Landcorp - Crown Ownership Monitoring Unit

BALANCED SCORECARD 2010OBJECTIVE MEASURE 2009/10 2009/10 2006-2010 COMMENTARYTARGET ACTUAL AVERAGEFinancialMaintain growth ingross revenueGross revenuepercentage growthper annum based on2000/01 prices-3.5% 1.8% 4.7%The negative target reflected anexpected reduction in production as aresult of three years of poor growingconditions. As a result of drought innorthern regions during 2009/10,livestock sales were higher thanexpected.Maintainsatisfactoryreturn on fundsinvested (RoFI)Total shareholderreturn as a percentage≥ weighted averagecost of capital(WACC)WACC WACC WACC−0.3% −13.8% + 1.7%The negative return for 2009/10 wasdue to a 11% devaluation of land andbuildings, following market trends.ImproveproductivityThe value of farmoutputs as apercentage of totalinputs includingoperating expensesand the cost ofinvested capital3.2% 0.2% 2.8% Productivity is the relationship betweenthe value of farm outputs and thevalue of inputs used to generate thoseoutputs, including capital. The reductionwas a follow-on effect from droughtsin 2007/08 and 2008/09. The droughtsled to reduced breeding stock numbersand reduced reproductive performancein a significant proportion of farms.This resulted in reduced production in the2009/10 year. The droughts also loweredthe five year average.OBJECTIVE MEASURE 2009/10 2009/10 2006-2010 COMMENTARYTARGET ACTUAL AVERAGEOperationalMaintain effectivefarmed areaTotal hectares infarm production177,060 177,610 168,953The total includes all land in pasture orcrop, and excludes areas of conservationretirement, riparian strips, forest plantationsand service areas with buildings.Improve pastureproduction andutilisation on asustainable basisStock units pereffectivehectare at 30 June8.8 8.5 9.2Stock units per hectare were slightly belowtarget reflecting the impact on breedingstock of weather events. This situation willchange as Landcorp rebuilds its breedingstock numbers.Sustainablyincrease totalstock unitsTotal closing stockunits (30 June)1,563,984 1,507,400 1,560,090 Stock unit numbers were lower thantarget due to the destocking of sheep andbeef properties to mitigate the impact ofdrought.Increase productionvolumesMilksolids production(tonnes)12,091 11,504 10,503Milksolids production was slightly belowtarget due to drought impacts and otherseasonal conditions in the far North ofNew Zealand.Sheep meatproduction (tonnes)10,196 9,639 10,086Sheep meat production was belowtarget due to the 2008/09 droughtwhich led to a lower lambing percentageand fewer lambs for sale in 2009/10.18