Profile

 

In the following, you can read more about:

 

- The background for establishing DPL-Invest A/S
- DPL´s concept – financing model
- DPL´s concept – management model
- The structure of the production companies
- DPL´s organisation
- DPL´s staff policy

 

Background

 

The reason for establishing an alternative financing concept in 1989 was the strong specialisation and structure development that increased pig producers’ need for capital significantly. This situation made it difficult to establish or take over properties specialising in pig production. It was often impossible to obtain sufficient funds to establish efficient production units.

DPL was founded in 1990 through a merger of Østergaard Svineproduktion A/S and Finansieringsinstituttet for Svineproduktion A/S.

DPL’s objective was to provide “patient” capital for the Danish pig production industry in order to ensure continued growth in Denmark’s largest export trade.

On the one hand, the starting point for DPL was to establish a financing company capable of participating in pig production on an ownership basis.

On the other hand, the return in booming periods was to provide the shareholders with a total return above the market rate of interest.

Furthermore, it was also to be made possible, through DPL, to obtain economies of scale for both the company as a whole and for the individual project participants in order to optimise total earnings.

 

DPL’s concept.

 

DPL’s financing model

 

In order to fulfil the objective of an alternative financing model, the establishment of DPL in 1989 made it possible for the Danish pig sector to use DPL’s financing model.

According to this model, the farmer usually owns the land, farmhouse and existing buildings. DPL participates in the production company that owns the stock, fixtures and equipment, etc. The ownership of new carcasses may vary. They are often owned by the farmer who leases them to the production company but in several cases the production company owns these new buildings.

 

 

 

 

 

Financing model where the production company invests in the buildings.

 

 

 

                                    Financing model where the production

Farmer-   owned   100%

Land   Farmhouse

Stock   Fixtures and equipment   Working capital   Pig houses

Production company   The farmer 20-49%   DPL-Invest A/S 51-80%

 

The agreements entered into with the farmer in connection with the establishment of the production companies decide how much the individual production companies invest in the layout of the leased premises, production buildings, fixtures and operating equipment. The basis for determining the scope of investment for the production facilities of the individual production companies is the statutory approvals obtained for production of pigs by the individual locations and properties.

 

DPL’s management of the production companies

 

Knowledge, including experience, acquired in the individual production companies within the DPL Group is used in a targeted and active manner to the benefit of the other production companies and thus to the benefit of the DPL Group as a whole. The knowledge is exchanged both at an operational level through DPL’s Key Project Management team (”KPM team”) and at a higher management level through the work of the supervisory boards of the individual production companies.

 

DPL’s cooperative partners

 

The cooperative partner is important for DPL when establishing and operating a production company.

DPL’s financing model appeals to a wide range of pig producers. The farmers who have established projects in cooperation with DPL at this point have had different reasons for doing so.

 

 

Production

 

Production companies

 

So far, 27 production companies have been established. In 10 of these companies, DPL has subsequently sold its owner share to the farmer. So today, DPL owns or co-owns 17 production companies.

Geographical location of production companies

 

With the exception of Funen and Bornholm, DPL’s production companies are scattered all over Denmark. Locally, efforts have been made to locate production facilities taking the environment into account.

 

The production concept

 

All production companies established before 1 January 1995 were organised as intensive, integrated production units with sows, piglets up to 30 kg and finishers, if any, in the same building.

All production companies established after 1 January 1995 are organised according to the Multisite concept with sows in one locality (property), 7-30 kg piglets in another locality and 30-100 kg finishers, if any, at a third locality.

Two of DPL’s production companies established before 1995 have changed to the Multisite system in connection with expansion activities. After 1 January 1995, all production companies were also established with gestation units for loose sows.

The Multisite solution required a change in operations management but production in several localities has proved very efficient as a health control measure, thus ensuring high production reliability.

 

 

Organisation

 

In order to benefit more from DPL's economies of scale, management decided in 2005 to centralise several functions previously handled decentrally. This primarily involved a number of administrative tasks such as payments, bookkeeping, payment of wages, etc.

In addition, purchasing of feed, etc. was to a great extent established as a function under the central management in Silkeborg.

For a number of companies, the overall day-to-day management was gathered under a single person.

At the same time, the ongoing reporting activities regarding production conditions and finances were intensified and are now carried out on a weekly and monthly basis, respectively, and not on a quarterly basis as before. Board meetings are held in the companies every three months to follow up on closed quarterly financial statements.

All this has resulted in closer cooperation between the operations management of the companies and the centralised management of DPL-Invest A/S.

 

Organisations planen indsættes her

 

 

Employees

 

The DPL Group has a total of 130-140 employees. Approx. half the employees are of foreign, primarily eastern European origin.

So-called ERFA meetings (exchange of experience) are held regularly to strengthen the internal bonds in the Group.

The operations managers meet every two months to exchange experience regarding production and to benchmark the individual companies’ financial key figures.

Furthermore, 2-3 annual ERFA meetings are held for Danish as well as foreign employees. The meetings are held as farm visits followed by social gatherings.

In addition to the fruitful exchange of experience, the social aspect of these ERFA meetings are also important to DPL-Invest A/S.

The working conditions of all the employees of the DPL Group are good and they are all covered by pension schemes.