Page 61 - flipbook-ubp-IR

CORPORATE FINANCIAL GOVERNANCE STATEMENTS
THE LEMONADE STAND
Companies
The lemons and impacts
Solutions and lessons learned
The Group
UBP
Premix
Drymix
Espace Maison
Gros Cailloux
• Climate-related risks are integrated in our risk management framework.
• Skills transfer gap is being addressed with a proper talent management and learning and development strategy.
• The remaining staff walked and worked the extra mile to ensure the smooth running of the operations.
• Production objectives were delivered despite the increased costs arising from the technical issues.
• The communication campaign, which was due for launch after the revamp of our product and packaging, was delayed until March as a result of supply chain issues.
• We increased the number of suppliers from two to eight to enhance our resilience, and we flew in urgent additives to ensure uninterrupted production.
• After the first wave of the pandemic, we had anticipated the supply chain issues and strategically pre-ordered most of our products. Coupled with employees’ can-do attitude and our moto ‘Not why, but why not?’, Espace Maison delivered an exceptional performance in terms of revenue and profitability.
• The increased costs of resources and logistics disruptions have burdened all our companies, negatively impacting our overall profitability. These issues are likely to persist during the coming years.
• We have learned to leverage the negotiating power of the Group to secure better deals. In parallel, each company devised its own strategy to handle these logistical challenges. While some entities chose to airfreight materials, others shifted their stocking strategies.
• Resource scarcity and logistical constraints are likely to remain a dominant issue in the years to come. Our aim is to continue building resilience and autonomy by increasing our pool of suppliers, diversifying their origins and whenever possible, increasing local sourcing. Although we absorbed most of the financial burden at the expense of profitability, certain costs were incurred by our customers.
• The bad weather prevailing during the first quarter impacted our operations and level of activities.
• It is an ongoing challenge to attract and retain younger skilled labour and transfer skills from an ageing workforce.
• The integration of the company within the Group has led to the evolution of our business model, while also impacting multiple functions in the company, namely, management, IT and communication.
• An integration plan and a communication strategy were devised to address and manage any arising issues.
• An ad hoc steering committee was set up to lead the integration plan. The teamwork and concerted efforts of the committee proved to be fruitful.
• The impacts of Covid-19 led to a high absenteeism rate, disrupting HR operations during the year.
• The new equipment installed in January is already bringing a measurable improvement on the production output. However, the installation took longer than expected due to unanticipated technical issues.
• Worldwide logistics disruptions resulted in multiple supply chain issues and stock forecasts.
• Like all businesses in the Group, the worldwide logistics and supply chain issues disrupted our operations, generating additional work and strain for our employees.
• The need to secure stock in case of supply chain issues significantly impacted our cash-flow.
• Being highly dependent on imports, we were particularly impacted by the scarcity and rising exchange rates of foreign currencies.
• The summer rains were delayed, causing a disruption in the planting of potatoes and onions. Given our time constraints to adequately prepare the fields, we hired external services to ensure the timely completion of the fieldwork.
• As the impacts of climate change become more significant and frequent, they must be factored in our operational strategy.
• We intend to constantly research new planting techniques and ensure the adaptability of plants to changing climatic conditions, including vegetables. For instance, our tomato cultivation was relocated to a shaded area on site.
UBP INTEGRATED REPORT 2022 59
OUR PERFORMANCE