Chief Executive Officer’s Message

This year, we began the next chapter of our journey as FrieslandCampina Engro Pakistan. A journey with a very clear Purpose:

“We Will Transform The Health And Wellbeing of Pakistani’s, Now And For Generations To Come, By Nourishing Them Through Unlocking the Goodness of Milk From Glass to Grass, as Well As By Enhancing The Livelihood Of Farmers”

We are committed to playing a key role in fulfilling the nutritional needs of Pakistanis, and in developing the Dairy sector in Pakistan, thereby increasing the income of farmers, and alleviating poverty amongst our rural population.

As part of a global, Dairy powerhouse with a unique heritage of over 140 years as a Cooperative, we now have the opportunity, technology, knowledge and methodologies to bring about an unprecedented transformation in Pakistan’s Dairy industry.

2019 was a challenging year for our company, our industry, our economy and our country. Everyone, from consumers to businesses, felt the inflationary impact of a volatile exchange rate, in the wake of the rupee devaluation. As a business with many moving parts, we had to adjust our methods, expectations, and efforts.

Amidst a bleak environment, there were many wins to recognise and celebrate:

• Olper’s maintained market leadership with a 45􀀀 share - A 815 BPS growth in comparison to January 2018. Loppers also achieved its highest sales in a single year
• Tarang achieved market leadership at 22.9􀀀 market share, with a 537 BPS growth since its relaunch in Feb 2018.
• We successfully launched Olper’s Full Cream Milk Powder (FCMP), which is steadily moving ahead with an already impressive market share.
• Despite a slow start to the year, Omoré delivered double digit growth aided by 8 stellar innovations and expansion of retail footprint.

The circumstances of these accomplishments makes them all the more extraordinary.

Our human capital investments emphasized programs to attract, train and develop talent to ensure the right mix of people, projects and culture. In our 2019 Employee Engagement Survey, covering a workforce of 1200+ employees, 80%+ of our employees reported feeling proud of our open and collaborative culture.

On the development front, our goal was to offer more personalized capability plans, for divisions to develop talent for future leadership positions. One of our global-driven initiatives focused on our young professionals through our “Learn to Grow” program, while our leaders focused on identifying and growing talent, through the global “Nourishing Leadership” initiative.

2019 has underscored the need for a vibrant and collaborative team to carry us forward to greater heights. Equally, it has highlighted the need for us to remain agile in an unpredictable environment, and to adapt to a changing Dairy, economic and political landscape - while remaining fully committed to our long term Purpose.

I have great confidence in our team’s ability to respond with speed and resolve, and convert market situations into opportunities

We go into 2020 with momentum. We continue to be excited by the immense opportunity of the Pakistan Dairy market, where less than 10% of milk consumed is packaged, and therefore lacks nutrition and is unsafe. We will continue to advocate the consumption of nutritious, safe, packaged milk, and work towards our goal by supporting efforts to make the public aware of the facts around Dairy consumption, by working with Government to enact and enforce legislation to ensure quality Dairy products, and by making the right products affordable and accessible to Pakistanis.

With the right mindset we are confident we will see many wins. We have strong fundamentals, a comprehensive strategy, sustainable competitive advantages, a robust team, vibrant operations, and a future brimming with potential. Together, we will transform Pakistan’s Dairy landscape.

Ali Ahmed Khan

Chief Executive Officer