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Balance Sheet 2020: Tönnies is market leader for organic meat

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Balance Sheet 2020: Tönnies is market leader for organic meat

+17% growth for international locations // successful growth in first half of 2020 // Corona closure impacts plant in Gütersloh District

Rheda-Wiedenbrück, 1. April 2021 – The Tönnies group of companies developed stably in 2020 despite the restrictions caused by the corona. After a strong first half, the balance sheet for the second half of the year was, as expected, weaker. The corona-related closure of the plant in Rheda had an impact. Nevertheless, the company can look back positively on the year as a whole.

Clemens Tönnies, Managing Partner of the international group of companies sums up the year as follows: “The corona year 2020 was the biggest challenge in the history of our company and its employees. Whereas at the onset of the Corona pandemic in the first half of the year we were asked by the politicians to produce more and fill the supermarket shelves for the lockdown, the four-week plant shutdown in Rheda and subsequent production cutbacks due to the outbreak, which the employers’ liability insurance association now classifies as an industrial accident, negatively affected the Rheda balance sheet.”

Despite this localised phenomenon, Tönnies is satisfied with the balance sheet of the entire Group. “Our company consists of 29 production sites worldwide, 28 of which had a decent year,” says Clemens Tönnies. With the Corona prevention measures it has introduced, Tönnies is regarded worldwide as a blueprint for prevention in the food industry.

In 2020 the company recorded, internationally, annual sales of around 7.05 billion euros (- 3% compared to 2019). The stagnation is mainly due to the significantly lower pig price (on average 9.3% lower than in 2019) and the four-week plant shutdown at the Rheda site.

Changes in the pig market

The pig market had a real shake up last year, especially as a result of the gastro-lockdown. The export ban on pork to third countries due to the African swine fever in Germany also severely restricted exports. The price per kilogram of carcass weight varied between 2.02 euros and 1.19 euros last year, which naturally had a significant impact on the company’s sales.

“We need stable and adequate prices for agricultural producers in the long term, higher than in the last quarter,” says Dr. Wilhelm Jaeger, head of the Agriculture Division. “If we want to maintain agricultural production in Germany in the future, we need the acceptance of society at large. That’s why we are committed to the goals of Agriculture Minister Julia Klöckner’s Borchert Commission,” said Jaeger. “We have almost achieved our goal of establishing Husbandry System 2 as the standard in supermarkets. The starting date is June 2021.”

The organic market is growing

At the same time Tönnies is continuing to invest in open-front stables and the organic market. “We can see good growth potential in the organic segment, where we are already the market leader. If consumers demand more organic products as a result of a change in thinking, then we will deliver.”

In total, Tönnies processed 16.3 million pigs (-2%) at its German sites, with the decline related exclusively to the 4-week closure of the Rheda-Wiedenbrück site in Eastern Westphalia and the subsequent reduction in production. The company grew strongly at its other locations, particularly abroad. 4.5 million pigs were processed in Denmark, Spain, Great Britain and Poland (+17%).

Beef division: start-up of new Badbergen plant

The development in beef is particularly pleasing. The new Beef Competence Center in Badbergen has started production. Here, too, Tönnies is consistently implementing its concept of slaughtering and producing meat as a single biological unit. Demand for beef has grown steadily in recent years. “Our investments of around 85 million euros in the Badbergen Beef Competence Center are now paying off for the first time. The quality is top,” reports Ulrich Steinemann, managing director of the beef division. “We are bundling our volumes at a highly specialized, digitized plant which is setting standards worldwide. The automation rate is extremely high, so that fewer than 500 employees at the plant are able to carry the company.”

Even though the ongoing gastro-lockdown is impacting sales throughout Europe, burger patty production at the new Badbergen site is running successfully. As Tönnies supplies the cattle segment, especially in the foodservice sector, to European countries such as France and Great Britain, which are also affected by the lockdown, the division did not achieve any growth in 2020. At its German sites Tönnies processed a total of 420,000 cattle, including cutting. This is 4% less than in the previous year.

International growth at foreign locations

Internationally, Tönnies is pursuing its growth strategy in a very consistent manner. Investments in Great Britain, Denmark, France, Spain and Poland amounted to a three-digit million euros sum. In the UK alone, Tönnies is investing 25 million euros in its locations. With sales of over 500 million euros, Tönnies is the market leader there in numerous segments. “The British market is a growth market for us. We want to serve the growing consumer demand there with our quality meat,” says Frank Duffe, Tönnies international board member.

From an economic point of view, the production plants in Denmark, France and Poland are also developing very positively. In Spain, a letter of intent was signed for the construction of our own slaughterhouse in the Aragon region. In China, the foundation stone for the joint venture with the Chinese Dekon Group was laid a few weeks ago.

The veggie market is growing

Tönnies is also pressing forward with its growth course in the market for vegetarian and vegan meat substitute products. The company has bundled its activities in this segment with the consumer brands “es schmeckt,” “Vevia” and “Gutfried veggie” in an independent business unit of Vevia 4 You GmbH & Co. KG and an independent production plant in Böklund.

“Last year, we set up our own plant for vegetarian and vegan products at our headquarters in Böklund,” reports Maximilian Tönnies. “We are now expanding this capacity further and doubling the production area, since consumer demand and confidence in the products are growing sustainably.” Interest in vegetarian and vegan products has been growing for years. “We don’t see the production of vegetarian and vegan foods as competition for our meat products but as a market segment in its own right and as an excellent addition to our already very broad product portfolio,” emphasizes Maximilian Tönnies. “It was important to us to take the next step of an independent, separate production under the most stringent hygienic requirements. This is part of our sustainability agenda t30, with which we are sustainably developing the entire group of companies.”

Generation transition in full swing

With the t30 sustainability agenda adopted in 2019, the company is in the full process of developing into the most sustainable food company in the industry.
In addition to heading the zur Mühlen Group division, Maximilian Tönnies (30) is taking on more and more responsibility in the Group as a whole. “I am delighted that the transition to the next generation is in full swing,” says Clemens Tönnies (64). “Max is moving into the next generation along with our highly motivated management team.”

Press information

Fake Tönnies e-mails in circulation

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Fake Tönnies e-mails in circulation

Rheda-Wiedenbrück, September 7th, 2020 – The Tönnies group is currently struggling with fake emails. Strangers are sending out deceptively real-looking messages on behalf of the company that supposedly come from the company. The people behind this campaign try to persuade customers to make payments or to place malware on the recipient’s computers. The Tönnies legal department therefore urges caution:
Dear Sir or Madam, dear customers,
we ask for urgent attention: Currently, there are a large number of fake e-mails in circulation that ostensibly originate from our company. Attempts are being made to induce customers to make payments and/or install malware or spyware on the recipient’s system.
We would like to make an appeal to ensure that you do not open the attachments of the e-mails under any circumstances and that you delete the e-mails immediately. If there is even the slightest doubt about the authenticity of the e-mail or the sender, please contact your known contact person from our company immediately. Please do not make any payments in this case.
The following fake senders are currently known: Mr. Robert Marx (“Senior Sales Representative”), e-mail address: [email protected]
We ask for increased vigilance. If you have any questions, please do not hesitate to contact us at any time.

Immediate Action Plan

Tönnies implements Immediate Action Plan

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Tönnies implements Immediate Action Plan

+++ The site at Rheda-Wiedenbrück is being reopened following significant technical innovations and additional hygiene measures
+++ The 25 immediate actions implemented by Tönnies include restructuring the living and working areas for the current contract workers as well as the animal husbandry area.

Rheda-Wiedenbrück, 20 July 2020 – The Tönnies Group has gradually reopened the production areas at Rheda-Wiedenbrück. Following a series of tests, the municipal administration of Rheda-Wiedenbrück lifted the production ban for slaughtering and butchering last Friday. Since then, production has restarted; initially approx. 8,000 pigs were slaughtered each day.
The basis for the reopening is an expanded hygiene plan. This was further defined with experts from the district administration, the occupational health and safety authority for the region of NRW along with other scientific experts, and was reviewed during visits and tests at the plant.
The hygiene plan used as the basis for reopening the site focusses on new ventilation installations, decentralised HEPA filtration devices, which have been installed in the butchering areas. They exchange the air 2.5 times per hour and reduce the potential viruses in the air circulating within the room. The filter installations were put into operation over the last few weeks and checked in tests carried out with the authorities.
Immediately after the outbreak, Prof. Dr. Martin Exner from the Institute for Hygiene and Public Health at the University of Bonn pointed out that the air circulating within the butchering area is the main reason for the virus being able to spread into some areas and cause a mass outbreak. The findings are new, this was previously not regulated and has now been scientifically investigated for the first time. They explain for the first time why large-scale infections occur in abattoirs around the world.
The expanded hygiene plan also includes weekly mass testing for all production employees in mobile tents at the plant entrance, address management of all employees for company tracking of employees, a strict separation of employees from different production departments during canteen visits, an increased number of training sessions for employees and also increased checks of compliance with distance rules and wearing of medical face masks to be carried out by the Corona Officers who will carry out patrols.
Tönnies will implement these and other measures at the sites at high financial and personnel cost and with the cooperation of employees from production and administration.

Living and working
By 01 September 2020, Tönnies will directly employ 1,000 contract employees in Rheda-Wiedenbrück. By the end of 2020, the goal is that all employees in core areas will be employed directly by the company. Tönnies will create new accommodation for these employees – initially at Rheda-Wiedenbrück, then at other sites if required. By 01 September 2020, Tönnies will rent approx. 400 residence units in Rheda-Wiedenbrück for future employees. Two housing management companies have been established and are currently working on this task under high pressure. The time recording system previously available will be transferred to a digital time management system from 01 August 2020 with the aim of reviewing and documenting working times in a more efficient way.
“We are developing our company for the future. The Immediate Action Plan is the start. It determines how we hire the contract employees as direct employees, build new accommodation for them, improve the existing accommodation and ensure that we protect our employees during the pandemic so that we can continue to produce high-quality meat and sausage products”, says Clemens Tönnies.
 
Animal husbandry
For many years, the Tönnies Group has been a pioneer in issues of animal welfare, the farming label and transparency for the consumer with regard to farming conditions. With the Immediate Action Plan, the Tönnies Group continues to follow this path: it acknowledges the result of the Borchert Commission of the Federal Ministry for Agriculture and supports the animal welfare levy. Tönnies also pursues the goal of switching to farming method 2 (“indoors plus”) for most pork production in the future, and is expanding the offer for farming method 3 (“Outdoor”) to 3,000 pigs/week and supporting the construction of open-front stalls.
The measures included in the Immediate Action Plan are initially being implemented at Rheda-Wiedenbrück. Following this, selected measures required during the pandemic will be introduced at the other German sites. In doing so, the structuring of the measures to suit other sites is dependent on the valid rules and regulations, the circumstances and space at the sites, as well as the infection rate in the regions of the other sites and the associated regulations from the authorities during the pandemic.

Tönnies Holding and the Dekon Group

Tönnies launches joint venture in China

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Tönnies launches joint venture in China

Tönnies Holding and the Dekon Group are launching a joint venture for a slaughter and butchering centre in the Sichuan region +++ Signing of the memorandum of understanding at the Western China International Fair +++ Total investment of around EUR 500 mill.  
Rheda-Wiedenbrück/ Sichuan, 27/09/2019 – The Tönnies Group continues to further their internationalisation strategy and is setting up the first production location outside of Europe. Together with the Dekon Group, a subsidiary of the West Hope Group, Tönnies is now signing a memorandum of understanding for a slaughter and butchering centre in the Sichuan region, initially for two million pigs, which will be run as a joint venture. In a second phase, this will be expanded to six million pigs.
“We are proud to be starting a new chapter in our company history together with our partner, the Dekon Group” explained Tönnies CEO, Andres Ruff, during the signing at the Western China International Fair. “With our competence in the slaughter and butchering of pigs and our knowledge of the prerequisites, safety and hygiene in food production, we can further consolidate pork production for the Chinese market.”
The two partners will set up a new abattoir and associated butchering business for pork in the Sichuan region. The abattoir is designed for approx. two million pigs and is constructed according to the model of the Tönnies businesses in Germany. The total investment amounts to EUR 500 million, of which around EUR 150 million is accounted for by the slaughter and cutting centre.
“In Sichuan, the first plant is being constructed in compliance with the European standard for pork products. From breeding to slaughtering to processing, we will achieve complete integration in food production,” said Wang Degen, CEO of the Dekon Group, after the signing.
“The demand for pork in China and many other Asian countries is great and will continue to grow in the coming decades”, said Clemens Tönnies, Managing Partner of Tönnies Holding. “This joint venture is the next step in our internationalisation. We are bringing our knowledge of food production based on German standards to the world and strengthening the quality and safety of the supply in China.”
The Chinese food market is currently in a state of transition. African swine fever has culled stocks in parts of the country. Micro-businesses and backyard farms are now being replaced by agricultural companies whose biosafety corresponds to western-European standards. “We want to make use the spirit of optimism in China and produce quality meat for the Chinese market” explained Ruff with regard to the market. 
By signing the official memorandum of understanding, both companies want to start the joint venture now. The foundation stone for the production location is due to be laid in 2020. 
About Tönnies Tönnies is a multi-tier company in the food industry and is active around the world. With production locations in Germany, Great Britain, France, Spain and Poland, the company is split into eight divisions: Meat Pork, Meat Beef, Convenience, Sausages, Ingredients, International, Logistics and Central Services. The core business of the company, which was established in 1971, concerns the processing and refining of pigs, sows and cattle. 
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