Annual Report 2018: Delivering on Our Strategy

March 21, 2019

Looking back on 2018, we have every reason to be proud of our performance. It demonstrates our ability to deliver on our promises and confirms we are in a good position to drive our next phase of growth.


In my many years with the Group, I have seen several chapters of Louis Dreyfus Company’s (LDC) journey unfold – none more exciting than the one that lies ahead. We have a clear roadmap, with a solid strategy to capture the attractive opportunities we see developing within our sector, and are set to consolidate our position as a key player for the long term.

Our ambitions and actions will be guided by our company purpose to create fair and sustainable value, while LDC’s capacity for innovation and entrepreneurship will remain essential to our success.

Reflections on 2018

We delivered very good results for 2018, supported by a strong second half of the year, as expected. During the year, we also completed the divestment of 2 non-core businesses, continued to invest in core areas and successfully navigated a challenging market environment.

In early 2018, we closed the sale of our global Metals business and our Fertilizers & Inputs activities in Australia. This reflects the continued refocus of our business, aiming to set the right financial and operational conditions to deliver our long-term strategy. The announcement of our decision to end our Dairy activities by the end of the first half of 2019 is another step in that direction.

Overall, our operating results for 2018 were up 26% year-on-year at US$1,330 million, while our net income, Group share, rose 12% to US$355 million, despite lower sales and volumes due to divestments. These results were achieved thanks to our globally diversified portfolio and geographic footprint, together with active risk management, and demonstrate our ability to rise to the challenges of different trends among our business platforms and the fallout from US-China trade tensions.

Our Value Chain Segment’s Operating Results increased by 16% compared to 2017 thanks to strong performances, particularly in Oilseeds. The Platform’s approach illustrates LDC’s agile response to events, by shifting physical flows, implementing the right hedging strategies and leveraging investments at destination, to respond to demand. Our Merchandizing Segment’s Operating Results soared 46% versus 2017, with sales broadly flat, and Cotton and Sugar leading the way.

At the same time, we pursued our strategic investments for growth, acquiring an oilseeds crushing plant in Tianjin, China, expanding our logistics networks in the Black Sea and South America, and making our first investments in food innovation.

Our results and achievements in 2018 confirm my view that we have the right strategy to write a new and successful growth chapter for LDC.

Becoming the value chain

For a company like ours, a high degree of integration across the value chain has become fundamental. While this works slightly differently from one platform to another, it is clear that our margins lie across the full spectrum from producer to end consumer. It is our ability to seamlessly master and connect each step along the way that will allow us to create and leverage opportunities, and to mitigate risk over time. Finding the right breadth and balance of origination and destination markets also remains key in providing the necessary flexibility.

Our ambitions require that we focus on our customer-centric approach, maintaining a state-of-the-art logistics network, investing in our research and analysis capabilities, moving further downstream toward end-consumers, and nurturing our capacity for innovation across the organization.

Becoming the value chain is also essential to ensure that sustainability and traceability – which are mandatory today – are an integral part of doing business. The more integrated our supply chain, the higher our level of control.

Our focus on sustainability calls for continued action and ultimately greater impact on several key areas:

  • Safety, health and environment (SHE) limiting our energy and water usage, greenhouse gas emissions and waste generation, while continuing to strive for a zero-incident environment.
  • Applying and expanding, where necessary, our policy frameworks for local action and partnerships – for example our “No Deforestation, No Peat, No Exploitation” efforts in palm, our new Soy Sustainability Policy and efforts to eradicate child labor from our supply chains.
  • Collaborating with and influencing global stakeholders to improve practices – for example, our work with the World Business Council for Sustainable Development, the Sustainable Shipping Initiative and the International Labour Organization.
  • Supporting local communities – driving economic development and improving quality of life in the communities where we operate, by creating jobs and through various programs to develop sustainable agriculture, food security and access to education, equipment and financing.

With our commitment to becoming the value chain, LDC sees commercial success intrinsically linked with the creation of fair and sustainable value, exactly as our purpose envisions.

The next chapter

As the well-known adage goes, successful companies are those that recognize and adapt to change. The next 5 years will see LDC become the value chain and evolve to become more of a diversified food and nutrition company.

Our strategy, which is laid out in more detail in the following section of this report, is built around 4 pillars that will steer LDC into the near future:

  • Strengthening our edge in trading, honing this core activity for LDC, in which we will continue to lead and prove our depth of talent.
  • Integrating vertically, moving up- and downstream as appropriate to each of our business lines.
  • Diversifying revenue streams through value-added products, building outwards from our existing activities or forming partnerships and JVs to complement our capabilities.
  • Innovating to remain a key industry player for the long term, leveraging new or disruptive innovations in technology, food or other areas related to our value chain.

If the history of LDC shows us anything, it is that our expertise, entrepreneurship and flexibility in adapting to change have been at the heart of our success for more than 168 years.

I am confident that the next 5 years will provide another growth chapter of that history, as we rise to the challenge of sustainably feeding a growing world population.

The complete 2018 Annual Report and Audited Consolidated Financial Statements are available at

To read the Press Release on the Financial Results go to:

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