Annual report 2016.pdf

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Mongolia, Ulaanbaatar 17040, Mongolia, Ulaanbaatar 17040, Khan-Uul district, Chinggis Avenue 48. Khan-Uul district, Chinggis Avenue 48. Phone: 11-344837

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•

• Board

Board of

of Directors

Directors

•

• Remuneration

Remuneration and

and promotion

promotion

•

• Corporate

Corporate governance

governance

code

implementation program

•

• Share

Share portfolio

portfolio

•

• Dividend

Dividend policy

policy

•

• Executive

Executive management

management team

team

•

• Risk

Risk management

management

CORPORATE GOVERNANCE

•

• Sustainability

Sustainability policy

policy

•

• Human

Human

resource

resource policy

policy

•

• Corporate

Corporate

Social

Responsibility and

Projects

S U

S US T

S T

A I

A IN A

N A

B I

B IL I

L IT Y

T Y

F I

F IN A

N AN C

N C

I A

I AL

L

R E

R EP O

P OR T

R TI N

I NG

G

•

• Financial

Financial statement

statement

•

• Independen

Independent

t Auditors’

Auditors’

Report

DEFINITION OF

TERMINOLOGIES

•

• Mission

Mission and

and values

values

•

• Greetings from

Greetings from the Chairman

the Chairman of

of the Board

the Board of

of Directors

Directors

•

• Greetings

Greetings from

from the

the CEO

CEO

•

• Business

Business in

in brief

brief

• Strategy

•

• Market

Market and

and the

the current

current state

state

• Operations

•

• New

New and

and renewed

renewed brands

brands

BUSINESS ACTIVITIES

COMPAN

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ENTREPRENEURIAL ENTREPRENEURIAL SPIRITSPIRIT::

We champion teamwork,

collaboration and creativity at all

levels, encouraging and

rewarding

our people to become and deliver

their very best.

OPENNESS: OPENNESS:

We are driven by a

commitment to

complete transparency, sharing our

goals to inspire and

engage those

we serve

ORIGINALITY: ORIGINALITY:

We bring flair and imagination to

every challenge, always seeking

smarter ways to enrich and

sup¬port the partners and commu

-

-ni¬ties we work with.

ni¬ties we work with.

INTEGRITY: INTEGRITY:

We uphold the virtues of honesty

and moral discipline in everything

we do, embracing our responsibility

to preserve Mongolia’s natural rich

-

-ness and drive higher standards in

ness and drive higher standards in

economic, social and environmental

development.

COMPANY PROFILE COMPANY PROFILE

By producing superior products that celebrate natural richness, APU

contributes to the enhancement of Mongolia’s future prosperity and its

place on the world stage

COMPANY PROFILE

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Beer factory facilities, Beer factory facilities, networks and networks and technol-ogy were completely ogy were completely renovated; a factory renovated; a factory with packaging with packaging capac-ity of 20.0 million liters ity of 20.0 million liters of beer per year was of beer per year was put into operation. The put into operation. The rst Mongolian dark rst Mongolian dark beer “Khar Khorum” beer “Khar Khorum” in glass bottle and in glass bottle and premium beer “Golden premium beer “Golden Gobi” was launched Gobi” was launched on the market. Also on the market. Also “Eruul” vodka brand “Eruul” vodka brand was introduced. was introduced.

APU JSC established APU JSC established a milk and fruit juice a milk and fruit juice factory, also factory, also intro-duced the “Pure Milk” duced the “Pure Milk” brand along with fully brand along with fully automated tetra-pack automated tetra-pack line. Updated line. Updated success-fully “Eruul” and “Altan fully “Eruul” and “Altan Turuu” vodka brands. Turuu” vodka brands.

A modern distillery A modern distillery plant “Natur Agro” plant “Natur Agro” equipped with German equipped with German equipment and equipment and tech-nology, with nology, with comput-erized control system erized control system was accepted by the was accepted by the state inspection state inspection com-mission. “Fusion” beer mission. “Fusion” beer brand and children’s brand and children’s juice beverage juice beverage “Frutta”“Frutta”

were introduced to the were introduced to the consumer market consumer market

A brand new dairy A brand new dairy plant with processing plant with processing equipment supplied equipment supplied by the world leading by the world leading German GIA (GEA) German GIA (GEA) Company is put into Company is put into operation. On its 90th operation. On its 90th anniversary, APU anniversary, APU updates its corporate updates its corporate identity and redenes identity and redenes its vision: Absolute, its vision: Absolute, Pure, Unique. Pure, Unique.

In November, 51% of In November, 51% of state owned shares state owned shares were auctioned and were auctioned and transferred fully to transferred fully to private investors, private investors, being the rst to being the rst to open the process open the process of privatization of of privatization of Mongolian factories Mongolian factories and enterprises. and enterprises. Old building of Old building of Water and soft Water and soft drink factory, lines, drink factory, lines, equipment and equipment and technology were technology were fully renovated, a fully renovated, a plant with a bottling plant with a bottling capacity of 4.5–5.0 capacity of 4.5–5.0 million liters of 0.33, million liters of 0.33, 0.5, 1.5, 2 L plastic 0.5, 1.5, 2 L plastic bottles per year was bottles per year was put into operation. put into operation. “APU Pure water” “APU Pure water” brand was delivered brand was delivered to consumers. to consumers. Super premium Super premium “Soyombo” vodka “Soyombo” vodka was introduced to was introduced to the market. the market.

A new brewery with A new brewery with advanced new advanced new tech-nologies and nologies and stan-dards was put into dards was put into operation bringing operation bringing the total capacity to the total capacity to 100 million liters per 100 million liters per year; fully year; fully automat-ed “APU logistics” ed “APU logistics” center with center with ad-vanced warehouse vanced warehouse technologies was technologies was established. established. “Orgi-luun” carbonated luun” carbonated water is water is introducedintroduced to the Mongolian to the Mongolian market. Well known market. Well known by Mongolians by Mongolians “Borgio” beer was “Borgio” beer was completely updated. completely updated.

The “New Wave” The “New Wave” brand program is brand program is launched, launched, introduc-ing to the market ing to the market brands such as brands such as Bliss (fruit avored Bliss (fruit avored beer), vodkas beer), vodkas including VELVET, including VELVET, EDEN, ARKHI EDEN, ARKHI EXPORT /40 years/, EXPORT /40 years/, Taiga /4 types/ and Taiga /4 types/ and Okhi. Okhi. COMPANY PROFILE COMPANY PROFILE Regulations on Regulations on “Appropriating alcohol “Appropriating alcohol licenses by the state” licenses by the state” were approved by the were approved by the V meeting of the V meeting of the Cen-tral Committee of the tral Committee of the Mongolian People’s Mongolian People’s Party and VII meeting Party and VII meeting of the People’s of the People’s Gov-ernment. Thus the rst ernment. Thus the rst vodka factory with vodka factory with 14 employees was 14 employees was opened in Ulaanbaatar opened in Ulaanbaatar city. city. Brewery Brewery cool-ing, pressured ing, pressured gas equipment gas equipment was installed; was installed; a mechanized a mechanized conveyer belt conveyer belt with bottling with bottling capacity of capacity of 3000 bottles of 3000 bottles of beer per hour beer per hour was put into was put into op-eration, made eration, made technological technological progress. progress.

The Soviet Union The Soviet Union assisted to complete assisted to complete construction work, construction work, equipment and equipment and network installation network installation of the Vodka and beer of the Vodka and beer factory, implemented factory, implemented the calibration and the calibration and test work. The factory test work. The factory was commissioned by was commissioned by the MPR Government the MPR Government Act dated December Act dated December 31, 1972. 31, 1972.

By the resolution By the resolution num-ber 10 of the Council ber 10 of the Council of MPR Ministers, of MPR Ministers, dat-ed January12, in 1973 ed January12, in 1973 the Vodka and beer the Vodka and beer factory was renamed factory was renamed to Ulaanbaatar Vodka to Ulaanbaatar Vodka and beer factory. and beer factory.

Vodka and beer Vodka and beer factory was factory was restructured to APU restructured to APU JSC, 51% of total JSC, 51% of total shares remained shares remained under state control, under state control, and 49% was and 49% was traded on the stock traded on the stock exchange. exchange.

With the help With the help of Czech of Czech ex-perts started perts started producing producing beer. beer. Carbonated sweet Carbonated sweet beverage and beverage and Janchivlan mineral Janchivlan mineral water bottling water bottling station were newly station were newly established established

On the 50th On the 50th anniver-sary of the People’s sary of the People’s revolution, the revolution, the MPR government MPR government awarded the Vodka awarded the Vodka and beer factory and beer factory with an “Honorary with an “Honorary certicate” for certicate” for well-organized well-organized production and production and service activities, service activities, and successfully and successfully fullling assigned fullling assigned responsibilities. responsibilities. Since 1976, 5 years Since 1976, 5 years in a row the Vodka in a row the Vodka and beer factory and beer factory was named the was named the National leading National leading producer and producer and awarded with the awarded with the state highest medal state highest medal of “Golden Star”. of “Golden Star”. Celebrating the Celebrating the event of the event of the Mongo-lian astronaut ying lian astronaut ying rst time to the rst time to the space, the premium space, the premium vodka “Bolor” was vodka “Bolor” was introduced to the introduced to the customers. customers. COMPANY PROFILE COMPANY PROFILE

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9.

Annual report 2016 Annual report 2016 APU Company APU Company

ABSOLUTE.

Fiduciary duties and

responsibilities

•

• Leader Leader in in human human and and socialsocial development. development. •

• Educating Educating the the market market and and ourour partners in our mission. partners in our mission. •

• Financial Financial stability, stability, transparencytransparency and sustainable performance. and sustainable performance. •

• One One of of the the most most attractiveattractive employers in Mongolia. employers in Mongolia.

PURE.

Products, culture and beliefs

•

• Mongolia’s Mongolia’s global global brandbrand ambassador ambassador •

• Open Open to to the the world, world, creatingcreating partnerships with world-class partnerships with world-class businesses

businesses

UNIQUE.

Ethical conduct and respect

for our environment

•

• Continuous Continuous manufacturingmanufacturing improvement through clean improvement through clean technologies. technologies. •

• The The highest highest standards standards inin corporate transparency and corporate transparency and product safety product safety •

• Unique Unique expertise expertise in in communitycommunity participation.

participation.

COMPANY PROFILE

8.

APU CompanyAPU Company Annual report 2016Annual report 2016

In the traditional nomadic culture and philosophy of Mongolia sky is the symbol of pure in In the traditional nomadic culture and philosophy of Mongolia sky is the symbol of pure in- -nity, the whole world is believed to be a unique combination of wild nature, time and mind. nity, the whole world is believed to be a unique combination of wild nature, time and mind. Together, these 2 exceptional features keep absolute pure qualities for years. By the Mon Together, these 2 exceptional features keep absolute pure qualities for years. By the Mon- -golian tradition to honor “The Best” we proudly deliver to you the trinity of “Absolute, pure, golian tradition to honor “The Best” we proudly deliver to you the trinity of “Absolute, pure, unique”. We made this belief our business philosophy and we strive to improve everything unique”. We made this belief our business philosophy and we strive to improve everything we do. We will always work to improve the business, products and services designed for our we do. We will always work to improve the business, products and services designed for our customers and community.

customers and community.

Absolute, Pure, Unique

COMPANY PROFILE

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11.

Annual report 2016 Annual report 2016 APU Company APU Company CEO OF APU COMPANY

CEO OF APU COMPANY

ERDENEBILEG Tseveenjav

The year of 2016 has been a tough one for Mon

The year of 2016 has been a tough one for Mon- -golian enterprises presenting hard challenges

golian enterprises presenting hard challenges

that came along with socio-political changes,

continued nancial crisis and economic insta

continued nancial crisis and economic insta- -bility. However, it is worth noting that APU Com

bility. However, it is worth noting that APU Com- -pany has successfully maintained its leadership

pany has successfully maintained its leadership

status in the sector, contributing great efforts to

the national development together with the other

major producers. Specically, for the purpose of

increasing protability through productivity, the

company introduced new and refreshed brands

to the market and invested in the

to the market and invested in the personal growthpersonal growth

of its workforce, continuing the “Tuguldur” proj

of its workforce, continuing the “Tuguldur” proj- -ect, complying with international standards and

ect, complying with international standards and

maintaining stable employment.

It is my pleasure to inform you that we produced

a total of 92 million liters of 162 SKUs, including

VELVET, EDEN, ARKHI EXPORT /40 year/, Taiga

/4 flavors/, Okhi, and “D” vitamin enriched milk,

conducted sales of MNT 327 billion, paid MNT

127 billion to the state budget and ensured nor

127 billion to the state budget and ensured nor- -mal continuity of business operations while im

mal continuity of business operations while im- -plementing a comprehensive long-term invest

plementing a comprehensive long-term invest- -ment program.

ment program.

The year-end share price showed an increase of

3 percent as compared to that of the beginning

of the year (after taking into account the effect of

share split), and we repaid a total of USD 16 mil

share split), and we repaid a total of USD 16 mil- -lion to international banking and nancial insti

lion to international banking and nancial insti- -tutions, and 3 billion MNT was invested into our

tutions, and 3 billion MNT was invested into our

production facility upgrade and maintenance.

Focusing on increasing efciency and improving

productivity, APU Company is planning to pro

productivity, APU Company is planning to pro- -duce 94 million liters of 124 SKUs, and conduct

duce 94 million liters of 124 SKUs, and conduct

sales of MNT 339 billion in 2017. A total of USD16

million shall be paid to international banking and

nancial institutions, efforts will continue to in

nancial institutions, efforts will continue to in- -crease exports, sustainable business operations

crease exports, sustainable business operations

shall be maintained and goals and objectives

shall be achieved in the framework of the overall

corporate and business strategies.

I would like to express my sincere gratitude to

our shareholders, customers and partners for

always supporting our business. We pledge to

continue our efforts to maintain growth and de

continue our efforts to maintain growth and de- -velopment,

velopment, run eco-friendly operations, invest inrun eco-friendly operations, invest in

human resources and fulll our corporate social

responsibilities. responsibilities.

Dear shareholders,

customers, partner

organizations, and

colleagues. I am

pleased to extend

my warm greetings

to all of you.

* Gross

* Gross revenue included VAT and Excise taxrevenue included VAT and Excise tax

10.

Chairman of the Board of Directors Chairman of the Board of Directors

BATSAIKHAN Purev BATSAIKHAN Purev

It is the time of the year when we traditionally re It is the time of the year when we traditionally re- -port to our shareholders on th

port to our shareholders on the results of our laste results of our last year’s work. The year of 2016 was a difcult; the year’s work. The year of 2016 was a difcult; the unfavorable macroeconomic situation of Mon unfavorable macroeconomic situation of Mon- -golia persisted; the national currency continued golia persisted; the national currency continued its steep devaluation trend and the total con its steep devaluation trend and the total con- -sumer market shrunk.

sumer market shrunk.

APU Company worked with determination to ful APU Company worked with determination to ful- -ll its obligations and to overcome the challeng ll its obligations and to overcome the challeng- -es faced, introducing new vodka and beer brands es faced, introducing new vodka and beer brands to the markets and implementing cost saving to the markets and implementing cost saving initiatives. However, the more than 20% devalua initiatives. However, the more than 20% devalua- -tion of the tugrug to USD currency exchange rate tion of the tugrug to USD currency exchange rate since the beginning of 2016 led to a signicant since the beginning of 2016 led to a signicant decline of the net prot compared to the p decline of the net prot compared to the previousrevious year. Nevertheless, we made a decision to uphold year. Nevertheless, we made a decision to uphold our continued tradition to distribute dividends to our continued tradition to distribute dividends to our esteemed shareholders.

our esteemed shareholders.

The Government of Mongolia has announced The Government of Mongolia has announced that in 2017 several taxes will be increased and that in 2017 several taxes will be increased and there will be cuts in certain types of social wel there will be cuts in certain types of social wel- -fare. Analysts are highlighting that this year the fare. Analysts are highlighting that this year the economic situation will be the most challeng economic situation will be the most challeng- -ing; the economic growth is at the lowest point; ing; the economic growth is at the lowest point; we can expect to see revival not earlier than in we can expect to see revival not earlier than in 2018-2019. We are now faced with a challenge 2018-2019. We are now faced with a challenge to

to “tighten our belts” “tighten our belts” and optimize our and optimize our interinter- -nal resources to overcome the difculties. APU nal resources to overcome the difculties. APU Company, the leading manufacturer, top tax pay Company, the leading manufacturer, top tax pay- -er and one of the oldest and most valued listed er and one of the oldest and most valued listed companies of Mongolia, will continue its efforts companies of Mongolia, will continue its efforts to grow and develop. While the short-term focus to grow and develop. While the short-term focus

is on saving costs, retaining jobs and helping the is on saving costs, retaining jobs and helping the employees with their social issues, the long-term employees with their social issues, the long-term goal to continually increase the value of the com goal to continually increase the value of the com- -pany will never lose its priority.

pany will never lose its priority.

We believe that hardship is a force that creates We believe that hardship is a force that creates new opportunities. We will be continuing our tra new opportunities. We will be continuing our tra- -dition to always seek, generate and lead innova dition to always seek, generate and lead innova- -tion, create new products and open new markets. tion, create new products and open new markets. Dear shareholders, esteemed partners and loy Dear shareholders, esteemed partners and loy- -al customers, with -all the above we would like to al customers, with all the above we would like to express our condence that with your valuable express our condence that with your valuable support APU Company will overcome these tem support APU Company will overcome these tem- -porary difculties and advance to a new era of porary difculties and advance to a new era of development and prosperity

development and prosperity Dear shareholders,

Dear shareholders, COMPANY PROFILE

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13.

13. 2016

2016

OVERVIEW

12.

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15.

THE RESULTS OF 2016 ARE THE OUTCOMES OF EFFECTIVE REALIZATION OF OUR STRATEGIC

POLICIES AND ACCURACY OF OUR OPERATIONS.

2 2001166 22001155 Change Change %% Sales volume Sales volume _t_t_h_h_o_o_u_u_s_s_._._l_l_i_i_t_t_e_e_r_r ₉₉₂₂_,_,₈₈₅₅₀₀ ₉₉₄₄_,_,₅₅₃₃₃₃ _-_-₂₂_%_% Production volume Production volume tthhoouuss..lliitteer r 8888,,44445 5 9900,,66006 6 --22%%

PROFIT & LOSS

PROFIT & LOSS N Neet t ssaallees s rreevveennuuees s mmllnn..ttuug g 220088,,00555 5 221100,,11111 1 --11%% O Oppeerraattiioonnaal l pprroot t mmllnn..ttuug g 3366,,11552 2 3344,,22004 4 66%% N Neet t pprroot t mmllnn..ttuug g 22,,88883 3 1100,,66770 0 --7733%% BALANCE SHEET BALANCE SHEET T Toottaal l aasssseetts s mmllnn..ttu g u g 22991 ,1 ,00770 0 330055,,6 76 72 2 --5 %5 % T Toottaal l lliiaabbiilliittiiees s mmllnn..ttuug g 114477,,88884 4 116600,,11778 8 --88%% T To to ta l a l o wo wn en er sr s’ ’ e qe qu iu it y t y m lm ln .n .t ut ug g 1 41 43 ,3 ,1 81 85 5 1 41 45 ,5 ,4 94 94 4 - 2- 2%% T To to ta l a l o wo wn en er sr s’ ’ e qe qu iu it y t y a na nd d l il ia ba bi li li ti ti ei es s m lm ln .n .t ut ug g 2 92 91 ,1 ,0 70 70 0 3 03 05 ,5 ,6 76 72 2 - 5- 5%% CASH FLOW CASH FLOW C Caassh h ffllo wo ws s ffrroom m ooppeerraattiinng g aaccttiivviittiiees s mml nl n..ttu g u g 447 ,7 ,77557 7 4400,,330 8 0 8 118 %8 % C a C as h s h f lf lo wo ws s f rf ro m o m i ni nv ev es ts ti ni ng g a ca ct it iv iv it it ie s e s m lm ln .n .t ut ug g ( 2( 2, 9, 96 56 5) ) ( 4( 4, 6, 68 98 9) ) - 3- 37 %7 % C a C assh h f lf lo wo ws s f rf ro m o m n an an cn ci ni ng g a ca ct it iv iv it it ie s e s mml nl n. t. tu g u g ( 3( 35 ,5 ,1 31 32 ) 2 ) ( 3( 38 ,8 ,8 68 62 ) 2 ) - 1- 10 %0 %

Net increase/decrease in cash and cash

equivalents equivalents mmllnn..ttuug g 99,,66660 0 ((33,,224433) ) --339988%% TAX PAYMENT TAX PAYMENT Excise tax Excise tax mmllnn..ttuug g 9900,,44220 0 9900,,77990 0 00%% VAT VAT mmllnn..ttuug g 1199,,11119 9 1199,,22774 4 --11%% O Otthheer r mmllnn..ttuug g 1177,,44222 2 1144,,55999 9 1199%% T Toottaal l 112266,,99661 1 112244,,66662 2 22%% CAPEX CAPEX T Toottaal l ccaappeex x mmllnn..ttuug g 22,,99777 7 55,,00221 1 --4411%% COMPANY PROFILE COMPANY PROFILE

14.

OPERATIONAL PROFIT OPERATIONAL PROFIT (Billion tugrug) (Billion tugrug)

12 13 14 15 16

3 3 7 7 2 2 4 4 1 1 2 2 3 3 4 4 6 633 NET SALES REVENUES

NET SALES REVENUES (Billion tugrug) (Billion tugrug)

12 13 14 15 16

1 1 6 6 9 9 11 9 9 4 4 1 1 9 9 8 8 2 2 1 1 0 0 2 2 0 0 8 8 NET PROFIT NET PROFIT (Billion tugrug) (Billion tugrug)

12 13 14 15 16

2 2 3 3 5 5 ( ( 1 1 0 0 ) ) 1 1 1 1 3 3 WORKFORCE WORKFORCE

12 13 14 15 16

8 8 9 9 7 7 9 9 9 9 8 8 9 9 5 5 3 3 8 8 8 8 3 3 8 8 1 1 7 7 SALES VOLUMES SALES VOLUMES (Million liters) (Million liters)

12 13 14 15 16

8 8 2 2 9 9 5 5 9 999 9 9 1 1 8 8 8 8 SKUs SKUs (SKU) (SKU)

12 13 14 15 16

8 8 3 3 9 9 4 4 0 011 7 7 1 1 3 3 6 6 6 611 2 2 COMPANY PROFILE COMPANY PROFILE

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17.

17. BUSINESS

BUSINESS

ACTIVITIES

BUSINESS ACTIVITIES BUSINESS ACTIVITIES

16.

HOUSEHOLDS HOUSEHOLDS /5% of total households/ /5% of total households/ Food Food consumption consumption HOUSEHOLDS HOUSEHOLDS /62% of total households/ /62% of total households/ Yearly electricity Yearly electricity consumption of consumption of households households STAFFS STAFFS /17% of total staff/ /17% of total staff/ Annual salary Annual salary of public of public servants servants KM KM

/Road from UB to Darkhan-Uul

aimag/ aimag/ Length of Length of concrete concrete roads roads HE LAND HE LAND

/land for 54 thousand

households/ households/ Mining Mining rehabilitation rehabilitation expense expense STUDENTS STUDENTS /13% of total students/ /13% of total students/ Providing better Providing better school environment school environment to students to students

WHAT CAN BE DONE WITH TOTAL TAXES PAID BY

APU COMPANY IN 2016?

VALUE ADDED TAX

REVENUES

billion

tugrug

EXCISE TAX

REVENUES

billion

tugrug

MONGOLIAN STATE

BUDGET REVENUES

billion

tugrug

In 2016, APU Company has contributed

In 2016, APU Company has contributed 127 billion MNT to the State budg127 billion MNT to the State budget of which 90 billion MNT was excise tax pet of which 90 billion MNT was excise tax paymentayment and 19 billion

and 19 billion MNT was VAT payment.MNT was VAT payment.

Source: Government decree number 336, budget

Source: Government decree number 336, budget benchmark assessments,benchmark assessments,

National Statistic Ofce of Mongolia, Ministry of Environment and Tourism

COMPANY PROFILE

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19.

19. In 2016, we prioritized the

In 2016, we prioritized the

following objectives:

Adopting a unied time saving, Adopting a unied time saving, low-cost and high-efciency production cost and high-efciency production system through process-oriented man system through process-oriented man- -agement structure with proper stafng agement structure with proper stafng and organization.

and organization.

Encouraging eco-friendly production Encouraging eco-friendly production and utilizations cost savings through and utilizations cost savings through re-use and recycling. re-use and recycling. Efciency at all levels for increased Efciency at all levels for increased protability.

protability.

Maintaining and expanding market Maintaining and expanding market share for sales revenue growth. share for sales revenue growth.

Increasing productivity through an enabling Increasing productivity through an enabling corporate culture and continuous learning corporate culture and continuous learning environment.

environment.

Improving information flows to achieve bet Improving information flows to achieve bet- -ter leadership, enhanced la-teral and vertical ter leadership, enhanced lateral and vertical collaboration, and alignment with corporate collaboration, and alignment with corporate objectives.

objectives.

Maintaining sustainability through de Maintaining sustainability through de- -termining a comprehensive brand policy termining a comprehensive brand policy and monitoring the implementation. and monitoring the implementation. Matching brands to consumer needs Matching brands to consumer needs through use of marketing techniques through use of marketing techniques with multiple alternatives in accordance with multiple alternatives in accordance with the brand policy documents. with the brand policy documents. STANDARDIZE STANDARDIZE BUSINESS BUSINESS PROCESSES PROCESSES IMPROVE IMPROVE INFORMATION INFORMATION FLOWS FLOWS INCREASE INCREASE RETURNS ON RETURNS ON INVESTMENT INVESTMENT MAINTAIN MAINTAIN MARKET MARKET SHARE SHARE BUSINESS ACTIVITIES BUSINESS ACTIVITIES

The following strategies were compiled in order to achieve the above objectives

18.

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21.

The world carbonated water market grows by an The world carbonated water market grows by an averageaverage 1.4 percent annually, reaching 235.6 billion liters, juice 1.4 percent annually, reaching 235.6 billion liters, juice market by 2 percent reaching 85.6 billion liters, and water market by 2 percent reaching 85.6 billion liters, and water market by 3.7 percent, reaching 282.7 billion liters. Car market by 3.7 percent, reaching 282.7 billion liters. Car- -bonated drinks account for over 30 percent of beverag bonated drinks account for over 30 percent of beverag- -es sold globally, however consumption of bottled water, es sold globally, however consumption of bottled water, sports and functional beverages, energy drinks, and fresh sports and functional beverages, energy drinks, and fresh natural juice tends to increase in line with the growth natural juice tends to increase in line with the growth speed in recent years.

speed in recent years.

The Mongolian carbonated drinks market reached 157.8 The Mongolian carbonated drinks market reached 157.8 liters in 2016, increasing by 16.9 percent while the packed liters in 2016, increasing by 16.9 percent while the packed juice market declined by 10.4 percent,

juice market declined by 10.4 percent, reaching 59 millionreaching 59 million liters, and the bottled water market went up by 3.9 per liters, and the bottled water market went up by 3.9 per- -cent, counting to 65.6 million liters as compared to those cent, counting to 65.6 million liters as compared to those of the previous year.

of the previous year.

Import products account for 9.8 percent of the carbon Import products account for 9.8 percent of the carbon- -ated drinks market, 25 percent of the juice market, and ated drinks market, 25 percent of the juice market, and about 1 percent of the bottled water market in Mongolia. about 1 percent of the bottled water market in Mongolia. As of 2016, APU Company produced 27 SKUs of 6 brands, As of 2016, APU Company produced 27 SKUs of 6 brands, supplying 2.8 percent of the carbonated drinks market, supplying 2.8 percent of the carbonated drinks market, 3.4 percent of the juice market, and 6.2 percent of the 3.4 percent of the juice market, and 6.2 percent of the bottled water market.

bottled water market. The world beer sales were 188.3 billion liters in 2015

The world beer sales were 188.3 billion liters in 2015 due to socio-economic

due to socio-economic changes and consumer at changes and consumer at- -titude, and increased by 0.2 percent reaching 188.6 titude, and increased by 0.2 percent reaching 188.6 billion liters in 2016. Consumption of beer tends to be billion liters in 2016. Consumption of beer tends to be stable globally.

stable globally.

In 2016, Mongolian beer market reached physically In 2016, Mongolian beer market reached physically 100.3 million liters, decreasing by 3.0 percent as com 100.3 million liters, decreasing by 3.0 percent as com- -pared to that of the previous year. Beer consumption pared to that of the previous year. Beer consumption per person was 37.1 liters a year as of 2013, whilst it per person was 37.1 liters a year as of 2013, whilst it dropped down by nearly 13 percent, reaching dropped down by nearly 13 percent, reaching 32.2 liters32.2 liters in 2016.

in 2016.

As the domestic beer production capacity, product As the domestic beer production capacity, product development, marketing and PR, as well as domestic development, marketing and PR, as well as domestic product quality improves signicantly, the space for product quality improves signicantly, the space for foreign brands and importers is shrinking. According to foreign brands and importers is shrinking. According to the performance of 2016, import products constitute the performance of 2016, import products constitute 20 percent of the Mongolian beer market, decreasing 20 percent of the Mongolian beer market, decreasing by 43 percent as compared to that of 2013. by 43 percent as compared to that of 2013. Due to consumption behavior and purchasing power Due to consumption behavior and purchasing power of consumers, the consumption of cheap or expensive of consumers, the consumption of cheap or expensive beer increases whilst the market for mid-priced ones beer increases whilst the market for mid-priced ones stagnates or shrinks.

stagnates or shrinks.

APU Company produced a total of 39 SKUs of 12 APU Company produced a total of 39 SKUs of 12 brands as of 2016, taking up 57 percent of the beer brands as of 2016, taking up 57 percent of the beer market share.

market share.

BUSINESS ACTIVITIES

20.

In terms of health benets, the trend of consuming liquid In terms of health benets, the trend of consuming liquid milk daily and constantly is extending at all levels, and fol milk daily and constantly is extending at all levels, and fol- -lowing this trend, production and supply of such products is lowing this trend, production and supply of such products is also increasing.

also increasing.

By 2025, the market capacity for milk and dairy products is By 2025, the market capacity for milk and dairy products is likely to increase by 25 percent, reaching 208 billion liters and likely to increase by 25 percent, reaching 208 billion liters and average annual milk consumption per person by 12 percent, average annual milk consumption per person by 12 percent, reaching 13 liters as compared to 2016. In recent years, the reaching 13 liters as compared to 2016. In recent years, the international market for flavored milk with low fat and sup international market for flavored milk with low fat and sup- -plements is expanding rapidly, while the growth of liquid milk plements is expanding rapidly, while the growth of liquid milk market is declining and tend to stabilize, however it still re market is declining and tend to stabilize, however it still re- -tains the majority share of the overall market. tains the majority share of the overall market. Milk and dairy market in Mongolia declined by 7 percent in Milk and dairy market in Mongolia declined by 7 percent in 2015, whereas it went up by 1 percent in 2016 where over 2015, whereas it went up by 1 percent in 2016 where over- -all market share reached 43,586 thous.liters. This growth in all market share reached 43,586 thous.liters. This growth in dairy market is closely related to the changes in consump dairy market is closely related to the changes in consump- -tion structure of Mongolian consumers resulting in transi-tion tion structure of Mongolian consumers resulting in transition by Mongolian customers from traditional dairy consumption by Mongolian customers from traditional dairy consumption to processed and packed product consumption. In recent to processed and packed product consumption. In recent years, market share of imported liquid milk has decreased years, market share of imported liquid milk has decreased and supply of liquid milk produced domestically has in and supply of liquid milk produced domestically has in- -creased, supplying liquid milk almost 100 percent domes creased, supplying liquid milk almost 100 percent domes- -tically.

tically.

APU Company introduced “Tsever suu” brand to the market APU Company introduced “Tsever suu” brand to the market in 2006, and began to take up growing share in the market in 2006, and began to take up growing share in the market upon the launch of its new dairy plant in 2014. By producing upon the launch of its new dairy plant in 2014. By producing a total of 32 kinds of dairy products, our company covers 24 a total of 32 kinds of dairy products, our company covers 24 percent of milk market and 19 percent of yoghurt and tarag percent of milk market and 19 percent of yoghurt and tarag market of Mongolia as of 2016.

market of Mongolia as of 2016.

APU Company introduced “Tsever suu” brand to the market APU Company introduced “Tsever suu” brand to the market in 2006, and began to take up majority share in the market in 2006, and began to take up majority share in the market upon its launch of new dairy plant in 2014. By producing a upon its launch of new dairy plant in 2014. By producing a total of 32 kinds of dairy products, our company covers 24 total of 32 kinds of dairy products, our company covers 24 percent of milk market and 19 percent of yoghurt and tarag percent of milk market and 19 percent of yoghurt and tarag market of Mongolia as of 2016.

market of Mongolia as of 2016.

The growth of vodka market is still globally stagnant The growth of vodka market is still globally stagnant due to economic conditions and consumers’ con due to economic conditions and consumers’ con- -sumption changes.

sumption changes.

This global change also affects the Mongolian vodka This global change also affects the Mongolian vodka market. In 2016, Mongolian vodka market reached market. In 2016, Mongolian vodka market reached 24.41 million liters, declining by 1.3 percent as com 24.41 million liters, declining by 1.3 percent as com- -pared to that of the previous year and the percentage pared to that of the previous year and the percentage of market decline is expected to be stable. of market decline is expected to be stable. Mongolian consumers are likely to choose cheap or Mongolian consumers are likely to choose cheap or expensive vodka instead of medium priced ones in expensive vodka instead of medium priced ones in connection with the Mongolian economic situation, connection with the Mongolian economic situation, purchasing power of consumers and consumption purchasing power of consumers and consumption behavior.

behavior.

APU Company produced a total of 64 SKUs of 17 APU Company produced a total of 64 SKUs of 17 brands as of 2016, taking up 51 percent of the mar brands as of 2016, taking up 51 percent of the mar- -ket share.

ket share. BUSINESS ACTIVITIES

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23.

05

SALES SALES We deliver our products through over We deliver our products through over 70007000 wholesale and retail stores covering 21 wholesale and retail stores covering 21 prov- prov-inces, and export overseas while fully inces, and export overseas while fully ensur-ing product quality to the

ing product quality to the end customers. Weend customers. We promote responsible drinking to consumers promote responsible drinking to consumers and carry out our sales in accordance with and carry out our sales in accordance with

international and national laws. international and national laws.

04

QUALITY MANAGEMENT QUALITY MANAGEMENT We follow food safety and quality We follow food safety and quality management processes at all levels management processes at all levels from planning and R&D, receipt of from planning and R&D, receipt of rawraw

materials, production, sales, delivery materials, production, sales, delivery and storage of nished products. We and storage of nished products. We lead the industry’s initiatives to adopt lead the industry’s initiatives to adopt

eco-friendly operations. eco-friendly operations.

Financial Financial Net sales income: 208 MNT Net sales income: 208 MNT billion

billion

Tax payment: 127 MNT billion Tax payment: 127 MNT billion Total dividends: 742 MNT million Total dividends: 742 MNT million Resource consumption Resource consumption “Energy efcient” Asian model “Energy efcient” Asian model organization organization Water saving: 11,544m3 Water saving: 11,544m3 Steam and heat saving: 14.5% Steam and heat saving: 14.5% Human capital Human capital Total number of employees: 817 Total number of employees: 817 Employee support: 1,5 MNT Employee support: 1,5 MNT billion

billion

Number of foreign trainings: 46 Number of foreign trainings: 46 Number of domestic trainings: Number of domestic trainings: 346

346

5 factories and one fully 5 factories and one fully automatic warehouse which automatic warehouse which were built in were built in accordance withaccordance with International standards International standards SKU: 162 SKU: 162 Social initiatives Social initiatives Pure Tuul campaign Pure Tuul campaign Trafc safety video campaign Trafc safety video campaign “Hamag Mongol” campaign to “Hamag Mongol” campaign to preserve and promote preserve and promote Mongo-lian cultural heritage lian cultural heritage Awards Awards TOP-100 Company TOP-100 Company ALUFOIL TROPHY-2016, Award ALUFOIL TROPHY-2016, Award in the Marketing & in the Marketing & Design cate-Design cate-gory by closure gory by closure WORLD VODKA AWARDS-2016 WORLD VODKA AWARDS-2016 Arkhi Export Limited Edition Arkhi Export Limited Edition Vodka /Gold Winner/ Vodka /Gold Winner/ Chinggis Khan Vodka /Silver Chinggis Khan Vodka /Silver Winner/

Winner/

THE BEST ANNUAL REPORTING THE BEST ANNUAL REPORTING AWARD OF MONGOLIA AWARD OF MONGOLIA All factories are equipped with modern

All factories are equipped with modern technologies and equipment meeting technologies and equipment meeting International standards. We are proud International standards. We are proud to lead the industry in terms of saving to lead the industry in terms of saving energy, water and heat, as well as energy, water and heat, as well as reducing waste reducing waste COSTUMERS COSTUMERS

06

22.

APU CompanyAPU Company Annual report 2016Annual report 2016 Financial

Financial Shareholders’ equity, assets, Shareholders’ equity, assets, borrowing and investment borrowing and investment Natural resource Natural resource Water, energy, land and natural Water, energy, land and natural productivity productivity Human capital Human capital Employees, health and safety Employees, health and safety environment, code of conduct environment, code of conduct Manufactured Manufactured Buildings, properties and Buildings, properties and equip-ment ment Social Social Social communities Social communities Intellectual Intellectual

Brands, R&D, innovation, Brands, R&D, innovation, process-es and corporate reputation es and corporate reputation Due to our company is responsible

Due to our company is responsible

for food safety and high quality man

for food safety and high quality man-

-agement on all processes from plan

agement on all processes from plan-

-ning and R&D, a product to

ning and R&D, a product to receivingreceiving

raw materials, producing, sales, de

raw materials, producing, sales, de-

-livering and storing nished products,

livering and storing nished products,

we can lead our industry to running

eco-friendly operation. eco-friendly operation.

01

PLANNING PLANNING AND R&D AND R&D We aim to use

We aim to use global advanced technologies,global advanced technologies, know-how, global trends and innovation know-how, global trends and innovation prod-ucts in our market

ucts in our market research and developmentresearch and development adapting them to Mongolian conditions by our adapting them to Mongolian conditions by our

talented employees and engineers. talented employees and engineers.

02

SUPPLIERS SUPPLIERS We comply with sustainable We comply with sustainable opera-tion

tion standards and are certied forstandards and are certied for FSSC 22000:2010, ISO 9001:2008 FSSC 22000:2010, ISO 9001:2008 and 14001. Partnering with over 140 and 14001. Partnering with over 140 local and International suppliers, we local and International suppliers, we offer safe and high-quality products offer safe and high-quality products

to our customers. to our customers.

03

PRODUCTION PRODUCTION BUSINESS ACTIVITIES BUSINESS ACTIVITIES

(13)

25.

Annual report 2016 Annual report 2016 APU Company APU Company The foundation for APU’s brewing capaci

The foundation for APU’s brewing capaci- -ty was laid in 1927 with the help of Czech ty was laid in 1927 with the help of Czech specialists.

specialists.

Today, the company operates a Today, the company operates a state-of-the-art, fully automated brewery supplied the-art, fully automated brewery supplied by leading German manufacturers with a by leading German manufacturers with a capacity to produce 75 million liters of beer capacity to produce 75 million liters of beer per year, all fully in accordance with the per year, all fully in accordance with the 600-year old “Bavarian Beer Purity Law”. 600-year old “Bavarian Beer Purity Law”.

Bliss, fruity and low alcohol beer, was intro Bliss, fruity and low alcohol beer, was intro- -duced newly to

duced newly to the market within the objectivethe market within the objective of introducing the “New Wave” to the market in of introducing the “New Wave” to the market in 2016.

2016.

As the market leader, APU Company brings in As the market leader, APU Company brings in world trend innovations adapted to Mongolian world trend innovations adapted to Mongolian consumers’ needs. consumers’ needs.

Capacity to produce

75 million liters of

beer per year

APU soft drinks plant is equipped with au APU soft drinks plant is equipped with au- -tomated bottling, blowing and capping lines tomated bottling, blowing and capping lines manufactured by top Austrian, German and manufactured by top Austrian, German and Italian producers and is fully compliant with Italian producers and is fully compliant with European food safety standards. European food safety standards. The uniqueness of APU’s carbonated drinks The uniqueness of APU’s carbonated drinks comes from the extracts of indigenous ber comes from the extracts of indigenous ber- -ries and medicinal plants, including Rhodi ries and medicinal plants, including Rhodi- -ola, Rosaceae, Paeonia anomala and Lico ola, Rosaceae, Paeonia anomala and Lico- -rice. Combined with the purity of the water rice. Combined with the purity of the water ltered through 4-layer German Gruenbeck ltered through 4-layer German Gruenbeck technology gives, it provides for an unfor technology gives, it provides for an unfor- -gettable drinking experience. gettable drinking experience.

In collaboration with KRONES Company from In collaboration with KRONES Company from Germany, the PET bottling line project was im Germany, the PET bottling line project was im- -plemented in 2012, increasing 4 times the plant plemented in 2012, increasing 4 times the plant capacity. Our plant has two lines from Sigma capacity. Our plant has two lines from Sigma and Krones companies, of which Sigma line has and Krones companies, of which Sigma line has a capacity of producing 3000 bottled products a capacity of producing 3000 bottled products per hour in PET and bottles of 1.5 liter, 0.5 liter, per hour in PET and bottles of 1.5 liter, 0.5 liter, and 0.33 liter. Krones packing line has a capac and 0.33 liter. Krones packing line has a capac- -ity of producing 5500-12000 bottled products ity of producing 5500-12000 bottled products per hour depending on bottle volume and packs per hour depending on bottle volume and packs beer, water, soft drinks and juices in PET and beer, water, soft drinks and juices in PET and bottles of 0.5 liter, 1.0 liter, 1.5 liters, 2.0 liters, bottles of 0.5 liter, 1.0 liter, 1.5 liters, 2.0 liters, and 2.5 liters. and 2.5 liters.

The uniqueness of

APU’s carbonated

drinks comes from

the extracts of

indig-enous berries and

enous berries and

medicinal plants

BUSINESS ACTIVITIES

24.

In response to the stable increase in de In response to the stable increase in de- -mand for dairy products and juice in Cap mand for dairy products and juice in Cap- -ital city of Mongolia, APU company made ital city of Mongolia, APU company made an investment to build a fully automated an investment to build a fully automated dairy plant in 2014. The factory is compli dairy plant in 2014. The factory is compli- -ant with European Union milk pro¬cessing ant with European Union milk pro¬cessing factory standards with cutting-edge tech factory standards with cutting-edge tech- -nology and processing equipment from nology and processing equipment from GEA, Germany - a leading global producer GEA, Germany - a leading global producer of technology in dairy industry, as well as of technology in dairy industry, as well as Tetra Pak, Ecolean and Elopak lling lines Tetra Pak, Ecolean and Elopak lling lines from Sweden.

from Sweden.

The annual capacity is 45 million liters, and The annual capacity is 45 million liters, and the plant can process daily 150 tons of the plant can process daily 150 tons of fresh milk.

fresh milk.

Certied and meeting fully the ISO 22000 Certied and meeting fully the ISO 22000 standard of Food Safety Management sys standard of Food Safety Management sys- -tems, the dairy factory purchases fresh cow tems, the dairy factory purchases fresh cow milk from over 300 Mongolian farmers. milk from over 300 Mongolian farmers.

Starting April 2016, Maamuu brand is exported Starting April 2016, Maamuu brand is exported to Hong Kong market and is sold in Wellcome, to Hong Kong market and is sold in Wellcome, Park&shop and Vanguard chain stores. Park&shop and Vanguard chain stores. APU Company focuses on health and well-be APU Company focuses on health and well-be- -ing of consumers and product quality, and is the ing of consumers and product quality, and is the rst company, which analyzes approved antibi rst company, which analyzes approved antibi- -otics amount in raw milk in its own laboratory. otics amount in raw milk in its own laboratory. Our company aims for developing new and in Our company aims for developing new and in- -novative products that meet Mongolian con novative products that meet Mongolian con- -sumers’ needs fully. For this purpose, brands sumers’ needs fully. For this purpose, brands such as Maamuu, Deej, Sain and Tsever suu such as Maamuu, Deej, Sain and Tsever suu were produced and introduced to not only Mon were produced and introduced to not only Mon- -golian consumers but also to the world market. golian consumers but also to the world market.

The annual capacity

is 45 million liters,

and the plant can

process daily 150

tons of fresh milk.

Fully automated high quality equipment by Fully automated high quality equipment by leading German, Austrian and Italian man leading German, Austrian and Italian man- -ufacturers enables the plant to produce ufacturers enables the plant to produce 20 million liters per annum. Total bottling 20 million liters per annum. Total bottling capacity is 9 thousand bottles per hour. capacity is 9 thousand bottles per hour. Pure spirit, the main ingredient in vodka, is Pure spirit, the main ingredient in vodka, is dis¬tilled in-house from organic local wheat dis¬tilled in-house from organic local wheat using a state-of-the-art German technolo using a state-of-the-art German technolo- -gy. APU Company directs its brand devel gy. APU Company directs its brand devel-

-opment and innovation towards brand products opment and innovation towards brand products that meet consumers’ needs, demands and that meet consumers’ needs, demands and consumption features.

consumption features.

In 2009, APU company commissioned the “NA In 2009, APU company commissioned the “NA- -TUR-AGRO” spirit plant, which is fully equipped TUR-AGRO” spirit plant, which is fully equipped with advanced German technology and the with advanced German technology and the plant produces world-leading quality “Alpha” plant produces world-leading quality “Alpha” grade spirit, ensuring APU’s sustainable oper grade spirit, ensuring APU’s sustainable oper- -ations. ations.

Total bottling

capacity is

9 thousand

bottles per

hour.

(14)

27.

Adhering to standards, procedures, regulations, analy Adhering to standards, procedures, regulations, analy- -sis methodologies, normative technical documents and sis methodologies, normative technical documents and ISO/IEC 17025 standards approved by the international ISO/IEC 17025 standards approved by the international standardization organization, our certied laboratory is standardization organization, our certied laboratory is in charge of properly and accurately conducting senso in charge of properly and accurately conducting senso- -ry tests, microbiological, physical and chemical analyses ry tests, microbiological, physical and chemical analyses on primary and secondary raw materials, semi-processed on primary and secondary raw materials, semi-processed and nished products from all 5 production lines of APU and nished products from all 5 production lines of APU company in accordance with certications, and maintain company in accordance with certications, and maintain- -ing control over each technological stage to make sure the ing control over each technological stage to make sure the quality products meet standard requirements. The certied quality products meet standard requirements. The certied laboratory complies with general requirements on capacity laboratory complies with general requirements on capacity of international laboratories of MNS ISO-17025:2007 stan of international laboratories of MNS ISO-17025:2007 stan- -dard, and is equipped with high-sensibility equipment with dard, and is equipped with high-sensibility equipment with to-date nano-technology from leading international labora to-date nano-technology from leading international labora- -tory equipment suppliers from

tory equipment suppliers from USA, Germany, Austria, KoreaUSA, Germany, Austria, Korea and Russia.

and Russia.

Besides maintaining internal control over productions, our Besides maintaining internal control over productions, our laboratory is the major research base that cooperates with laboratory is the major research base that cooperates with VLB and Weihenstephan Institute from Germany, Interlab VLB and Weihenstephan Institute from Germany, Interlab and FGNBU VNIIPBT Institute from Russia, Mongolian re and FGNBU VNIIPBT Institute from Russia, Mongolian re- -search institutes and universities in re-search areas. search institutes and universities in research areas. Internal control laboratory of APU Company adheres to the Internal control laboratory of APU Company adheres to the following policy:

following policy: •

• To To comply with comply with IEC/ISO IEC/ISO 17025 standards 17025 standards on laboratoon laborato- -ry quality management systems and ensure constant ry quality management systems and ensure constant improvement.

improvement. •

• To To continually invest continually invest into into staff staff development, development, equipmentequipment and technology improvement, and ensure consumer and technology improvement, and ensure consumer satisfaction.

satisfaction. •

• To To maintain maintain independence independence and and autonomy.autonomy.

Our distinctive features are:

•

• Compliant Compliant with with international international ISO ISO standardsstandards •

• Employs Employs food food safety safety and and technology expertise technology expertise teamsteams •

• Unied Unied quality quality management management systemsystem •

• Full Full compliance compliance with with legal legal requirementsrequirements •

• Maintains Maintains process-based process-based quality quality monitoring monitoring control.control.

BUSINESS ACTIVITIES

26.

26. QUALITY CONTROL

QUALITY CONTROL

APU company is the rst Mongolian company that APU company is the rst Mongolian company that introduced the ISO 9001 Quality management sys introduced the ISO 9001 Quality management sys- -tem, ISO 14001 Environmental management sys tem, ISO 14001 Environmental management sys- -tem, and FSSC 22000 Food safety management tem, and FSSC 22000 Food safety management system together. Our Quality management and con system together. Our Quality management and con- -trol department is responsible for conducting tests, trol department is responsible for conducting tests, analyzes, experiments, quality control and verica analyzes, experiments, quality control and verica- -tion, and monitoring on all processes from designing tion, and monitoring on all processes from designing a product to receiving and inspecting raw materials, a product to receiving and inspecting raw materials, storing, producing and distributing nished prod storing, producing and distributing nished prod- -ucts.

ucts.

To provide customers To provide customers with premium quality with premium quality products and services products and services that fully comply with that fully comply with legal requirements, legal requirements, consumer expecta consumer expecta- -tions and food safety tions and food safety standards. standards.

To develop all stages To develop all stages of food production in of food production in line with FSSC22000: line with FSSC22000: 2010 and ISO 2010 and ISO 9001:2008 standard 9001:2008 standard requirements and requirements and maintain constant maintain constant improvement. improvement. To become the To become the leading beverage leading beverage producer through in producer through in- -vestment into human vestment into human resource develop resource develop- -ment, equipment and ment, equipment and technology. technology. To verify results by To verify results by conducting internal conducting internal and external audits and external audits on food safety and on food safety and quality management quality management systems. systems.