At the DLG Group's annual results meeting the Board of Representatives a historically large profit distribution of DKK 252 million. That is 45 per cent up compared to last year and corresponds to a return on the share capital of 17 per cent.
Chairman of the board of DLG, Niels Dengsø Jensen, says:
"Thanks to a great effort from skilled employees and managers, DLG has delivered the best annual results ever in a year that has been characterized by great volatility and uncertainty. We see progress across the board, but the German market stands out again this year. It is a very satisfactory result, which forms the background for us being able to distribute such a large amount of profit to our owners this year. The results of recent years have shown that DLG has a solid business model and with our new strategy, Creating the Future 2030, we are ready to take the next steps on the road to a more sustainable future."
New model for profit distribution
As part of a new ownership strategy, DLG's Board of Representatives has decided to change the model for profit declaration with effect from this year. This means that the individual shareholder's profit distribution will be split up, so that 1/3 of the profit distribution is paid out in advance, while 2/3 is set aside in the cooperative account. Until now, the entire amount has been paid into the owner’s cooperative account and only paid out when the amount exceeded one million kroner or in connection with the owner ceasing to be a farmer.
"The average age of Danish farmers is increasing, and we need new capacities to enter the profession. With the new model we would like to give the next generation of farmers a little extra capital when they start up," says Niels Dengsø Jensen, and continues:
"It has been a clear wish from our owners that part of the amount should be distributed to the farmers immediately. That is what we are ensuring now, and we hope that it will strengthen the farmer's ability and desire to invest in his farm and in the sustainable transition."
At the same time, it has been decided that up to 15% of the total amount for profit declaration can be earmarked for products, the so-called green funds. In the future farmers will thus be rewarded to a greater extent for making more sustainable choices. The new model is an incentive to encourage the owners to opt for the most sustainable products when they trade with DLG.
"The agricultural and food industry has set ambitious goals for a more sustainable future, and if we are to deliver on them it requires action from the companies, but also from the individual farmer. Therefore, we want to create a structure that motivates our owners to make the more sustainable choice," says Niels Dengsø Jensen.
In 2023, DLG will launch a range of more sustainable products, which will form the basis for the profit declaration from the green funds.