The mission of Divine Chocolate Limited is to improve the livelihood ...

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Chairman’s Report Sandy Balfour, Chair of Divine Chocolate Ltd, presenting Mr Paul Buah, the newly elected president of Kuapa Kokoo Farmers’ Union with their first dividend. I am proud to present the annual report and accounts for the year to 30 September 2007. The figures reflect a year of consolidation and growth for the company, following the launch of our sister company, Divine Chocolate Inc., in 2006 in the United States. In the UK market the company continued to perform strongly; sales grew by 19% and we made pre-tax profits of £635,000. For the second successive year the Directors were able to recommend a dividend to shareholders. This is important both in real terms and in the challenge it poses for others. The largest shareholder in Divine Chocolate is the Kuapa Kokoo Farmer’s Union of Kumasi, Ghana. They provide the bulk of our cocoa, receive a Fairtrade price for it, and also participate as owners in the management of the company and in its profits. This report covers the end of our ninth year of trading. In that time we have sold more than £39m worth of chocolate and made net profits of £1.9m. Who gets the money? The dividends are the fourth ‘income stream’ which small scale cocoa farmers receive from Divine Chocolate. They also receive the price of the cocoa and the Fairtrade ‘social premium’ and they are often the beneficiaries of monies we spend on strengthening and supporting our supply chain. One highlight of the year was attending Kuapa Kokoo’s AGM in Kumasi at which I had the honour to present the first dividend cheque from Divine Chocolate to Mr Paul Buah, President of Kuapa Kokoo. It was particularly rewarding to witness the animated debate about how the money should be used. In monetary terms the dividends are the smallest of the four income streams, but that will not always be the case. As Divine continues to grow I anticipate that dividends – the return on capital – will outstrip the others in volume and importance. The enduring success of Divine will, I am sure, be that the company created capital for those who previously had none. But Kuapa Kokoo are not the only winners. Our other shareholders, Twin, Oikocredit, and Christian Aid receive dividends too. It is part of the virtuous circle that these organisations are in a position to use their profits in pursuit of social justice and a better trading relationship between north and south. There are other winners too. We have often told the story of how Divine Chocolate would not exist had it not been for the support of DFID and the then minister, Clare Short MP. Back in 1998 DFID provided a loan guarantee which enabled Kuapa Kokoo to participate in the company as owners and not only as suppliers. It is worth noting that DFID was never called upon to make good that guarantee. The loan has long since been repaid. And for the past financial year alone the Treasury will benefit to the tune of £1.6m in corporate and valued added taxes. And yet Divine has never only been about the money. Ours is a vision of a set of trading relationships in which people are valued as much as profit. We deliver excellent chocolate at a fair price to consumers around the world. Their participation in our story is as important as that of the cocoa farmers in Ghana. I want to pay tribute to our Managing Director, Sophi Tranchell, and her team. In a highly competitive chocolate market they have continued to deliver excellent results in an exemplary way. My thanks too to our board for their support, time and expertise. During the year we welcomed Paul Langley from Christian Aid and Ian Barney and Robert Hutchison from Twin Trading Ltd. and said goodbye to Jacqui MacDonald and Robin Murray. A director from the start, Jacqui was an excellent Chair of the Board from 2003 to 2005. Robin’s part in the history of Divine Chocolate has seldom been told. He too was a member of the board from the outset. In the busy, difficult times of our launch in 1998 it was his wisdom, courage and determination that made sure the company came into being. We shall miss them, secure in the knowledge that our loss is the gain of other parts of the fair trade movement. Thank you for your continuing support. Sandy Balfour April 2008
Company News Comfort Kumeah, National Secretary of the Kuapa Kokoo Farmer’s Union, with Jeff Whisenant, Executive Vice President of Lutheran World Relief, celebrating the launch of Divine Chocolate Inc in Washington DC Fulfilling the Divine mission On Valentine’s Day 2007, Divine, the Heavenly Chocolate with a Heart launched in USA! This new company operating under license from Divine UK, is co-owned by Kuapa Kokoo Farmers’ Union, Divine Chocolate Limited, Oikocredit, SERRV and Lutheran World Relief. Kuapa Kokoo is again the largest shareholder, gaining the opportunity to access the $13billion US chocolate market. The launch was a wonderfully organised and choreographed series of events, covered with enormous interest by local and national media. Acting as charismatic ambassador for Kuapa Kokoo, and leading spokesperson on why the new company was such a cause for celebration, Comfort Kumeah, National Secretary of the Kuapa Kokoo Farmers’ Union, braved a typical Washington winter to bring the Fairtrade message to American consumers, government and businesses. Comfort gave briefings on Capitol Hill – explaining about the Fairtrade deal and Kuapa’s ownership of 33% of the new company. Comfort was joined by the newly appointed Divine team in USA, and representatives of the shareholders in the new business. Erin Gorman was appointed first CEO of Divine Chocolate Inc Since this auspicious beginning, Divine Chocolate Inc, headed up at the Washington DC headquarters by Erin Gorman, has already secured listings in Whole Foods, Wegman’s, Norstrom, Food Emporium, as well as a wide range of universities, independent Fair Trade shops and speciality chocolate shops across the United States. Still also working with major customer SERRV, Divine finished its first year in the USA with over $1 million in sales. Producer support and development During the year Divine Producer Support and Development (PS&D) focused on strengthening the governance of Kuapa Kokoo (KK). In February a 3-day workshop with the new National Executive Committee (NEC) and 26 area representatives, was held. It covered leadership skills, decision making, gender issues, project management, and civic rights and responsibilities. Divine PS&D also supported the Kuapa Kokoo NEC in developing a cohesive vision for the future of the organisation. This involved a strategic visioning workshop in which NEC members, executives and other key stakeholders outlined their ambitions for KK going forward. These ideas were then prioritised and developed into a document which was presented to members at the July AGM. This document marked a statement of intent and ambition of the new officers and set demanding targets for each section of Kuapa Kokoo- the summary was well received by farmers. In addition Divine PS&D supported the Kuapa Kokoo Farmers Trust Board in developing clear procedures for the use of Fairtrade premiums. These procedures were approved by farmers and were circulated to all societies. Regular reports of decisions taken will also be disseminated to primary societies helping to strengthen transparency and accountability.
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