, construction of a new warehouse was completed and preparations are now under way for the installation of a fourth condensed milk line. In Bolsward, production has started on condensed milk in glass bottles. Further investments were made at the cheese factory in Hünfeld to expand capacity.
Initial payments have also been made for planning and approvals for the new plant in Mechernich. The investment sum for fixed assets was €43.4m ($49.3m) in total. In 2018, the company's equity capital increased to €190.7m ($216.7m), and the equity ratio increased from 31.5% to 33.4%.
Growth in 2019
Given the feed situation, milk supply is expected to be less in the first half of 2019 than it was in the previous year.
CEO Detlef Latka said, “We have our sights set firmly on our strategic objectives and will continue to focus on sustainable business development. We have reduced the time to market by restructuring our sales division, and are focussing on the strong-growth regions outside Europe.”
As a cooperative, Hochwald views continuous and sustained growth as a key priority.
“Unlike listed companies, we do not think in quarterly figures; long-term outcomes are what matters to us. At the same time, our goal is to permanently achieve an above-average milk price for our producers. We are laying the foundations for this with projects like our new dairy plant in Mechernich in North Rhine-Westphalia,” Latka added.
Construction started with a ground-breaking ceremony in May 2019; commissioning and the official opening are scheduled for 2021.
The Representative Assembly has also decided to issue an additional instalment of profit sharing certificates. Existing investors have the option of exchanging profit sharing certificates from the instalment expiring in 2019, and new investors will also be sought.
Meinolf Bödefeld, Thomas Fischer and Frank Hammen finished their terms on the board of directors and were all re-elected by the representative assembly.
André Dietsch, Marko Führer, Gerhard Jordan, Heinz Rütjes, Richard Schreiner, Georg Wilsmann and Klaus Werner Wolf came to the end of their terms on the supervisory board. Rütjes was not available for re-election, but all other Supervisory Board members were re-elected by the representative assembly. Edgar Trimborn stepped down from the supervisory board prematurely, while Andreas Buttgereit and Wilfried Fielenbach were newly elected to the supervisory board.