Business

Annual Report 2010

Business

Consumer Product Goods Business Peru
2010 was another excellent year for our Consumer Product Goods Business in Peru (CMP). Sales increased 7%, slightly above private consumption growth in Peru. With this, CMP doubled its sales in the last 5 years. The products portfolio continued expanding to satisfy more consumers, and the distribution system continued strengthening its coverage. Thus, in 2010, new products such as: the detergent “Marsella Max”, “Plusbelle” shampoo and “Kraps” cookies were launched. Brands such as “Alacena”, “Bolívar”, “Opal”, “Glacitas” and “Día” grew by more than two digits. Furthermore, many initiatives were applied to reach more clients. For instance, early in 2010, a new regional segmentation was implemented, which, among other things, expanded the scope of the “Aliados” client loyalty program to include more than 500 people. Later, in July, the new exclusive distributor in Tarapoto started its operations. Additionally, Project “KAI” was implemented to standardize the model to serve key accounts and co-distributors. Likewise, AXUR (formerly MG ROCSA) consolidated its role as co-distributor of Alicorp and received a larger portfolio of products with a nationwide scope. All this, contributed to the core brands increasing their distribution during 2010 so that during the last quarter, the launching of “Plusbelle” and “Marsella Max” reached record coverage figures in the main channels. Finally, the 2nd Specialization Program in Commercial Management (EGC) for our sales force began at the Universidad de Lima. In addition, district managers and key account managers embraced a new challenge directing workshops on sales techniques for more than 600 sales people throughout the Network of Exclusive Distributors (DEX).

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Marketing - Peru
Pasta
We consolidated our leading position in the category with the 5% sales, doubling the growth in the market. The Pasta business is well established by a solid portfolio of brands consisting of “Don Vittorio”, “Nicolini”, “Lavaggi”, “Alianza”, “Espiga de Oro” and “Victoria”. We must highlight the outstanding results of “Don Vittorio”, a brand which continues its consolidation as the market leader, and also has improved its sales volume by almost 10% compared to sales the previous year. In December 2010, “Don Vittorio” was distinguished with the Fem TV Award, as a result of a campaign which emphasized the new role of women in the peruvian society.

47%
Clothing Softener

participation in the Peruvian market in the Detergent category, thus becoming the leader for the first time.

Detergents
Continuing with our strategy to strengthen the detergent’s portfolio, our efforts were focused on increasing the value of our brands “Bolívar” and “Opal” and penetrating the lowest tiers with the launch of “Marsella Max” in October 2010. Accordingly, we achieved outstanding results in the category. For the first time, we gained leadership with a 47% market share by December 2010. “Opal” became the leading brand and “Bolívar” positioned itself second. Furthermore, “Marsella Max con Gránulos de Jabón” achieved 6% market share only two months after being launched. In May, our brand “Opal” was recognized with the Golden Effie award in the Products category on account of its extraordinary results.

month after it was launched had surpassed by far our sales targets. “Jabón Marsella” completes our portfolio of Laundry Soaps.

The “Bolivar” brand “Suaviss”, launched in November 2007 to complement the laundry portfolio, achieved a 5% market share. “Suaviss” and its different versions “Flores Silvestres”, “Flores Blancas” and “Caricias de Bebé” have distinguished themselves as the only softeners with aloe vera and cotton extracts that leave clothes soft and freshly scented.

Cookies
We maintained solid leadership with 33% market share, and grew sales by 8% in 2010. This growth was mainly driven by the consistent support to our leading brands, as well as by launching new cookie brands, with excellent results. From the new launchings, “Kraps”, which became the access point for our entrance into the world of cocktail crackers, strengthening our competitive position in the salted crackers segment. Other launches included: “Glacitas Doble Chocolate”, “Rellenas Negritas”, “+Wafer x 12”, “Rellenas Día Menta” and “Rellenas Fénix Lúcuma”. We also started nationwide distribution of our brand “Día”.

Laundry soaps
Actions were aimed at strengthening the brand “Bolívar” and increasing the value of our portfolio of lower price brands. Alicorp led the category with a market share of 81%. Our brand “Bolívar” is beyond doubt the leader. In June, we re-launched our brands “Jumbo” and “Trome”. In December, we launched the new soap “Trome Blanco”, which one

which included a focus on our leading brands “Casino” and “Tartufo”. Ice Cream In 2010. strengthening the position of the brand in this channel. climate factors affected ice cream sales. during 2010. as sales depend on the warm climate and sunshine. share respectively.00 ice cream segment with the launching of “Crocox”. supported by a strong advertising campaign. “Frutisimo” and “Mini Tartufo Pecatto”. Furthermore. we conducted numerous events and activities in the provinces. and finally. our chili and rocoto sauces managed to increase their sales platform. . the strengthening of the sandwich segment with the launching of “Massimo”. after being launched in November 2009. 1. and also sponsored pet contests. Furthermore. we launched the 2010-2011 summer Lamborgini campaign. Other initiatives involved: the innovation in segments where we did not compete before with the launching of the cone “Chococroc”. a category which is extremely seasonal.Annual Report 2010 Business Sauces “Alacena” is a well recognized and respected brand which. Throughout 2010. as a result of a expansion of the plant capacity and the launch of new television advertising campaigns. In April. “Nutrican” posted 46% growth in sales with respect to the previous year. our first promotion aimed at modern channel consumers. Pets “Mimaskot” continued leading the pet food category and increased sales by 7% compared to 2009. the strengthening of the S/. we launched a new TV commercial for the brand. “Alacena” is considered the best option of canned sauces for house wives. Towards the end of 2010. focused on the benefit of strengthening bones and teeth due to the inclusion of maxi calcium. we launched “Engríelo con Mimaskot”. emphasizing dogs need for special food. we launched a new television advertising spot of the brand which dramatizes the differences between human beings and dogs. sustained its leading position in the mayonnaise and ketchup markets with 95% and 47%. In October.

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In the Jello subcategory. we continued growing by reaching a 22% share and 7% generating more sales compared to the ones of 2009. Similarly. “Cocinero”. the major sales channel for the brand. The development of a sound marketing strategy and efficient management of the pricing strategy generated a 12% sales growth compared to 2009 results. These efforts involved rotation. “Negrita” is the leading brand. “Soyandina 100% Soya”. which translated in turn. turning the Festival into a relevant gastronomic event in the region. to a 19% share of the Peruvian market. “Kanú” and “Yaps”. “Primor Premium”. tasting and improved display activities. As a result. We also introduced three new flavors: Peach. which experienced a record sales year. we launched the brand “Plusbelle” in Peru. “Friol” and “Crisol”. “Cil”. These outcomes were mainly driven by several factors. we focused our efforts in strengthening the positioning of “Soyandina” in the modern channels. The fifth version of the Festival de la Comida Norteña (Northern Food Festival) sponsored by Capri reached record Soy Milk We count with four kinds of “Soyandina” powder: “Soyandina Rico Sabor” (the leader of the brand). market participation achieved by “Alacena” mayonnaise. “Capri”. repositioning the brand with a best value added for consumers. through our brands “Negrita”. “Soyandina Extra Calcio” and “Soyavena”. partially due to its position as “the refreshment with the best flavor yielding three liters”. the first launching in Peru of a brand acquired abroad. growing 35% compared with 2009. our permanent and competitive investment in advertising. pineapple and graviola. despite the price increase caused by the higher international prices of the raw material.000 homes in Lima and six other cities in the country. we re-launched “Kanú” as “the juice with the best fruit flavor”. This allowed us to position the brand as the best option for the house wives family. Edible Oils We are leaders in the market with a 57% share and a solid portfolio of brands: “Primor”. Powder Refreshment Drinks We sustained the leading position with 62% market share. and obtained a 72% market share posting a historical record for the company and the brand. our sales grew 7% with respect to the previous year. This increase was mainly driven by “Negrita”. including door-to-door sales. Instant Desserts We increased our leadership in the Puddings subcategory with the brand “Negrita”. “Kanú” became the third most important brand in this category in Peru. which generated the “Plusbelle” test in 140. In 2010. The campaign was driven by a considerable advertising and promotional support from October through December. representing a 4% growth in market participation. and the implementation of the exchange promotion “Vasos y Dulceras” (shared with refreshments in February 2010) in order to increase brand awareness and improve testing levels.Annual Report 2010 Business 95% attendance. Hair Care Towards the end of 2010. . Early in 2010. such as: the value of “Negrita” (excellent flavor and high 2 liter yield).

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000 contacts.I. the results achieved in both growth and return surpass by far our projections.C. We invested in advertising in opened television and promotional activities in order to support the brand. Walmart. in a year when we widened the price gap until positioning ourselves 20% above our direct competitor. our brand “Zorro” grew 6% in volume. thus maintaining its leading position in Argentina.Argentina Consumer Product Goods Business Mercosur During 2010. . “Sello de Oro” re-launched its image and preserved its position as the ideal cooking and baking margarine. Meanwhile. Similarly. We successfully concluded the acquisition of Sanford S. This opportunity is aligned with the strategy defined under our Vision for 2015. Coto and DIA. as it marks our first step into the world of food in Argentina. “Descubrí Zorro Biocristales. that since the purchase of Sanford. In March. obtaining excellent performances in Carrefour. Argentina and Paraguay. These actions placed ”Sello de Oro” as the second brand in the category. “Manty” continued leading the market mainly due to its positioning as “the ideal spread”. with renovated packaging and a more emotional approach to consumers. Furthermore. They include 117 supermarkets and 36 wholesalers distributed between Buenos Aires (79 PDV) and the provinces (74 PDV). te va a sorprender” was a two-month campaign launched throughout the Federal Capital and Greater Buenos Aires (GBA) which included daily mentions in one of the leading FM radio stations and product samplings in the streets. obtaining excellent results. participation in the value segment achieved by “Plusbelle”. A total of 162 merchandisers supported this plan. we consolidated the leadership of “Plusbelle” in the shampoo and conditioner category in both. For instance. y A in May.F. This company is engaged in the production and sales Laundry In Detergents. Marketing . Alicorp Argentina managed the sales of the “Don Vittorio” pasta in Chile. Total shipments (tonnage) grew 19% with respect to the ones of 2009. in line with the strategy to develop sales channels. We achieved a 13% sales growth in the largest supermarket chains. and thus maintained market share. which aims to provide higher visibility to our leading brands in 153 points of sale (PDF) identified as the most representative in Argentina. we successfully launched the “Top 150” plan. It is important to mention.Annual Report 2010 Business 55% Domestic Margarines of the “Okebon” cookies and represents a milestone in the history of Alicorp Argentina. We maintained our leading position in the market with a 58% share through our brands “Manty” and “Sello de Oro”. the highest volume growth in Argentina derived from the modern channel. Overall coverage involved 105.A. we continued our progress in aligning the Consumer Product Goods Business of Mercosur (Alicorp Argentina) within the Alicorp corporate strategy.

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safety and trust which accompanied by a strong emotional connection inspires positive associations to the brand. This growth was a result of strengthening brand image after relaunching the brand at the end of 2009. In Ecuador. The permanence over time. Furthermore. re-launched “Mimaskot” in Colombia and Ecuador. “Plusbelle” grew 28% in volume with respect to 2009 results. a 115% increased in the costs associated to fats and the shortage experienced early in the year impacted sales in this category. and the launch of two new limited editions for skin care: “Manteca de Cacao” and “Manteca de Karité”. but with significant profitability improvements. Argentineans remember Okebon for its long history which began in 1955. the unmistakable flavor of its milk cookies and the simplicity of the proposal (a product which has been always recommended for babies) built among consumers an image of quality. the brand “Plusbelle” consolidated its position with 12. we carried out the umbrella promotion for all “Plusbelle” categories under the name “Una súper mujer merece premios increíbles” (“A super woman deserves amazing rewards”). we invested in a strong advertising campaign during the February-March 2010 and provided increased support to the points of sale. “Plusbelle” grew 2% in volume and maintained its leading position in the value segment with 55% share despite widening the price gap with respect to its main competitor. sales grew moderately.3% market share. owing the boost to the re-launching of the brand at the end of 2008.Annual Report 2010 Business 2010 was a difficult year for the Laundry Soaps category due to unprecedented price volatility for the fats —its main ingredient— and therefore its shortage. Growth was mainly driven by higher performance in the following categories: Pasta (+37%). which allowed us to maintain our competitiveness in different markets. thus starting our first incursion in the food category in the country. In the Cosmetic Soaps category. As a result. volume grew 7% compared to 2009 results. We also increased market share in the modern channel after launching a campaign through promotional sales force presence in supermarkets to provide greater information about the brand. which is represented by the brand “Suave Federal”. Personal Care In Hair Care. during the third quarter. and sound cost management efficiencies. We launched “Don Vittorio” in Colombia and Guatemala. The brand is well recognized in the Federal Capital and GBA areas. the trend was reversed and 2010 closed with a 7% volume increase with respect to volumes in 2009. “Okebon” ended 2010 with 6% volume increase compared to the ones of 2009. Consumer Product Goods Business Andean and Central American Region The Andean and Central American Region (CAM) grew 4% in sales. as a result of a strategy focused on consolidating current brands and seeking operating synergies. after restrictive measures on imports were eliminated (in effect from 2009 to early 2010). In the Clothing Softener category. It was the first time to participate in internet social networks. Nevertheless. and expanded the “Anua” portfolio in Ecuador. In Deodorants. In turn. Cosmetic Soaps (+170%) and Laundry Soaps (+44%). health. During September and October. we were able to preserve our position as second in the market. we . we added “Okebon” cookies to the brands portfolio in Argentina. Cookies In June 2010. However. primarily led by the brand “Gran Federal”. In addition. consumption recovered significantly as a result of higher performance of our leading brands.

exploiting the benefit of “vitality and shiny hair” and highlighting this benefit through strong advertising and other supplementary campaigns. we launched “Razas Pequeñas” (“Small races”) in order to align the brand´s portfolio through out the region and therefore reduce costs. the performance of the Central American region in this result.Alicorp 80_81 implemented changes to our commercial model which permitted to improve our efficacy in the management of the different distribution channels (direct service to the entire modern channel and management efficiencies to the wholesale channel nationwide). at the end of April. “Brillo”. “Mimaskot” increased monhly sales by 37%. In addition. Hair Care “Anua” positioned itself among the leading brands in the category with 9% share. This Program enabled us to generate important savings throughout the organization. had a positive impact on the brands. At year end. These achievements were possible thanks to the excellent management conducted with our commercial partner to overcome the crisis. we formalized the alliance between Alicorp and Heladosa of Ecuador for the joint development of the Ice Cream category. new packaging and a new television commercial. introducing improvements in its formula. through the Prisma Corporate Program. Additionally. we obtained outstanding performance with 63% sales growth. driven by the success of “Plusbelle” and “Don Vittorio”. we incurred in the Pasta category with the launching of “Don Vittorio” nationwide. We launched a new advertising . All this. we grew 20% overall. and “Don Vittorio” pasta (with 125% sales growth compared to sales in 2009). “Don Vittorio” was launched with a highly competitive value proposal. The brand maintained our regional strategy. In the other countries. It is worth noting. With this. 2010. During the second half of the year. In Bolivia. mainly driven by the performance of “Don Vittorio”. we consolidated our existing categories obtaining a considerable growth in the hair care brand “Babysoft” (+40% versus 2009). 2010 became again a year of sales growth.Ecuador Pets “Mimaskot” was re-launched in August 2010. owing to key strategic initiatives. In 2010. sales grew 6% and profitability was estable despite a 2-month interruption after the earthquake occurred early in +30% sales increase achieved by “Don Vitorio” pasta in Ecuador. Thus. Heladosa —of which we are current partners— became the second largest icecream producer in the Ecuadorian market. our Colombia operations underwent a consolidation process consisting of key operating efficiencies. from which standouts: “Bolívar” laundry soap (with a 45% sales growth in addition to being the leading brand in its category with a 25% share of the market). on the commercial side. In that matter. Marketing . which where focused on increased advertising campaigns and enhanced management of distribution channels through our commercial partner. and launched new flavors in our “Glacitas” and “Xplosion” cookies. which increased its sales by 46%. We improved our competitiveness in the market by doubling the number of refrigerators and enhancing the product portfolio. In Haiti.

which allowed sales to increase more than 30% compared to the ones of 2009. Cookies “Xplosión” grew 32% in sales volume. Additionally. we launched “Don Vittorio” in order to strengthen our Colombia´s operations.Colombia Pets “Mimaskot” was re-launched in May 2010. we launched “Razas Pequeñas” (“Small races”) in order to align the product´s portfolio through out the region and. which is gaining significant presence within the brand portfolio. positioned as “the juice that does taste like fruit”. and introduced . During the second half of the year. we launched an exclusive promotion with “Bichos” —the leading children’s program in Colombia’s opened television. Marketing . The launching was targeted to modern channel consumers. we launched “Don Vittorio” in order to position the product as the best pasta brand. with “Arequipe” being the leader. Special efforts were put in the communication strategy and compliance of high quality standards in terms of product. a success based on the launching of its additional flavors “Arequipe” and “Chocovainilla”. The brand maintained our regional strategy. we can maintain closed contact between the brand and our consumers. which aims to bring the brand closer to female consumers.Guatemala Pasta In April 2010. we have consolidated Alicorp´s presence in a category which provides high volume and has a significant presence in the family basket. new packaging and a new Powder Refreshment Drinks “Kanú” reached 6% market share. “Glacitas” launched the flavor “Doble Chocolate”. introducing improvements in its formula. campaign under the name “Gracias” (“Thank you”). During 2010. In September. These results are primarily driven by sustained volume growth. achieved a 12% market share and placed third in Ecuador. market participation in Industrial Flours to maintain our leadership. “Brillo”. With this addition. Pasta In August 2010. especially developed for colored hair. we focused on positioning “Kanú” as “the juice that does taste like fruit”. one year after being launched. In turn. Powder Refreshment Drinks “Kanú”. In line with our regional strategy. exploiting the benefit of “vitality and shiny hair” and highlighting this benefit through a strong advertising and other supplementary campaigns. Pasta “Don Vittorio” positioned itself as the third leading brand in the Ecuadorian market. In this way. we launched the new variety “Nutrición Color”. packaging and advertising. investments were focused on key activities to maintain our sales and distribution levels in all our distribution channels. reaching a market share of 10% towards the end of the year. Marketing . therefore reduce costs. showing that “Anua” knows about the importance of hair for women.Annual Report 2010 Business 55% television commercial.

Premixes Our brand “Experta” achieved excellent results. the brand “Blanca Nieve” was the most affected. the optimization in the purchase of wheat. we posted record financial results and consolidated an organizational structure focused on capturing new value in three high growth industrial markets: Bread-baking. thanks to the quality of our products. under the brand “Primavera”. bread-baking in Peru. as did the regional brands “Inca” and “Victoria”. Peru ranked first and classified to the 2012 France World Cup. We preserved our leadership with a 55% market share as a result of aggressive and differentiated strategies.000 bread-baking clients and the development of innovative products for each market segment (new products underwent an acceptance test in Fábula. In this scenario. complementing its portfolio with traditional varieties highly consumed in the country. with a 32% volume increase. our bakery model). with the support of the brand “Regia” gave successful results for the category. Furthermore. our core brands “Nicolini” and “Santa Rosa” obtained significant sales increases. where it will compete with the 12 best teams in the world. development and introduction of innovative solutions for our Industrial bakery customers. despite the highly competitive climate. which promoted the training of more than 1. Two major initiatives were developed to this effect: the consolidation of the Innovation Center for Bread-Baking and Gastronomy. hence. aimed at transferring new bakery techniques and products to the market. United States. During 2010. In this matter. Furthermore. as well as through mass workshops aimed at “non-clients”. both categories managed to achieve outstanding results. We preserved our leading position of our core brands in each market. Bread Bakery Products This line of business is focused on the search. Food Service and Large-scale Industry. Thanks to the effort and commitment of the participants. the technical advice developed for our clients and the permanent communication of new products and tendencies. Industrial Flours reached historical figures. consolidating our leading position with a 34% market share. Additionally. sound management of its pricing strategy. as well as through tasting activities in the main points of sale. as well as of the launching of the new presentations “Torta de Chocolate” and “Panetón Premium” and of the consolidation of the technical advisors team within the exclusive distributors. owing to strong positioning of its brands. These initiatives were communicated through advertisements in mass media. several key activities directed to the Pastry market. and the adequate implementation of promotion and client loyalty-related activities. a key aspect in the growth strategy of this category. However. improving our approach to B2B segments. we faced a challenging scenario. such as: training courses. industrial bakeries will improve their businesses. Industrial Flours For the second year in a row. Industrial Shortenings and Margarines In 2010. This is a result of a strong penetration in new clients. Alicorp participated as a official sponsor of the Peruvian Bakers Team which participated in the 2010 World Bread Cup in Las Vegas. . television and cable network.Alicorp 82_83 two new flavors (“Rosa de Jamaica” and “Mandarina”). improved our service offer and launched new products to meet new needs. The margarines category maintained a leading position participating with 69% of total shipments. we were able to consolidate a specialized sales team to bakeries nationwide. customized advisory and showrooms with clients. with a market contraction due to high prices as a result of increased costs of raw materials. Industrial Products During 2010.

Shortenings also maintained a leading position.Annual Report 2010 Business US$ 30 Large-scale Industry Sales volume in the large-scale industry category grew 43%. Thus achieving a 51% total volume growth in the category. we posted a new sales record with a 35% increase with respect to sales in 2009. bordering US$ 30 million in sales and encompassing 8. As a result. we have closed several commercial agreements with clients in China and Japan. This result was also driven by a demand growth for Omega 3 worldwide for its beneficial use in cardiovascular and menopause treatments and obesity prevention. Under the brand “Alicorp Gran Cocina”. This growth was achieved after redefining our target market to include other industries. It is worth mentioning that 15% of the sales come from abroad. sauces. “Gordito” and “Panisuave”. With these and other efforts. we are confirming our promise to be the best strategic partners for our clients. bakeries. snacks and others. We decided to adjust our sales management and technical support after deeply understanding the needs and processes of our clients in the large-scale industry. sales volume in the food service business grew 25%. Similarly. government food supply programs. we undertook a restructuring and consolidation process in the category. This enabled us to adjust and launch products to meet their specific needs and. surpass our annual objectives. three new products were developed to achieve greater efficiency in the client’s processes. In doing so. we promote the consumption of regional products such as: cachanga and alfajor de miel. million in invoicing registered by the Food Service Business. Also. Omega 3 Category In 2010. we offered the Food Service market a portfolio of products especially designed for food businesses with superior results and performances. The primary goal for the category was to reverse the contraction in the market by offering an incentive for the production and consumption of bread products with higher fat percentage in their formula. representing a 25% sales increase. in 2010 we created a new commercial structure focused on serving the growing gastronomy market. We also offered a specialized distribution system and culinary advisory services that strengthen the value proposal for our clients. we reversed the negative trend of recent years after the decline in production of canned fish and emergence of new competitors. which included: increasing 39% sales volume to the portfolio. which represented an additional increase of 12%. adding new materials. . Industrial Oils Category 2010 represented a turning point for this category. thus. as we increased sales volumes 13%. Food Service As part of the growth and innovation process of our Industrial Products segment. we re-launched the portfolio by modernizing the image of “Famosa”. We have strengthen our relations with clients in the ”Industrial Partners Program” through specialized forums. Fat Derivatives Category In 2010.000 clients nationwide. such as: agribusiness. providng added value and increasing profitability in this category. Also. participating with 46% of total shipments. poultry. guided visits to our plants. Through these incentives. newsletters and a new client loyalty program.

it is projected that for 2012. fish and other aquatic species. with more than 250 participants and six sponsors.000 tons per year. This translated into an increase of more than 70% in sales volume for the category. Total sales for “Nicovita” grew 20% with respect to the previous year. Acqua Efitec 2010. Nevertheless. Furthermore. worldwide fish production increased its volume 8% with respect to previous year due to the development of species with greater volume. It is worth mentioning that some tools and activities that “Nicovita” implemented in 2010 demonstrated our commitment to the industry. shrimp prices reached their highest peak in the last nine years. such as carp and tilapia. diseases which affected shrimp crops. . Furthermore. and shrimp farmers difficulties to access quality credits. This allowed to stabilize shrimp feed prices during the year.Alicorp 84_85 Animal Nutrition During 2010. where sales doubled. Alicorp increased its sales volume by 7% through its brand “Nicovita”. shrimp production will recover its positive trend worldwide. in addition to ingredients and additives for aquiculture. world shrimp production dropped by 5%. ensuring the quality and safety of our products. we established Alicorp Trading (Shenzhen) Ltd. despite sharp increases in raw material prices. a Traceability Website. Conversely. sales volume grew 15% compared to sales in 2009. in China and obtained import and sales licenses for feed for shrimp. As a result. tilapia in Ecuador and cobia in Colombia. an increase primarily led by the success in Ecuador. Year over year. However. we established Alicorp’s office in China and the first injection of capital directed to the operation of the company. In 2010. from 20. which attracted 68 participants.000 to 40. Alicorp was able to neutralize raw material price increases owing to an adequate buying strategy. We also applied a replacement pricing strategy. this was not enough to offset the impact of costs increase in shrimp feed production caused by: a sharp rise in raw materials. Meanwhile. Some of these activities included: The Fourth Annual Nicovita Symposium. and the 2010 Workshops Program consisting in permanent client training according to the needs of each market. which enabled us to increase our margins significantly. Co. especially trout feed in Peru and Ecuador. In the Andean region. a tool interconnected with our SAP system which offers reliable information to clients. the Fish category grew as a result of a diversification strategy that enabled materializing sales. the permanent progress in Research and Development contributed to stabilize costs. a contest that promotes efficiency in production management.

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estabilidad y mucha ayuda. No hay pretextos para no seguir superándose”. Gerónimo Adriazola Coordinador de Elaboración .Planta Detergentes .“Alicorp me da todo: seguridad.

stability and a lot of help. Gerónimo Adriazola Manufacture Coordinator . There are no excuses for not trying to improve oneself”.Detergent Plant .“Alicorp gives me everything: safety.

Corporative Support Areas .

Annual Report 2010 Corporative Support Areas Corporate Human Resources Selection We strengthened our image in the local and international market as generators of extraordinary experiences. 179 junior executives have participated in the workshops and courses dictated by local and internationally renowned lecturers. We consolidated our Trainee program. Costa Rica. we participated in the leading employment fairs in universities in Peru. having prepared young talents to take up new responsibilities and challenges in the areas of Marketing. Skills Program We redesigned and added new workshops to our Skills program. crece con nosotros” (“Alicorp is growing. basing our communication strategy on the campaign “Alicorp crece. grow with us”). We expanded our strategic alliances with different academic institutions. Ecuador and the United States. Production. Argentina. The primary objective of the program is to offer the participants tools so that they may develop key competencies to enable them to face challenges successfully in their respective roles. . As part of our strategy to attract talent and position ourselves worldwide. Our challenge for 2011 is to position our image as a multinational company in expansion. Technological Development and Finances. developing new customized business-oriented programs based on the needs of our internal clients. Training We consolidated our Corporate University model. We strengthened and developed new strategic alliances with academic institutions and graduate schools locally and abroad. To date. consolidating ourselves as one of the leading points of reference in the local and international markets.

a document that consolidated the knowhow of our industrial areas management systems. This is an outstanding guide as it has an experience-based and interactive style that illustrates everyday situations among employees and in the industrial plants. Leadership Development Program More than 200 participants at a national level had the Leadership Development Program (PDL) aimed at chiefs. Certificate in Bakery Industry Techniques We developed and implemented the Certificate in Bread-Bakery Industry Techniques in alliance with the Le Cordon Bleu University to benefit our employees in the Industrial Products Business area. We also organized. This program offers commercial and management tools for the sales force at a national level. as well as concepts and strategies to implement improvement projects. 75% of favorable responses in our first measurement of work atmosphere–employees. using instructional and graphic design resources. Educational benefits New academic institutions joined our Educational Benefits Program that offers our employees and their relatives the opportunity to access discounts in the programs of different universities and institutes. Safety. Quality and Environmental Guide. a key factor in managing work teams. with the participation of more than 20 area employees. leaders and/or related positions in industrial areas. This program is developed in alliance with the ESAN University in Lima.Alicorp 90_91 Specialization in Commercial Management In an alliance with the Universidad de Lima. Peru. Quality and Environment With the Corporate Quality and Safety department and the Communications area we developed the Safety. This successful program strengthened several subjects concerning emotional intelligence. The workshop reached its objective to offer management tools for a successful performance in their respective roles. the Educational Fair. Specialization in Maintenance Management We developed the Specialization on Maintenance Management workshop together with the Corporate Maintenance Department. strengthening key personal interaction and communication competencies. Specialization in Distribution Management Our first class of employees studying the Distribution Management Specialization Program (EGD) graduated in November. Grow Program We continued with our Grow program. . supervisors. we redesigned our Commercial Management Specialization Program (EGC) for our second class. as well as the development of a helpful and successful atmosphere. We thus strengthened our leading position as a transformational agent of the market. with the participation of 38 institutions of renowned academic reputation. The program seeks to standardize knowledge and develop strategic skills in the bakery industry. enabling them to exercise a role as business advisors to our clients. aimed at secretaries and administrative assistants. Participants from Lima and other cities expressed their satisfaction as the program benefited them with tactical tools for their management. for the second consecutive year.

one point above the average satisfaction percentage of the companies in the food and beverage line of business. they will receive a training certificate that will increase their employability in the industry. Argentina and Colombia. we kept the standard of the annual medical exams countrywide. the first stage of the project Job Description and Assessment was implemented with the Hay Group methodology. In turn. We implemented the project “Youth Labor Training” that seeks to contribute to the education of young people. we entered into three collective agreements with our unions in Lima and Arequipa. Upon completion of the program. with the labor framework of the collective bargaining. we published the Guide for Blue Collar Personnel Supervisors and the Apprentice Guide. This project forms part of the technological initiatives focused on employee self-management. to strengthen a harmonious work atmosphere. In order to apply a compensation model in line with the growth strategy to the year 2015. Likewise. obtaining 63% satisfaction. Trujillo and Piura. to strengthen through Human Resources policies the role of human resource management of the executives of the organization. Labor Relations Thanks to the joint efforts engaged by the plant management offices and the Labor Relations area. the working atmosphere at Alicorp Peru. Both documents add to the guides and policies that we . where we shared experiences with leading companies in the industrial sector. Compensations and Corporate Support We worked on standardizing corporate policies and work plan support with the Human Resources areas of our affiliates abroad. people enjoyed the “Christmas of the Alicorp Child”. In Ecuador. developing their capacities and potential through an educational process covering personal and technical foundations. To achieve this improvement. The knowledge acquired and the contact networks are being used in our programs and daily management. In order to guarantee compliance of the labor framework and good Human Resources practices at Alicorp. Furthermore. We implemented the Virtual File system to digitalize and access our employees’ files through our website in a fast and safe manner. Arequipa. In the area of social well-being management. improved 4%. complying. which provided us competitiveness in the local and international market. Labor Relations carried out workshops on good labor practices aimed at managers and heads of the Supply Chain Vice Presidency. represented by the slogan “Prevention is our best weapon against disease”. Human Resources Administration The structures of the talks Head’s Role Communication were designed with the Communications and Compensations and Corporate Support areas.Annual Report 2010 Corporative Support Areas 4.500 have been publishing and to the performance of internal audits for a better personnel management. at all times. we continued with the Summer Vacations program that benefited 600 of our employees’ children in Lima. in the case of blue collar workers. the implementation of this activity has already been coordinated and programmed for the first months of 2011. we organized the First Forum on Social Well-being Management.

we performed the first employee-organizational atmosphere measurement at a corporate level. Meanwhile. A total of 175 individual and group interviews were carried out. we held group discussion sessions at high management levels in all our affiliates. in line with the growth strategy of Alicorp. we performed an Internal Communication (CI) diagnostic at a corporate level. Through Introductory Workshops with the active participation of the Management. Ecuador and Colombia. In order to strengthen our open-door policy. Balanceados (Trujillo) and Sidsur (Arequipa). we celebrated the “Christmas of the Alicorp Child” in Parque de las Leyendas. Employees and their families (4. respecting cultural differences. which positioned us 12 points ahead of the average of the leading companies in Spanish-speaking countries (average acceptance 63%). Events In June. we focused on contributing to the development of talent and cultural consolidation within the organization.500 people) enjoyed the Christmas show presented by a well-known child entertainer and the new park attractions. The results obtained were highly satisfactory as Alicorp achieved an acceptance percentage of 75%. This diagnosis provided us information on the actual situation of our Internal Communications and enabled us to lay the foundations of our 2011 communications plan adjusted to our needs and prioritizing interpersonal communication. After the traditional Christmas Mass. whose members shared with us the experience and excitement of participating in this integrating event. Communications In 2010. our Ecuadorian employees started to work by competencies under the concept “Release your Potential!”. We also designed an Internal Communication Model with an international approach that defines roles. in December we held our Christmas Party.480 employees.Alicorp 92_93 At the 2010 Inter-Plants event. Colombia and Ecuador joined the Self-management Platform. presented under a new format called “Talents Show”. Finally. with the participation of Peru. our General Manager shared the year end results and expressed his gratitude for the effort displayed by every one of the employees in achieving the goals of the organization. with the participation of our affiliates abroad. responsibilities and subjects to communicate at local and regional level. in which some of our colleagues from the different areas also participated. where employees from the different plants presented different performances and dances that made a good impression on the audience. for the third year in a row. As part of the SMART Management Excellence Program. In addition. Also. whose members delighted us with a show full of energy. In Alicorp Ecuador. who enjoyed raffles and a show presented by a wellknown musical group. in order to show clarity with respect to our company’s strategy. Organizational Development In 2010. we celebrated in Fundo Mamacona our integration day called “The Recipe for Fun”. we implemented the Competencybased Management Model that seeks to obtain a higher performance from our employees and establish our corporate culture. 30 new managers and directors of Peru. and which allows for easier and faster coordination of internal communications in all the countries. The event drew to a close with the participation of a known dance and percussion group. Argentina. We welcomed 2. . we launched the program “Talking to the Management” in our international operations. During the process. Argentina. they discovered their leadership styles and preferred management atmosphere. for the first time we had the participation of football delegations from plants outside the capital: Calixto Romero (Piura).

In addition. Furthermore. These suggestions are in line with the recommendations being promoted by the Ministry of Health. we launched the first stage of “Feed the Future”. and to end food-related myths. making it easier to read and put in order our organizational notices. we developed a new brochure and an institutional multimedia video to present our company to the different stakeholders in a totally updated way. Road and Pedestrian Signs Policy. etc. organized by the InterAmerican Development Bank (IADB). eating during pregnancy. the best received Social Responsibility In Alicorp. such as balanced food for infants. organized by EsSalud -The forum organized by the Peruvian-Spanish Chamber of Commerce -The Social Responsibility Forum of the National Society of Industries (SNI) -The forum organized by the National Industrial Training Service (SENATI) With regard to social investment.. physical activity. in order to strengthen our communication channels with plant personnel. etc. The main campaigns undertaken in coordination with different areas were: Clothing Policy. we continued sharing our experiences and success cases in different national and international forums such as: -The Private Sector Solutions in Nutrition. The campaign was broadcast through five channels of open signal television using commercial spots to promote good eating habits. promoting economic. the Global Alliance for Improved Nutrition (GAIN) and the Femsa Foundation in Brazil -The Peruvian Congress -The forum organized by the Nutrition Program of Universidad Villarreal -The Nutrition Program of Universidad Peruana de Ciencias Aplicadas (UPC) -The International Refresher Course in Nutrition. social and environmental development of the stakeholders we relate with and based on . in line with our organizational culture and strategic objectives. launching of a webpage and online trivia about Competencies-based Management. we implemented the optimization and standardization project of our plant bulletin boards countrywide. ethical and transparent relations and on the execution of social investment programs focused on early childhood development. supplementary food. we had the following initiatives: Television campaign “Alimenta el Futuro” (Feed the Future) In May 2010. pieces and actions. a television campaign for child nutrition aimed at all Peruvian families with children under five and pregnant mothers. we strengthened our organizational culture and boosted key programs of the company through the development and implementation of more than 70 internal communication plans. After transmitting the campaign during 21 weeks. the Social Responsibility model is part of the business strategy. CIANA 2010. and making them more visible and attractive.Annual Report 2010 Corporative Support Areas To 62% (from 48%) increased the proportion of mothers who feed their children mainly with first course meals instead of soups. We developed a mapping of our stakeholders to learn about their expectations in relation to Alicorp’s management of social responsibility. Furthermore. Finally. we reached 84% in comprehension of messages issued. proper hygiene. the importance of breastfeeding.

We also contributed with sustainable development projects of the Romero Foundation. Donations Program Every year.400 children and more than 1. Huancavelica and Puno. Since it Productive chains We continued one more year with the development of the durum wheat production chain. training. only 42% stated being aware of that. the chain transferred . Andahuaylas. three nutritional cooking workshops were conducted with the support of our innovation center “Fábula” and our nutrition consultant Milagros Agurto.900 mothers. we implemented the child nutrition educational program “Recover”. Ayacucho. or mainly. in joint efforts with Cáritas of El Callao. it has benefited close to 3. 65% of the mothers thought physical activity was important and by the end of it. The guides are translated to Quechua and Aymara. this perception had grown to 82%1. -The percentage of mothers considering that for their children to be healthy it is important to feed them with baby food once they are six months old increased from 69% to 81%. “Recover” For the sixth consecutive year. -We strengthened knowledge in mothers and achieved a 10% increase in the awareness of the importance of nutrition during pregnancy. -The percentage of mothers that are aware of the importance of physical activity grew from 65% to 82%. Furthermore: -We registered significant progress in good consumption practices with regard to the main course: we were able to increase from 48% to 62% the proportion of mothers who state they feed their children only. In the baseline study. and by the end. In addition. in 2005. which began in September 2010. seeks to benefit 800 children and 500 mothers in the area. The project. At the beginning of the campaign. which due to the great demand in the food industry. recognition and others. for our employees) had the collaboration of more than 80 volunteers. in five disadvantaged areas of Pachacutec. -With regard to “breastfeeding”. who received training in the use of the guide to improve their radio techniques and become opinion leaders in child nutrition subjects in their communities. with main course dishes instead of broth. 1 Source: AF IPSOS Apoyo Opinión y Mercado campaign evaluation. Cusco. Alicorp promotes a donations program for several institutions. such as the program “Cuatro x 4” broadcast by two open air channels. social benefits. we actively contributed with the action plans of five new suppliers who seek to join ABE in 2011. Campaign “Healthy Radio” “The Healthy Radio: Community radio and child nutrition guide” reached more than 150 radiobroadcasters in 2010 in rural areas of Abancay. This distinction guarantees that Alicorp meets its legal obligations (salaries. November 2010 began. offers a profitable crop growing alternative for farmers. Ventanilla. Furthermore. Good Employers Association (ABE) We renewed our commitment with the Good Employers Association (ABE) revalidating our certification as Founding Members. who dictated educational sessions covering nine important topics concerning nutrition and development of children under five were addressed. Furthermore. “Los Niños de Alicorp” (Alicorp Children) Volunteering Program Our internal volunteering program (from our employees. With an inclusion approach.Alicorp 94_95 being those with advice regarding the importance of physical activity in children under 3 years. the proportion grew 12 percent points to 54% of the mothers. medical insurance) and with good labor practices in performance. the most relevant change was achieved in their learning that they must give maternal milk to children up to 2 years old. two clinical campaigns were conducted for the children of more than 110 families of Alicorp It is worth mentioning that our internal volunteering program “Los Niños de Alicorp” obtained first prize in the category Collaborators of the 2021 Social Responsibility and Sustainable Development Award granted by Peru 2021. babies’ first food and the importance of washing our hands.

Copsa Through our Prisma initiatives we achieved annualized savings of S/. with which we improved the packing quality and obtained greater production flexibility. the lowest value in the last 3 years. Sauces and Mayonnaise. 19% more than in 2009. which yielded 3. and according to demand.Annual Report 2010 Corporative Support Areas a technological package for farmers to make the most of the seeds yield. Furthermore.3% with respect to 2009. Pets Lima Through improvement techniques and with the unification of products for the different markets. the Galgo project. 6. increased the detergent blowing capacity by approximately 40%. At the same time. We also increased manpower production performance by 10%. 15. S/. which.487 million (US$ 2. In the packing area. which represented savings of S/. we also installed three Masipack packing machines. when only 1. We might add that energy consumption was reduced 15% per ton and manpower 10%.400 million). with an investment of . achieving a lower conversion cost (-5%). achieving 14% less consumption per ton. the project has benefitted more than 2. Calixto Romero The sales of oleine products achieved 35% increase compared with 2009.000 (US$ 5. Meanwhile.125 million (US$ 0. without working Sundays or holidays since September.304 million). 14. where 100 hectares of durum wheat were sowed. which provide greater capacity and flexibilityfor large bags. The packing loss decreased 40% with respect to 2009. 5. packing of Shortenings. Pasta Plants Lima We implemented the Prisma initiatives. while the percentage of non-compliant product was reduced down to 1. Corporate Supply Chain Production This was an excellent year for all the plants of Alicorp Perú. Detergents We made significant investments in the Detergents plant to increase the production capacity and we installed a slurry preparation line. Finally. The new Sauces plant started operating in October.160 million) and production performance increased by reducing specific use of manpower by 13. the PFA and PFL plants increased their production 13% with respect to 2009. In 2010. an air lift system and a sleeve filter. Line 1 was implemented at our PFA to meet the demand increase for Cortados (Short noodles). Margarines. Cajamarca. 1.000) to optimize the return for farmers in areas of extreme poverty. we were able to easily produce a volume of 16. and we achieved historical production records in Oil bottling. producing 914 additional tons during the year and we installed two state-of-the-art packers at the PFL. with respect to 2009.500 families and has invested more than S/. we also streamlined the use of electric power.000 kilos per hectare. 0. thus allowing us to break the production record.5% more than in 2009. 2 million (more than US$ 700. we implemented Prisma initiativesthat obtained savings of S/. Over the years.6 million). increased its effective production capacity by more than 50%. and we succesfully reduced clients’ claims by 70%. Our Prisma initiatives achieved savings of S/. in August.6 million (US$ 2 million). and we obtained production records in August and September. We also reduced the conversion cost. of Chile.68%. which allowed savings amounting to S/. added to the investment made in 2009. and a 17% reduction of PNC (Non Compliant Product) compared to the previous year.680.531 million (US$ 5. of Lean Manufacturing. One of the most important results was achieved in the Citacocha Valley.218 million).000 kilos are usually obtained per hectare. we had zero PNC and zero interruptions and were able to comply with 100% of the products required by our clients. we also started the tolling service for Carozzi.615 million (US$ 0. We have to say as well that the actual oil loss was reduced at the Neutralization plant.

production increase in the Pasta Plants Alianza and Lima with respect to 2009. asof December 2010. PNC decreased 18% with respect to 2009.128% growth with respect to 2009. 820.15%. We also took different actions for Quality and Production enhancement and we achieved savings of S/. To conclude. We also saved more than 140. we completed our third year without disabling accidents. Cookie Manufacturing Plant Trujillo We achieved a 15% production increase with respect to 2009. 0.913 million (US$ 0.000 kWh in electric power consumption with lighting enhancements. and we set in motion the Fire Fighting Network and the Diagram B . we recorded a 3% decrease in conversion costs. In turn. cobia. such as paiche. accumulating. Meanwhile. flour and sugar in the cookie production and forage storage systems in silos. and at November 2010. The Prisma initiatives implemented allowed us to obtain the following savings: -Capture 2010: S/. We also repaired internal roads and main access to the Sidsur Plant and the Arequipa Mill. We strengthened the development of feed for trout and exotic species. Finally. 1. 13% Sidsur We obtained BASC certification (Business Alliance for Secure Commerce) and renewed our DIGESA (Health Bureau) certification. and we managed to lower the PNC percentage.2% in 2009 to 0. using the broad band of Group Alicorp. thus avoiding third shift packing.100. from 1. -Annualized: S/. Nicovita Trujillo The Plant at Trujillo had a record annual production comprising 9.574 million (US$ 0.000 (US$ 290. 1. Furthermore. we obtained Callao Mill We obtained our safety certificate from INDECI.204 million) with respect to 2009.. with a historical production record. streamlining of transmissions at the Victoria Mill and replacement with high efficiency motors.15% in 2010. Also. Prisma initiatives achieved annualized savings of S/. closing the year with 0. the first ice cream on a biscuit cone produced at the plant. surpassing our target. our BASC re-certification and certification by the National Institute of Civil Defense (INDECI). with very good results among our clients. Furthermore. compared with 2009. Instant Products Plant Breña We diminished losses by 40% with respect to 2009. we executed a computer-aided surveillance and control camera system to monitor personal access to the property. etc.Alicorp 96_97 Ice Cream Last year we started to produce “Chococroc”.000 million).000 million). 0. and built a gatehouse and refurbished the façade. thus diversifying our range of products.500 additional tons) and started using the Lean Manufacturing management methods in the Premixes plant and TPM (Total Productive Maintenance) up to step 3 in the cookie packers. Cookie Manufacturing Plant Lima The launching of six new products contributed to the production increase (the importance of innovation and the development of new products were emphasized). we expanded the wheat storage capacity in the Arequipa Mill silos (1.136 days without accidents. as well as a fiber optic data network and data communication between the Sidsur and Arequipa Mill properties.000 (US$ 390. we implemented fluidizing systems for bulk noodle.324 million). pargo.

achieving an 8% increase in four months production and 4% decrease in process losses. 70% of which were implemented in 2010. in addition to reducing the dust in the packing area by 70% after modifying the machinery’s aspiration system. automation system. Lastly. sales increase of oleine products in Calixto Romero with respect to 2009. San Justo Plant Towards the end of the year. In August. following which they made a presentation for their colleagues back home. where they visited several plants and had the opportunity to get acquainted with the best manufacturing practices. Argentina Moron Plant We took over the control of the “Okebon” cookie factory. 1. which obtained the best results within the EPI Program (International Plusbelle Equipment) which consists basically in the development of self-controlled equipment. In addition. we made effective the external packing change of the powder detergent with the implementation of new equipment for fully automatic packing of large bags. we had historical milling numbers. our improvements proposal system had the participation of 100% of our plant personnel. Furthermore. inventories were streamlined in Lima. agreements with clients for longdistance shipments and changes in the distribution network. as well as Civil Defense certificates issued by INDECI for the four properties. such as palletized deliveries. was awarded a trip to Lima. they submitted 57 savings initiatives. with its industrial plant located in Moron. external rejected and returned products due to founded quality issues totaled zero. we changed the carousel packing system and the control sieve.550 million). and for the second year in a row. Faucett Mill A milling record was achieved in 2010 and in September we implemented the MFA input warehouse. Among them we must mention several transportation optimization ideas. achieving continuous operation of the Fawema machine for the production of 1-kg packs of self-rising flour.Annual Report 2010 Corporative Support Areas 35% Santa Rosa Mill Paita Mill There were no accidents in 2010. Environmental and Occupational Safety and Health Management). In Colombia. We obtained certification for our Tri-Norma System (Quality. In Consumer Product Goods.550 million (US$ 0. we streamlined the packing area. Distribution The projects presented by the personnel enabled us to achieve annualized savings amounting to S/. improving packing reliability. as well as improvements in the logistics of the Ice Cream category through the “Just in Time” implementation with the mobile channel and the resizing of our logistic capacities. Trujillo Mill We were issued our safety certificate by the National Institute of Civil Defense of the Regional Government of La Libertad. we increased the PMX plant production capacity. . Garin Plant A team of operators of the Garin Plant. Altogether. several streamlining strategies were executed towards improving the logistics performance. Likewise. which will contribute valuable savings in the cost of this product. We also built and installed sound-proof booths for high power motors and lowered the outside noise level.

a tool that enables clients to verify online the characteristics and quality of the finished product batches. the negotiation of centralized distribution with supermarket chains. and implemented a storage area of 1. Furthermore. Quality This was the first year in which our different management systems (Quality. . In Cusco. Meanwhile. we implemented the direct dispatch project from container to motor vessel. implementation of transportation providers and the establishment of new service standards in the delivery of orders. As part of the initiatives to improve the delivery service to clients. cutting lead times and generating savings for the company and the clients. with direct access to train tracks and docking for trucks. we channeled distribution through an exclusive distributor). ISO 14001 and OHSAS 18001 recertification simultaneously. With this. establishing different service requirements per distribution channel and client segment. we implemented the project “There is room in the middle” and managed to reduce additional space needs to only 2. we inaugurated the new warehouse and sales office in Tumbes. As part of the technical advice program of the NNA. With regard to the traceability management system. In Trujillo. we negotiated the renewal of leased combustion-driven lifting equipment. improvement in the coordination of shipments and transfers from the distribution center to an area with substantial tax incentives. in Colombia. we implemented 50-position palletized trucks for transportation from the plants to the distribution centers. In Ecuador.Alicorp 98_99 In line with the growth of our Consumer Product Goods and Industrial Products segments. Thus. This change implied a new design in the operations. we acquired two tanker trucks to transport flour in bulk between plants and to industrial clients.000 sq m distribution center. In Colombia. we resumed direct distribution to our clients (before. we increased our transportation and warehouse capacities countrywide through negotiations with suppliers. a condition essential for the launching of the traceability internet site. we improved warehousing conditions and the image of the brand “Nicovita” in this shrimp growing area. we inaugurated a 6. In the case of the supermarkets channel. we are in the process of negotiating centralized deliveries for each chain. meeting the demands of one of our main clients in Panama. generating savings in the chain. In the RANSA distribution center. completing an important stage of the integration process of these systems. we increased the storage area by 30%. we achieved significant savings with the start up of different initiatives like the reduction of inventories.000 positions. the first fish feed exports on pallets began. direct dispatches from the plant to important clients in Ecuador began. With regard to projects. we implemented the batch-based inventory control in our warehouses in Colombia. we negotiated with transportation suppliers to acquire 18 additional trucks for deliveries to clients and we continued with the replacement of the oldest trucks in the fleet. Together with RANSA. With regard to the expansion of our fleet.000 sq m at the Industrial Products distribution center. In the Animal Nutrition business. Environment and Safety) passed the audits for ISO 9001. the implementation of a distribution center with Ransa Ecuador. the renegotiation of warehousing and freight rates. in addition to the GS1 seal re-certification. This is to raise awareness of the farm staff about the importance of proper handling and care of the food during storage and transport. we separated the planning management and delivery programming for wholesalers from the rest of the clients. reputable warehousing practice workshops were conducted in Ecuador for the personnel of our main clients’ farms. we formed a work team with the Planning personnel to reduce and streamline inventories with several initiatives. obtaining greater benefits compared to the previous contract.

000 man hours). including the customs warehouses and the Wheat storage yards (August). -Lima and Alianza Noodle Plant: 120. At Calixto Romero. to improve industrial discharges in compliance with international standards. we successfully completed migration of our Occupational Safety and Health System based on Loss Control – DNV and on OHSAS Standard 18001:2007. obtaining certification for our system under this international standard.000 kWh. Meanwhile. while facilitating integration with the Quality and Environmental Management area. Lima and Alianza Noodle Plant. with a frequency rate of 3.000 in safety systems and equipment.70 (total accidents per 200.000 kWh. the Balanced Food plants of Trujillo and Lima. we defined the purchase of a modern plant for treatment of effluents. for example.Annual Report 2010 Corporative Support Areas US$ 400 thousand investment to strengthen and improve security systems and equipment. we obtained ISO 14001 certifications for the Callao. our plants generated savings in their electric power consumption: -Rimac: 353. implemented environmental management systems towards obtaining certification in the first months of 2011. the purchase of self-contained air equipment units and radios for our plants and fire-proof doors for our Central Distribution Center. At Copsa. Environment In 2010. for the start up of the fire fighting network at the Callao Mill (as well as its emergency alarm and lighting system).000. -Copsa: 273.000. we invested US$ 400. we recertified the quality system with the USP (United States Pharmacopeia) for nutritional inputs. In addition. based on the selection and upgrading of equipment units.000 man hours) this being the third lowest value in the last nine years and an OSHA Incident Rate of 1. During 2010. a severity rate of 66. etc. Sidsur and Calixto Romero Plants. we kept our Kosher certification (standard that regulates food products for the Jewish community) for our oils.000 kWh. We kept the ISO 9001 quality certifications for our plants and distribution area. In turn. the Balanced Food Plant obtained the CE 834/2007 certification from the European Economic Community and kept its Naturlan certifications for organic food and Global Standard One for traceability. the Lamborgini Plant prepared its quality system to be certified in 2011. .000 man hours).000 kWh. In addition. the lowest in nine years. Santa Rosa and Faucett Mills. Another achievement was the certification by INDECI of our Callao Mill. at Alicorp we must state that the total number of accidents was the lowest registered in the last four years. a cooling system in ethanol tank. the Manco Cápac Warehouse (September) and the Santa Rosa Mill. In Trujillo. the implementation of signage and emergency lights at Copsa. that add to the Copsa Plant. Industrial Safety Summing up the outcome of the Occupational Safety and Health Management in 2010. and the Detergents plant. the installation of a fire system network and alarm system in the Instant Products plant (Breña). At the Copsa Plant.37 (disabling accidents per 1. -Sidsur 142.04 (days lost per 1.

for a better treatment of imports of finished product samples. and with the National Port Authority (ENAPU). which improved the supply process to them. In the Industrial Products Business. These values positioned us among the best company results in an international benchmark. which will enable us to focus the sales management and the logistic planning management. this being a strict requirement of Alicorp in respect to third parties offering their services in our facilities. similar to the one applied in Peru. in addition to the GPT transportation planning and the demand process. with whom we initiated a negotiation to lower rates. in particular with regard to consolidating the demand process in Consumer Product Goods Business Peru.000 in the year. Furthermore. In Imports. where an SCM 5. we completed satisfactorily the external BASC auditing process for the Callao and Sidsur Mills (December). the main achievement was the reduction of international freight rates. reaching 94% in some months.0 System was installed with the Optimizer module. the Alianza Noodle Plant (November) and Calixto Romero (March) and our headquarters (December). towards achieving significant inventory reductions and stock outs. we managed to cut costs in our operations in border areas by loading and stowing directly into containers. In Exports. which enabled us to make most of our customs clearances with a “green channel”. we made joint purchases with Grupo Romero and significant savings were achieved under the leadership of Alicorp in the negotiations for different items purchased in large volumes. We achieved Prisma savings on the purchase of spare parts and. With regard to Exclusive Distributors.480. we achieved synergies for the purchase of nine similar inputs with our subsidiaries in Argentina and Colombia. with the immediate release of our merchandise. in close coordination with the different areas that require purchases and we participated in new products projects. In the Consumer Product Goods Business Ecuador.Alicorp 100_101 Our BASC Management System also gave us good results when it achieved recertification for our Animal Nutrition plants in Trujillo (April). We achieved closer contact with public agencies such as the National Institute of Agricultural Health (SENASA). different strategies were developed that reduced costs and generated other benefits in the amount of US$ 7. At SKUs level accurate forecasts reached 71%. furthermore. having implemented the SAP Planning Modules related to MRP and MPS. In Local Purchases. In Foreign Trade. In addition. we consolidated with the service providers the homologation process concerning the legal compliance with Supreme Decree 009-2005-TR that requires that all companies that offer services have in place an Occupational Safety and Health Management System. which offers us the possibility to replicate the way we work in Peru. inputs. were able to recover specific import duties on raw material that had been overcharged in 2001. the Planning Organization. Purchases and Foreign Trade We consolidated our Purchases and Exports management. avoiding extra costs. with the participation of Indesmar. to start the application of demand processes as the one used in Consumer Product Goods Business Peru. The same adaptions were implemented with the Animal Nutrition Business. resulting in improvements in the inspection of raw material shipments. spares and miscellaneous supplies. we consolidated . we set in motion the segmentation and definition of the products portfolio by office. we negotiated with suppliers in different items such as packing. as well as through the direct entry of our cargo into DP World at the Planning 2010 Corporate Planning in 2010 had a good performance. a resupplying system was implemented in Lima with fixed inventory by SKU. In turn. we maintained the “good taxpayer” category. with the General Bureau of Environmental Health (DIGESA). which enabled us to achieve approximately 90% accurate forecasts in all Categories. Adaptations of the planning processes at corporate level were also started in Alicorp Argentina. hence we will be recommended to the World BASC Organization for the certification of these plants.

and adequate conditions in the international market. while managing to lower our funding cost. we increased the use of our factoring lines for suppliers to US$ 27. In turn. the new shared service company of the Group. Molinera Inca. Furthermore. With these suppliers we were able to access competitive interest rates. the financial structure of Alicorp presented very low exposure to volatility in rates and quite moderate exposure to exchange rates. achieving a very competitive funding cost. a subsidiary of Alicorp. channeling our operations through different financial institutions. owing to two rate and currency hedging operations made with two international banks. lowering the financial cost substantially. we will continue working to achieve a better rating. Credit Risk In May 2010. We also achieved a considerable reduction of the rate of our corporate bond issued in September 2009. This was a result of our efforts to Management Control The Lima Stock Exchange recognized Alicorp. for the third year in a row. Machala and Guayaquil. Confirming Operations In 2010. The transfer process was completed in July 2010. we refinanced the US$ 60 million loan we had with the Royal Bank of Scotland (initially ABN) with two local banks. which was used to issue securitized bonds that same year and were completely repaid by the end of 2009. and obtain discounts in the international logistical cost to these destinations. Cartagena. Financing We continued improving the conditions of our loans by significantly lowering the average rate of our short-term operations for working capital. We closed the year with a net financial debt of US$ 151. As part of this process. included a rate and currency hedging structure. which represented an important milestone in our objective to increase efficiency in the use of our internal resources. Operational Treasury As part of a streamlining strategy process applied in several of the companies of Grupo Romero.to AA. Trust Fund At the end of November. This system enabled us to offer our suppliers immediate payment for their invoices by discounting them. this time by Apoyo & Asociados. Alicorp continued consolidating its solid financial situation. which confirmed our financial strength. the credit risk rating of our corporate bonds was increased again from AA. we transferred our operational treasury processes to Priox. as a member of the Good Corporate Governance Index. which contributed to a significant reduction of financial expenses and to the strengthening of our working capital. we reduced our annual financial expenses by 36. With regard to our medium-term operations.9 million.6% with respect to 2009. As a result of these actions.8 million and an EBITDA of US$ 218. entered into with an international bank. we achieved efficiencies. We also managed to reduce from 18 to 14 days the transit time of port activities and official inspections in the ports of Buenaventura. but also the funding cost. our working capital strengthens as a result of increases in the payment period. both financial and operative. With these structures we not only reduced the foreign exchange and rate volatility risk. obtained a medium-term structured loan for US$ 40 million for the purchase of the securities held by the equity. As of the closing of the year. due to the result of the rating obtained in Good Corporate . This operation. reflecting our optimum capacity to continue funding our expansion. we were very active in rate and currency hedging operations. engage with local and foreign banks. In 2011. we liquidated the trust fund established in 2004. Corporate Finances Treasury and Capitals Market In 2010.Annual Report 2010 Corporative Support Areas port of El Callao and at Terminales Portuarios Euroandinos in Paita.5 million. Hedging Operations During 2010.

we implemented electronic security systems. in order to offer greater comprehensive security to our offices and plants. During 2010. In our role as strategic partners in business. we kept on innovating in the internal process as part of our permanent improvement. Industrial Safety at the Copsa Plant.6 million . Seeking to optimize the accounting process. We also started the machinery and equipment inventory at the industrial plants.480 million (US$ 0. Hydrogen/Refinery Plant. APT Fideería Lima. and for our collection and third party personnel. Priox. showing that the company is governed with transparency. we worked with the Prisma expense reduction program. achieving annual savings for S/. Animal Nutrition Plant. This process was completed in July 2010. US$ 218. for subsequent sale or disposal. as well as in Buildings and Land. as well as the Nurse Station at our central facilities. Animal Nutrition Plant in Trujillo. 3.1 million (US$ 1. 28. and remodeled our entrance Accounting The new General Corporate Accounting Plan was implemented in February.2 million (US$ 1. for subsequent appraisal of the fixed assets within this heading. alarms. Corporate Marketing. 0. we implemented 16 remodeling.Alicorp 102_103 Governance Principle compliance. 6.9 million was our EBITDA result. a good rating indicates to the local and foreign market that we are committed to the principles of responsibility towards shareholders. in our efforts towards environmental protection and market safety. the execution of which has generated. In order to improve the current return levels. 34 million (US$ 12 million). -We developed enhancement projects.170 million). Finished Products Warehouse at Fideería Lima. (US$ 10 million) and we sold obsolete material for S/. Fideería Lima Plant. 169 million (US$ 60 million) and during 2010. electric fence and closed TV circuits in several of our plants in Lima and outside Lima. Glycerin Plant. Industrial Products Business. 28 million (US$ 10 million) and to follow up 169 initiatives with annualized potential benefit of S/. in the amount of S/. reorganization and furnishing works for our Consumer Product Goods Business Peru. -In turn. 4.041 tons of solid residues were collected. savings of more than S/. making ABC an active participant in the development of our businesses and participating in different scenarios in order to simulate the performance of new category projects. Breña Plant. Corporate Human Resources. For Alicorp. Calixto Romero Plant. -Furthermore. Paita Mill. during 2010 in the Central Administration area we achieved the following: -We closed the sale of six properties throughout the country that were not in use any more.1 million). -We also undertook the construction and remodeling of locker rooms and toilet rooms at the following plants: Faucett Cookie/ Mill. trust. groups of clients and commercial partners. the accounting and tax duties were transferred to the new shared service company of Grupo Romero. Central Administration Always seeking to offer the best service to our internal clients. it enabled us to identify 161 initiatives with annualized potential benefit of S/. since it was implemented in 2002. Sidsur and the Copsa Plant auditorium. Trujillo. -In the Collecting area.5 million) and obsolete assets for S/. fairness and social responsibility. the Activities Based Costing System (ABC) is a tool that favors the analysis of a comprehensive vision of the business.

Systems During 2010. we established the digitalized file for workers in the headquarters. we joined the corporate initiative of Grupo Romero regarding the creation of Corporate IT. this will favor efficiencies in the acquisition of systems services and sharing best practices. incorporating our information technology staff in this new initiative during the second half of 2010. etc.Annual Report 2010 Corporative Support Areas US$ 60 With regard to our Exclusive Distributors (DEX). hallway and visitors reception desk. we installed the Warehouse Management System in the Cookies Finished Products warehouse and established batch management at the CDC.0 version. the Traceability Website for NNA-Shrimp and NPI-Omega Clients and the PM Maintenance and QM Quality modules in all Molinca plants. million of savings generated by Prisma expense reduction program. In Distribution. the Optimization model for NNA in the national and international shrimp feed network. the Plant and/or Stalled Equipment Control System (OEE) and the Planning System (MSP/MRP and GPT). We also implemented the QM Quality module in Alicorp Colombia. At Alicorp. the . we implemented the Contact Center System of SAP in Peru and worked on implementing the sales force of the Industrial Products segment countrywide. we worked on the Inter-bank Payment System to Suppliers and set in motion the new General Corporate Accounting Plant. -Implementation of breathalyzers in all plants in the provinces. In commercial and customer service subjects. we implemented the Batch Management (Traceability) in the Industrial Products Segment (Pre-Mixes). classifying digitalized workers’ documents and offering control reports by type of document. In Human Resources. starting live use of this version in August in Peru. the digitalized accounting books. With the Finances Team. -Implementation of the Perimeter Closed Television Circuit System at the Calixto Romero Plant in Piura. effective twoway communication and strong relations among Alicorp. Investor Relations In September 2010. we worked in upgrading the SAP system to the ECC 6. We established the Talking to the Management System to follow up on discussions of the management offices with their next level staff. and the Callao and Santa Rosa Mills. among other things. worker. we created the Investor Relations Unit with the primary purpose of achieving higher visibility. This system handles the minutes of the meeting and assists in the programming of the meetings. the new Liquidity Planner and the Identified Customer Collection system. we implemented the Quality Control System (QM). effective date. In Alicorp Argentina. the Sidsur Plant. In Supply Chain. Ecuador and Colombia and in September in Argentina. we installed the Telephone Sales System and the new Incentives System for their work force and Commission Payment System for the DEX. the Animal Nutrition Plant in Trujillo. -Implementation of access control equipment for personnel (metals detector) and vehicles (inspection mirrors) in all Alicorp plants and buildings countrywide.

com.com.com/watch?v=zPZpx8ifZHc Virtual tour of the oils plant: http://www.pe/espanol/ accionistas.html Youtube Company Videos: Institutional video: http://www.A.youtube. Shareholders’ annual return 5 Years (2006-2010) Alicorp S.A.A.A.com/watch?v=sKRzTtoK6LE Recover Program http://www. Shareholders’ Meeting The Annual Shareholders’ Meeting was held on March 30th. Investment Share Listed in the Lima Stock Exchange under the symbol: ALICORI1 Contact Information Investor Relations María Alejandra de la Puente Investor Relations Officer (511) 315-0800 (511) 315-0809 For matters concerning information on stock ownership and payment of dividends.A. 2011. Common Share Voting shares Listed in the Lima Stock Exchange under the symbol: ALICORC1 Performance Data The chart below shows the shareholders´ annual return for common and investment shares of Alicorp S.bvl. and compares it to the annual return of the Lima Stock Exchange Indexes (IGBVL and ISBVL). which reflects adequately the situation and potential of the company. So that.youtube.com/watch?v=WVcVnWpaqUM Source: Lima Stock Exchange (www.youtube. for the past five years (as of December 31st) .com. .com/watch?v=VwwqQkjPC1c Virtual tour of the cookies plant: http://www.com/watch?v=5YfIBQ1TgGE Durum Wheat Program http://www.com/watch?v=ff-VX4Bt-Y8 Virtual tour of the sauces plant: http://www.Alicorp 104_105 financial community.youtube. please contact the Securities Department at (511) 215-4130 or (511) 226-8368.pe Annual Report Online: http://www. at the Headquarters of Alicorp S.youtube. Alicorp obtains a fair market valuation.youtube. on the Internet Company website: www.alicorp.A.alicorp. and other constituencies.pe) Note: The annual return has been determined using the first and last business day of each year as range.

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“Alicorp nos hace sentir en casa y nos cuida.Negocio Consumo Masivo Perú . a la vez que exige a los trabajadores entrega y profesionalismo”. Henry Olguín Jefe de Cuentas Claves .

and it also expects dedication and professionalism from its workers”.“Alicorp makes us feel at home and takes care of us.Consumer Product Goods Business Peru . Henry Olguín Key Account Chief .

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