Home Tetra Laval Annual report DeLaval Comments by the CEO

Comments by the CEO

DeLaval enjoyed another excellent year in 2021 with strong growth in almost all geographies and product areas, despite market challenges primarily related to the pandemic.

Overcoming market challenges to drive strong business growth

DeLaval enjoyed another excellent year in 2021 with strong growth in almost all geographies and product areas, despite market challenges primarily related to the pandemic.

Growing demand for milk drives our market

Sales growth amounted to 5.5 per cent and customer orders increased 9.4 per cent year on year. Sales grew for the fifth consecutive year and 2021 was our third record year in a row. We are very grateful for the continued trust our customers have shown us.

Our business was driven by a strong global market demand for milk, with an increase in the home consumption of dairy products that more than compensated for the effects of schools and restaurants locked down around the world.

Sales of our rotary parlours grew by almost 50 per cent, primarily driven by strong demand in China and the US where customers invested in new capacity to meet the growing need for milk. We also saw a strong demand for DeLaval VMS™ V300 and V310, our robotic milking systems, as well as our various InService™ concepts where our subscription models grew for dairy consumables significantly.

Overcoming challenges through dedication, innovation and agility

Throughout the year, our top priority has been to safeguard the health, safety and well-being of our employees. Coupled with a strong focus on execution in our operations, this enabled our teams to continue to serve our customers – who depend on us in their everyday dairy operations.

Turbulence in the global supply chain meant that we had to deal with component shortages, which disrupted our operations and even meant that our teams had to adapt or redesign some of our products during the year. New ways of working were also introduced to keep farms running and operations intact. For example, we installed and commissioned equipment at remote dairy farms assisted by digital tools and advice from engineers thousands of miles away – something that would have been inconceivable just a few years ago.

Our strong corporate culture, always with a clear customer focus and a ‘can do’ attitude, has been paramount as it guided our everyday operations and helped us manage the challenges posed by the ever-changing pandemic situation.

Making sustainable food production possible

As a company that enables farmers to do more with less and reduce the environmental impact of every litre of milk they produce, contributing to sustainable food systems is our reason for being. During the year, we supported our customers to reduce their environmental footprint while improving food production, profitability and the well-being of the people and animals involved.

This is by far the greatest contribution DeLaval makes to the UN Sustainable Development Goals and a more sustainable society. Our focus on product innovation remained strong and supported us in fulfilling our vision ‘We make sustainable food production possible’.

We naturally also worked to minimise the impact of our own operations through reducing waste and energy consumption as well as increasing resource efficiency.

Our ongoing product innovation

Several new products were launched in 2021 including new versions of our E-series rotaries, an all-new manure robot, DeLaval robot collector RC, and DeLaval Flow-Responsive™ Milking. The work to invent truly sophisticated digital services with sensor technologies that use artificial intelligence and machine learning progressed well. These and other technologies ultimately drive sustainability and more sustainable food production, as they provide farmers with a basis for better decision making.

Outlook for 2022

Strong growth for our products and services is expected to continue in the foreseeable future and we will maintain our focus on innovation with automation and digital solutions as the focal point. We will also continue to drive our sustainability agenda. This will involve working together with universities, specialists and customers, and seeking partnerships with others in the industry as well as maintaining a dialogue with policymakers.

While I am very pleased with how our business was managed in 2021, the challenges in the global supply chain are not yet over. We will remain committed to serving our customers and will constantly find new and improved ways of working in this ever-changing climate.

Summing up, as I reflect on my first year as President & CEO at DeLaval, our business has a very strong market position backed up by our highly engaged and passionate employees. We also have high customer satisfaction and a strong innovation agenda that helps farmers to run their operations sustainably.

DeLaval will continue to lead and make sustainable food production possible.

Paul Löfgren