ANNUAL REPORT 2003 INEX PARTNERS OY

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FINNFROST OY Finnfrost Oy provides purchasing and logistics services related to frozen food for the retail trade and for the hotel, restaurant and catering sector. Ownership of the company is split 50–50 between Inex Partners Oy and Tuko Logistics Oy. Frozen food consumption increased in Finland, but the growth rate and the overall development of the frozen food market remained under the EU average. Ice-cream consumption, which rose sharply in 2002, took a downward trend in 2003 both in Finland and the rest of Europe. As a result of the good performances of our clientele within the grocery market, growth in Finnfrost’s frozen food and ice-cream sales outperformed the industry average. Finnfrost’s product range was further diversifi ed and expanded, the number of products increasing by 7 per cent. The company purchases frozen food products from a larger number of suppliers than before, and the number of suppliers on the market also continued to grow. Moreover, several new foreign partners joined Finnfrost’s network. With respect to the company’s various product groups, meat and poultry and food products saw the most vigorous growth while the largest product group was frozen bakery products. In the Finnfrost logistics centre situated in Jussla, Tuusula, operations became established and effi ciency improved in all sectors. We had also a major role in improving our customers’ competitiveness in frozen food and ice-cream sales. Marked growth in Finnfrost’s product range made it necessary to extend the Jussla logistics centre, which will be completed in May 2004. The extension will increase Finnfrost’s competitive superiority, enabling the company to realise product range solutions defi ned in its clientele’s competitive strategies. It also enables the company to take full advantage of the increasing supply following from EU enlargement. Finnfrost’s quality management system has been awarded the Lloyd’s Register Quality Assurance ISO 9001: 2000 certifi cate. The application area of this system is the purchasing and logistics related to frozen food and ice-cream. Information systems were improved by acquiring a new production control system for the warehouse. Other investments were replacement investments linked to fi xed assets. Finnfrost Oy’s net turnover for 2003 amounted to EUR 164 million, outperforming that of 2002 as well as the 2003 target. The company further consolidated its position in the frozen food trade. Finnfrost’s profi t also outperformed both the budgeted and 2002 levels. Growth in the volume of frozen food sales is expected to exceed the grocery trade average and Finnfrost’s customers are expected to strengthen their market positions. With respect to ice-cream consumption, signifi cant growth is anticipated. The company has bright prospects for growth in 2004. 8
RETAILER BRANDS Grocery retail chains are globally increasing the share of retailer brands in their product range. Since most of these products are positioned at the inexpensive end of the market, retailer brands’ increasing share of total sales is retarding the growth in the value of sales. Retailer brand profi les are therefore being positioned in various ways aimed at distinguishing them from the general product mass and competitors’ products. International store chains are attempting to fortify their competitiveness through retailer brands which provide purchasing benefi ts to the chains and a wide product range at reasonable prices to customers. The chain’s enhanced attractiveness creates add-on sales and increases its profi tability. Retailer brands are reliable, facilitate consumers’ purchase decisions and, at the same time, increase consumers’ confi dence with the retailer. Inex participates in product co-operation, with an increasing share of its retailer brand purchases being made within the framework of the pan-Nordic Coop Norden. Inex provides three brands for its retail customer chains: Rainbow, Daily and X-tra, the number of products in these ranges exceeding 850 at the end of 2003. The food product brand, Rainbow, provides a wide selection of goods, including tinned and frozen food, jam, grain-based products, biscuits, pasta, sweets, juice and other beverages, margarine and cooking oils. The Daily products, from toothbrushes and hairspray to soft toilet paper and candles, as well as goods for household cleaning, washing-up and textile care, are common household products intended for daily, domestic use. Rainbow and Daily products offer the same quality as a manufacturer brand, but at a lower price. The pan-Nordic X-tra brand includes both foodstuffs and non-food products. These reliable, utility-grade products are available at reasonable prices. An image and data bank intended for industry experts and consumers was published on the Inex website in the spring of 2003. It contains information on approximately 850 products provided by Inex under the retailer brands Rainbow, Daily, Hyvä Ostos (Good Buy), X-tra and Pouta. From 9 this information source, industry experts will fi nd product family logos as well as high- and low-resolution images. This service provides basic information on products, including their EAN codes, ingredients, nutritional information, the country of manufacture and, usually, advice on how to use the products. New products are presented under a separate section. A search function makes product details and images easy to fi nd. Meira Nova’s Optimi brand products for the hotel, restaurant and catering sectors are manufactured using Meira Nova’s own recipes, or under contract in co-operation with industrial manufacturers and Meira Nova’s customers. Inex’s development kitchen has a key role in processing food under its own brands. In this kitchen, product candidates are tested and analysed, among other things, for their sensory quality and applicability to various uses, and customer preferences are charted. As part of the quality management chain, Inex’s laboratory authenticates product safety, defi nes the quality criteria and product specifi cations for Inex’s retail brand products and formulates package markings. Retailer brand products provided by Inex and Meira Nova are purchased from reliable Finnish and foreign manufacturers, taking quality, safety and environmental issues into account even at the initial product design stage. Retailer brand products combine high quality with reasonable prices.
Page 1: ANNUAL REPORT 2003 INEX PARTNERS OY
Page 4 and 5: KEY FIGURES INEX GROUP 1999 - 2003
Page 6 and 7: INEX GROUP PURPOSE The purpose of t
Page 8 and 9: INEX PARTNERS OY The core task of I
Page 12 and 13: INEX AND ITS STAFF The purpose of t
Page 14 and 15: BOARD OF DIRECTORS´ REPORT FOR 200
Page 16 and 17: The Group’s equity ratio fell to
Page 18 and 19: EUR 1,000 31.12.2003 31.12.2002 ASS
Page 20 and 21: INEX PARTNERS OY INCOME STATEMENT E
Page 22 and 23: INEX PARTNERS OY CASH FLOW STATEMEN
Page 24 and 25: NOTES TO THE INCOME STATEMENTS Inex
Page 26 and 27: NOTES TO THE ASSETS IN THE BALANCE
Page 28 and 29: Inex Group Inex Partners Oy EUR 1,0
Page 36 and 37: BOARD OF DIRECTORS’ PROPOSAL TO T
Page 38: CONTACT INFORMATION Inex Group, Ine

ANNUAL REPORT 2003 INEX PARTNERS OY

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