LIC Space folds for good
Farmer co-operative LIC has closed its satellite-backed pasture measurement platform – Space.
About a third of that is expected to come from international business ($300m) and about half from growth in the core sector in the dairy business – but via new products and services, some already under development – and about $150m though acquisition, McNee told Dairy News.
They have made one small acquisition, Dairy Automation Ltd, and are looking at other opportunities to acquire businesses mostly in New Zealand.
Annual results released last week show revenue in the financial year to May 31, 2014 was $211m.
The dividend was $11.17m, down from $16.75m last year, with 8.65c per cooperative control share and 35.90c per investment share.
McNee says the key thrust of the new strategy is helping its farmers become more prosperous and productive and delivering the kind of services and solutions farmers will need for the future.
“A part of that is about growing our offering – the range of services we have, improving on the core business we have in genetics and providing more aggregated systems and devices.
“You’ve got data feeds going into the information systems now… it is bringing all that together and trying to provide an integrated offering to farmers so they don’t have to go into this system, that system or the other system…. We are listening to what farmers need from us.
“We got a strong message when we were developing the strategy that farmers want to be part of the process of helping us decide what the new products and services are going to be. So we’re bringing them inside that process rather than doing it all at Newstead and putting it out from there.
“We’re using a better design thinking approach… you bring the farmers in and talk it through with them, understand what their needs are and develop products that can meet those needs.”
LIC plans to at least quadruple its business to $1 billion per annum by 2025, along strategic lines outlined by McNee during the annual meeting: genetics and information for superior livestock (development of genetics and the information needed to develop genetics, plus ongoing focus on the traditional core business of the co-op); and information to help farmers improve decisionmaking to enable superior livestock performance.
During his weekly visits to farms and staff McNee gets a lot of feedback about the need for systems to be better integrated between those LIC has and other systems used onfarm.
Also in view is improvements to Minda and the apps, and the hardware and systems onfarm that help provide the information to feed those systems; the Dairy Automation Ltd acquisition earlier this year is an example of that. “We are looking at other opportunities as well.”
On international business, McNee says they have learned a lot by working with businesses overseas. He recently spent two weeks in Europe visiting 13 companies in 13 days. “It was an opportunity to see what technology is being developed, what the other herd technology companies are doing and the challenges and opportunities.”
LIC’s dairy cow performance strategy builds on the core of what the co-op exists for, arising from strategy developed in 2011-12.
“We are strong in the areas of genetic merit, production and reproduction. We have some work in health on diagnostics. As part of reorganisation I created some new roles which will also focus on nutrition and environment – particularly thinking about the information side and how we can help [farmers] collect information needed to make better decisions.”
“There was a lot of feedback through the change process from farmers and our own staff that said we were not focused on the needs of the customers. [LIC will make] sure we know what you need from us, now and into the future [and that we inject] really good input into decisionmaking about where we focus investment, where the priorities are for the future and that we understand your needs going forward.”
