Thank you to our Norco

employees, Co-operative
members and customers
who feature in the annual
report photography.
Your time and participation
is greatly appreciated.

www.norco.com.au

Annual Report 2014

An Australian, farmer owned dairy co-operative since 1895

Norco’s Purpose
Norco’s purpose is to build wealth, security
and sustainability for our shareholders,
business partners and employees.
We achieve this by:
• maintaining a diverse and strong range of
businesses;
• being a competitive regional purchaser and
supplier of milk; and
• creating integrated solutions for our partners.
Norco’s Values
Norco applies a common set of values to everything it does.
These values include:
Respect
• We respect our shareholders, employees, business partners
and customers.
• We respect a diversity of views and opinions.
• We encourage and support people to grow as individuals
and contributors to our organisation.
• We respect our heritage and legacy.
• We respect our natural environment.
Responsible
• We are responsible for preserving the co-operative
principles.
• We are responsible for our actions and our performance.
• We are responsible for providing a safe work environment.
Efficient
• We seek to add value in everything we do.
Innovation
• We seek to consistently improve through innovation.
Community
• We seek active involvement in our communities.
NORCO RURAL BRANCHES cont.
BEAUDESERT
9A Thiedeke Road BEAUDESERT QLD 4285
Phone: 07 5541 4882 Fax: 07 5541 1025
BELLINGEN
1076 Waterfall Way BELLINGEN NSW 2454
Phone: 02 6655 9792 Fax: 02 6655 2266
BOWRAVILLE
51 Carbin Street BOWRAVILLE NSW 2449
Phone: 02 6564 8648 Fax: 02 6564 7425 Phone: 07 4168 3060 Fax: 07 4168 2996
BUNDABERG
71 Gavin Street BUNDABERG QLD 4670
Phone: 07 4151 7883 Fax: 07 4154 4341 Phone: 02 6672 2311 Fax: 02 6672 5120
CASINO
136 Dyraaba Street CASINO NSW 2470
Phone: 02 6661 2100 Fax: 02 6662 6007
COFFS HARBOUR
24 Isles Drive SOUTH COFFS HARBOUR NSW 2450
Phone: 02 6658 0393 Fax: 02 6658 0374
DUNGOG
Stroud Road DUNGOG NSW 2420
Phone: 02 4992 1087 Fax: 02 4992 3000
GLEN INNES
165 Lang Street GLEN INNES NSW 2370
Phone: 02 6732 2162 Fax: 02 6732 5642
GLOUCESTER
Cnr Church & Phillip Streets GLOUCESTER NSW 2422
Phone: 02 6558 9600 Fax: 02 6558 9666
GRAFTON
19 Queen Street GRAFTON NSW 2460
Phone: 02 6643 5630 Fax: 02 6642 7245
HEATHERBRAE
9 Hank Street HEATHERBRAE NSW 2324
Phone: 02 4987 6500 Fax: 02 4987 6099 300-312 Anzac Ave TOOWOOMBA QLD 4350
KEMPSEY
3 Kemp Street WEST KEMPSEY NSW 2440
Phone: 02 6562 6393 Fax: 02 6563 1020 120 Allora – Clifton Road ALLORA QLD 4362
KINGAROY
97 River Road KINGAROY QLD 4610
Phone: 07 4163 6310 Fax: 07 4162 4992
KYOGLE
Willis Street KYOGLE NSW 2474
Phone: 02 6632 2920 Fax: 02 6632 1221
LISMORE
105 Wilson Street SOUTH LISMORE NSW 2480
Phone: 02 6627 8266 Fax: 02 6621 2286
MACKSVILLE
Tilly Willy Street MACKSVILLE NSW 2447
Phone: 02 6568 4057 Fax: 02 6568 2308
MURGON
21 Lamb Street MURGON QLD 4605
MURWILLUMBAH
17 Buchanan Street MURWILLUMBAH NSW 2484
STUARTS POINT
906 Stuarts Point Road STUARTS POINT NSW 2441
Phone: 02 6569 0955 Fax: 02 6569 0983
TAREE
5 Grey Gum Road TAREE NSW 2430
Phone: 02 6551 2999 Fax: 02 6551 2522
TENTERFIELD
445 Rouse Street TENTERFIELD NSW 2372
Phone: 02 6736 5902 Fax: 02 6736 2270
WINDERA DEPOT
2814 Murgon – Gayndah Road WINDERA QLD 4605
Phone: 07 4168 6186 Fax: 07 4168 6214
WOOLGOOLGA
16 Featherstone Drive WOOLGOOLGA NSW 2456
Phone: 02 6654 2905 Fax: 02 6654 1031
WOOLGOOLGA CARTON SERVICES
8 Bosworth Road WOOLGOOLGA NSW 2456
Phone: 02 6654 8078 Fax: 02 6654 0103
NORCO RURAL RETAIL BRANCHES – NORCO BOWDLERS
NORCO BOWDLERS – TOOWOOMBA
Phone: 07 4637 3300 Fax: 07 4637 3399
NORCO BOWDLERS – ALLORA
Phone: 07 4666 2210 Fax: 07 4666 3520
NORCO BOWDLERS – QUINALOW
3 Myall Street QUINALOW QLD 4403
Phone: 07 4692 1333
contents

Corporate Profile 2
Facts at a Glance 3
Chairman’s Report 4
Chief Executive Officer’s Report 7
Business Unit Reports:
Norco Foods 10
Milk Supply  12
Norco Rural / Agribusiness 14
Financial Management 17
Norco People 18
Directors’ Report 20
Auditor’s Independence Declaration 26
Corporate Governance Statement 27
Financial Statements 32
Independent Auditor’s Report 58
Corporate / Branch Directory 60

1
 corporate
profile
Norco’s heritage, provenance and structure are tangible
points of difference in the market place, both domestically
and internationally. After all, being able to describe your
business as an Australian, farmer owned dairy co-operative
with a history dating back to 1895 is quite a unique
proposition and one that is finding favour with consumers
and business partners alike. There has been a resurgence
of support and a renewed appreciation by the public of
Norco’s owners – our milk supplier members who supply
quality milk 365 days a year; consumers do see the value
in supporting an industry that provides fresh, local milk
that they can enjoy as part of their daily diets. In return,
Norco pays to our milk supplier members a competitive
milk price and makes a commitment to collect every litre
of milk offered for sale by them for the duration of their
membership. This milk is processed by Norco and then sold
into the fresh drinking milk market or is value added by the
Co-operative, including being utilised to manufacture a
range of quality dairy products.
Behind the name Norco is a diverse business that is not
only about milk, but importantly the sum of all of the parts
collectively contribute to the overall profitability of the Co-
operative. This collective contribution, in turn, supports the
sustainability of our members because available profits are
paid out in the form of improved milk prices.
At Norco, we operate the following businesses:
Norco Foods – includes three factories (Labrador
and Raleigh milk factories and the Lismore ice cream
manufacturing plant). Labrador and Raleigh specialise in
chilled milk products such as whole milks, modified milks,
flavoured milks, cream and custard products, while Lismore
specialises in ice cream products, stick confectionery,
sorbet and yoghurt.
Milk Supply – manages the daily receipt of milk from
our milk supplier members, including managing milk
movements ex farm and factory, working very closely
with Norco Foods. Field officers assist our milk supplier
members with their dairy operations to ensure that our
milk is of a high quality.
Norco Rural – consists of 29 rural retail outlets throughout
south east Queensland and northern New South Wales.
These stores provide rural merchandise and farm supplies
for “the person on the land”. As a co-operative, we
encourage our milk supplier members to shop at Norco
Rural to obtain patronage rewards, further boosting their
total return from supplying milk to Norco.
Norco Agribusiness – manufactures stockfeeds (bagged
and bulk) from mills located at Lismore, Windera and
Toowoomba. Bagged product is mainly distributed
through Norco Rural stores. Bulk stockfeeds are delivered
2
direct to farm, including to Norco’s milk supplier members
to support their dairy operations.
Key facts about Norco for 2013/14 include:
• 304 active members on 181 dairy farms and a
membership capital base of $7.9 million.
• Revenue $430 million.
• Net profit of $0.5 million.
• EBITDA (earnings before interest, tax, depreciation and
amortisation) of $7.688 million.
• Total debt $34.3 million.
• Milk intake of 163.2 million litres from member suppliers.
• Average farm gate milk payment to member suppliers
53.25 cents per litre.
The 2013/14 financial year has been about bedding down
change and then preparing for more change and a bigger
business. As reported last year, Norco reacquired the
“Front End” (marketing, distribution and sales) of the Norco
Milk business from Fonterra on 9 November 2012. Since
then considerable time, effort and resources have been
dedicated to turning around the performance of the route
trade business and the results that are starting to come
through are very encouraging. Also announced last year
was Norco’s winning of the Coles’ private label south east
Queensland fresh milk contract business, to commence
from 1 July 2014. Again, considerable time, effort, capital
and resources have been expended to prepare for
this significant contract, which effectively doubles our
throughput at the Labrador milk factory and which will
be a major contributor to Norco having a much bigger
and more profitable business in 2014/15 and beyond. The
work undertaken with strategic partners during 2013/14 to
develop a capability to export fresh milk to China came to
fruition in June 2014, when the first commercial shipment
of milk sourced from Norco member farms was packaged
and air freighted to China. This was a significant milestone
for Norco and the dairy industry generally, and opens up a
whole new market and value chain for our members’ milk.
Norco Rural has also continued with its expansion program
during 2013/14 with the addition of three retail outlets
which will further contribute to a bigger, more profitable
business into the future.
The Board’s strategy remains firmly focused on creating
a sustainable farm base which can produce quality
dairy produce for an ever growing customer base, both
domestically and internationally. The Norco Board,
however, recognises that more needs to be done to
support our members’ milk price. It is that need which will
remain the focus of the efforts of the Board and Norco’s
management into the future.
 facts
at a glance

2013/14 0.5

2012/13 0.4 Norco Foods 468

2011/12 5.7 Norco Rural 175

2010/11 4.2 Norco Agribusiness 44

2009/10 2.3 Corporate 18

TOTAL NET PROFIT STAFF EMPLOYED

Millions $ As at 30 June 2014
(includes permanent, part-time & casual staff )

2013/14 181 2013/14 933 2013/14 163

2012/13 159 2012/13 947 2012/13 151

2011/12 160 2011/12 923 2011/12 149

2010/11 161 2010/11 851 2010/11 137

2009/10 165 2009/10 866 2009/10 143

NUMBER OF MEMBER FARMS AVERAGE MILK PRODUCTION TOTAL MEMBERS’ MILK INTAKE
PER MEMBER FARM Millions Litres
000’s Litres
PATRONAGE
MILK PRICE

SUPPLIERS’

TOTAL AVE
AVE TOTAL

DIVIDEND
AVE BASE

STEP UPS

RETURNS
MILK PAY

MEMBER

2013/14 53.25 - 53.25 0.14* 0.51 53.90

2012/13 51.50 0.24 51.74 - 0.45 52.19

2011/12 51.28 1.43 52.71 0.30 0.42 53.43

2010/11 50.54 1.50 52.04 0.23 0.41 52.68

2009/10 53.40 0.71 54.11 0.18 0.36 54.65

TOTAL MEMBER RETURNS

Cents per Litre *Dividend proposed for consideration at 2014 Annual General Meeting
3
 CHAIRMAN’S
report

Your Board of Directors is reasonably satisfied with the

financial outcomes achieved by the Co-operative in the
2013/2014 financial year. We have improved Norco’s
EBITDA by 17.6 percent when compared to the prior year
(from $6.5 million to $7.7 million), we are able to propose
to members that they approve a three percent dividend
at the 2014 Annual General Meeting (your Board was
not able to recommend a dividend last year) and we
have raised the average milk price paid to our members/
suppliers from the prior year’s 51.74 cent per litre to 53.25
cents per litre.

These financial outcomes are the result of careful strategic

planning over the medium to longer term. Three years ago
your Board and Norco’s senior management developed
our current strategy and we have been successful in
achieving each of the goals which we set for Norco under
that strategy. The achievement of those goals has been the
result of persistent effort by the Board and management,
including regularly reviewing the strategy and our
progress with regard to each of our strategic goals.

When we developed our current set of strategic goals

we determined that it was imperative that Norco build
a business and customer mix which protects the Co-
operative and our members from the volatilities of
the global commodity markets. We were significantly
hampered in building that business and customer mix
by the commercial restraints which were part of our
agreement with Fonterra to operate the “Front End”
(marketing, distribution and sales) of the Norco milk
business. Consequently, when the opportunity arose to
reacquire the Front End from Fonterra your Board decided
to make the very significant long term investment which
was required to remove those commercial restraints.

Some of the commercial activities which we have been

able to pursue as a consequence of the strategic direction
we took three years ago are discussed below.

Strengthening Norco’s Relationships with Major

Retailers

Norco’s ability to negotiate directly with the wholesale and

retail sectors now that we have reacquired the Front End
has allowed us the opportunity to persuade major retailer
Coles of the benefits of working with an Australian dairy
farmer owned co-operative. Consequently, Coles awarded
Norco a five year contract to supply approximately 65
million litres of milk annually in northern New South Wales
and south east Queensland commencing on 1 July 2014.
Subsequently, your Board determined to invest over $6
million in the Labrador site and take on an additional 54
members/suppliers to ensure that we are able to meet
our obligations under that contract. I can report that the
4
first two months of trading under the Coles contract have
exceeded our expectations.
In addition to winning this valuable contract with Coles,
we have also strengthened our relationships with both
Aldi and Woolworths and we are growing the volume of
our sales to these customers as a consequence.
Expansion of the Route Trade
The Norco brand has always held a strong position in
the route trade in regional areas in New South Wales and
Queensland. Our ability to invest in a marketing campaign
and add additional Sales Representatives to our team
following the reacquisition of the Front End has resulted
in Norco increasing our brand presence, which in turn has
resulted in improved sales volume and profit.
Export of Fresh Milk
Following careful development of this opportunity, Norco
commenced a program to export fresh milk to China in
commercial volumes in June 2014. It was recognised early
in the development of this opportunity that we would
need to access specific skills if we were to be successful. By
engaging the services of an internationally acknowledged
expert in dairy, who has significant experience in
facilitating the export of food products (including dairy
products) to China, we were able to avail ourselves of the
required skill set. Ensuring that we sourced the highest
quality milk from our suppliers, maintained product
integrity in transport, satisfied the stringent testing regime
by the CIQ (the Chinese inspection and quarantine service)
and met the end customers’ expectation to achieve a
premium price were also critical factors in achieving our
goal of exporting commercial quantities of fresh milk to
China. Our ability to satisfy all of these requirements has
ensured that Norco as a manufacturer of premium dairy
products is held in high regard, not only in China but in
international markets more generally.
Adding Value
Norco has a policy that we will accept all of our members’
milk. Our goal has always been to add value to that milk
by way of our manufacturing processes. For instance,
Norco’s ice cream business unit (ICBU) based at Lismore
plays a pivotal role in adding value to milk which is
surplus to our fresh milk requirements. In that regard,
our challenge always has been to operate a profitable ice
cream manufacturing business. It was recognised in our
strategic planning that we needed to invest significant
capital in our ice cream manufacturing plant in order to
improve efficiencies. Those improvements would, in turn,
ensure that we remain competitive in the market place.
Over the last three years Norco has made over $5 million
of capital investment in our ice cream plant in order to,
for instance, increase our freezer capacity, commence a
plastic moulding business and automate packing lines.
That investment has been critical in allowing Norco to
bid for and win increasing volumes of profitable business,
both from existing customers and from new customers.
The enhanced profitability of the ICBU has been crucial in
giving your Board the capacity to increase our members’
average milk price.
Norco Rural and Norco Agribusiness are also crucial
business units which assist your Board to support
members’ milk price. The significant improvement in
profit over the last 12 months in Norco Rural and Norco
Agribusiness has come about through increased sales, the
purchase of an additional rural store at Heatherbrae and
the commencement of two agency outlets at Gloucester
and Murgon. Norco Rural and Norco Agribusiness have
also exited businesses which haven’t added value to
Norco. In addition, these business units have closely
monitored costs and operational efficiencies. In real
terms, when combining the benefits of Norco’s supplier
patronage scheme rewards to members and the profit
derived from Norco Rural and Norco Agribusiness, the
contribution to members from these businesses is
equivalent to an additional 2.5 cents per litre on our
members’ average milk price.
Compulsory Share Contribution Scheme
On 30 June 2014 the then existing Compulsory Share
Contribution Scheme terminated in accordance with its
terms. Over the five year term of operation of that scheme
$3,350,222 was raised by members. All contributions
raised under that scheme were applied to repaying capital
to our “dry shareholders”.
A new Compulsory Share Contribution Scheme, which
was approved at the 2013 Annual General Meeting,
commenced on 1 July 2014 and will operate until 30
June 2019. That scheme includes a reduced compulsory
component, down from half a cent per litre to a quarter of
a cent per litre.
The Make Up of the Board
In accordance with Norco’s rules, in 2013 two Board
positions became vacant. One position was for a Supplier
Director from the Southern Region and the other position
was for a Supplier Director for the Northern Region. Peter
Neal offered himself for re-election to fill the Southern
Region position and was re-elected unopposed. Tony
Wilson offered himself for re-election to fill the Northern
Region position and was successful in a ballot involving
two other candidates.
5
 On the basis of legal advice received by your Board, in
June 2014 it was determined that due to technical issues
arising from changes to farm ownership and operation
Peter Neal was no longer an active member of Norco. As
a consequence, under Norco’s rules Mr Neal no longer
qualified to hold the position of Supplier Director. The
legal advice the Board sought in relation to this issue
indicated that the problem relating to Mr Neal’s active
membership status could not be remedied by the Board,
or even the members, acting retrospectively.
Subsequently, Mr Neal took the steps necessary to resolve
the issues regarding his active membership status and as
a consequence the Board has approved his reinstatement
as an active member of Norco. Given that, as a result
of his reinstatement, he was then qualified to hold the
office of Supplier Director Mr Neal nominated to stand for
election to fill the casual vacancy for a Supplier Director
from the Southern Region which was created as the result
of his vacation of office. Mr Neal was the only nominated
candidate to fill that vacancy and at the time of writing
this report I can confirm that Mr Neal has resumed his role
on Norco’s Board of Directors.
The Future
As we continue to implement your Board’s strategy
for Norco it is anticipated that the Co-operative’s
sales revenues will increase further and the trending
improvement in our overall profitability will be
maintained. The global interest in Norco’s heritage and
provenance now means that we have a real point of
difference in the market place. Creating a sustainable
6
farm base which can produce quality dairy produce for
an ever growing customer base, both domestically and
internationally, is a challenge which is acknowledged by
your Board. While the increase in our members’ average
milk price during the 2013/2014 financial year and the
announcement in June 2014 of a further significant
increase in Norco’s average milk price for 2014/2015 are
steps in the right direction, your Board recognises that
more needs to be done to support our members’ milk
price and, consequently, their own efforts to create and
maintain sustainable dairy enterprises. It is that need
which will remain the focus of the efforts of your Board
and Norco’s management into the future.
In Conclusion
Finally, I would like to thank my fellow Directors and
Norco’s management for their ongoing support and
commitment to ensuring that the entire Norco team can
operate in an environment whereby the Norco businesses
flourish. Without our members/suppliers, employees,
business partners and customers Norco could not be the
Australian Co-operative we are today and will continue to
be in the future.
(signature)
GREG McNAMARA
Chairman
Board of Directors
CHIEF EXECUTIVE OFFICER’S
report

Business overview 2013/14
The 2013/14 financial year has been a challenging year;
however our Co-operative has exceeded our financial
budget once again. The collective final results for the
Co-operative have improved again taking into account
the transitional period we forecasted with the Coles
commissioning and ongoing turnaround of the Front End
business. This truly reflects on the strength of our brand as
well as the commitment and talent of all our people in the
Co-operative.
The final result for 2013/14 has enabled us to take a
strategic position to further develop our new potential
fresh milk channel into China as well as further enhance
our Coles supply contract into Queensland that
commenced on 1 July 2014. Our clear strategy both
domestically and internationally in conjunction with our
diversified business model, geographical positioning,
quality of product and strong long term relationships has
culminated in these financial results. This is reflective in
both net profit and total farmer returns in comparison to
our competitors. We have many good opportunities that
have been developed from a sound base and foundation
which can be followed through in the new financial year.
We have collectively finished the 2013/14 financial year at
an EBITDA (Earnings before Interest, Tax, Depreciation and
Amortisation) level of $7.688 million which is 17.6 percent
up on last year. This is a great result and is a material
improvement on the prior year especially when you take
into account all the projects that have been going on
during the year. Our core debt at the end of the 2013/14
year was 18.6 percent up on the previous year due to the
planned upgrade and commissioning of Labrador for the
Coles contract as well as the ongoing turnaround of the
re-acquired Front End business and the increased working
capital resulting from our growing business.
Our Norco Foods business division, consisting of the Ice
Cream Business Unit (ICBU), Norco Milk and Milk Supply,
achieved an overall EBITDA on par with last year. This was
a good outcome considering the volatility of the market
throughout the year. Milk Supply was down on last year
due to the average milk price increase of 1.51 cents per
litre (cpl). A further 3 cpl increase to the average milk price
has been successfully achieved for the commencement
of the 2014/15 financial year. Norco Milk was down 16.3
percent due to last year’s results containing four months
of the higher Fonterra profit. ICBU was up by a staggering
53.4 percent on last year’s EBITDA which was driven by
higher volume, improved margin and also the returns from
the new plastics division.
Our Rural / Agribusiness division had an excellent result
again with a collective result that was up on last year’s
EBITDA by 40.2 percent (Agribusiness up by 30.3 percent /
Rural up 51.5 percent).This was driven from better trading
results achieved from both our rural stores and our mills at
Lismore and Windera. The Rural team continues to focus
on operational efficiencies, improved buying, customer
service and gross margins as well as now planning for the
expansion of the Rural network over the next few years.
Supplier Patronage was up 23.4 percent on last year which
is a positive sign as it means that our members are buying

7
 more from their own business. We will continue to work
on building sales volume and margins across our Rural /
Agribusiness division.
Corporate EBITDA improved slightly on last year by 0.3
percent. This was a good reflection of ongoing tight
cost and overhead control with a now collective bigger
volume business. As we strengthen our financial position
and implement long term opportunities we will need
to continue to put further focus on the development of
our people and succession planning. Norco has further
invested in expertise, resources and infrastructure in
our Human Resources division to continue to develop,
enhance and improve all aspects of safety in our work
force. We successfully completed a Targeted Engagement
Program with WorkCover NSW this year and continue to
consult with WorkCover on safety improvement aspects
for our Co-operative.
Again this year there are a number of accomplishments
from all the teams at Norco. I have listed below some of
the key achievements from the 2013/14 financial year,
including:
• Successful commissioning of the Labrador upgrade for
the Coles contract commencing 1 July 2014.
• Successful breakthrough in creating a channel into China
for fresh milk sales.
• Improved Route business sales up by 13.2 percent on
previous year.
• EBITDA of $7.688 million (up 17.6 percent on last year).
• Net profit up on last year by 42.9 percent.
• Our average milk price for 2013/14 to our members
improved by 1.51 cpl on last year and a further average 3
cpl has been achieved for the whole of the 2014/15 year.
• Our members’ volume was up 7.6 percent on last year.
• The Rural / Agribusiness division achieved a net profit
improvement of 58.8 percent up on last year.
• ICBU achieved a net profit improvement of 83.7 percent
up on last year.
• Met and exceeded all banking covenants.
• Supplier Patronage Scheme up 23.4 percent on last year.
• Milk sales up 19.9 percent on last year.
8
Our 2014/15 key points of focus are:
• Corporate:
- To continue to focus on cost controls and efficiencies
in all overheads.
- To meet all banking covenants.
• Norco Rural / Agri Division:
- Continued focus on ongoing financial improvement
of the Rural / Agri division.
- Explore further opportunities for expansion of the
Rural network.
- Focus on collective financial improvement of our
Toowoomba site.
- Improved Rural Stores buying, improve Rural Store
network sales, service and market share.
- Increase volumes through Agribusiness mills and
Grain Trading.
- Training and development of our sales people.
• Norco Foods Division:
- Focus on Norco branded product market share and
point of difference.
- Ongoing development of strategic alliances with
Norco partners.
- Consistent milk volume pre selling.
- Improvement of milk price at farm gate.
- Ongoing research and development of future export
opportunities.
- Continued turnaround and improvement of
profitability in the Route trade.
- Capital improvements at all Norco owned sites to aid
business development.
- Training and development of our teams.
• Focus of Senior Management Team:
- Improve core businesses profitability.
-O
 ngoing development of core strategic partnerships
across all business units.
-C
 ontinued improvement of asset values and goodwill
appreciation of the Co-operative.
 -C
 ompetitive farm gate milk price and improved
shareholder return through ongoing profit
improvement across all divisions.
- I mprove member / supplier / customer service,
support and communication.
- Achieve Key Performance Indicators and budget.
- S trengthen positioning and ongoing sustainability of
the Co-operative.
-O
 ngoing focus on employee training, development,
mentoring and career / succession planning across
business units.
-C
 ontinued investment and improvement in all
aspects of Work-place Health and Safety.
- Focus on long term strategic plans.

In conclusion, I would like to thank all Norco employees,

members, suppliers, stakeholders and customers for your
support, input and loyalty to the Co-operative throughout
the 2013/14 financial year. I look forward to working
with you all to continue to strengthen and improve the
long term sustainability of Norco in the 2014/15 financial
year. We have a solid and well built foundation from the
previous six years hard work and we will continue to build
on this platform. The effort and commitment of our valued
teams and all our stakeholders has once again culminated
in the overall results being achieved. Thank you all and
well done everyone.

(signature)

BRETT KELLY
Chief Executive Officer

9
 BUSINESS
UNIT
REPORTS NORCO FOODS
Our overall objectives for Norco Foods’ are to:
1. be a cost effective and efficient operation that provides increasing competitive
advantages for our clients whilst increasing profitable returns for our shareholders; and
2. increase the value and volume of our members’ milk.

Ice Cream

Our Ice Cream Business Unit (ICBU) continues to build on its reputation of providing
excellent quality products to our business partners and to their consumers who are not
aware of where the product is produced and by whom, when they pick up some 60 or so
retailer branded products from supermarkets around Australia. However we know, which
makes us extremely proud, particularly when Norco receives recognition from industry
supported awards as well as encouraging comments received from our trading partners for
the ongoing quality products we produce and the service we provide.

This year saw the first full year of our operations taking advantage of the capital programs
that had been rolled out in previous periods. The automation and capital upgrades have
allowed us to maintain our pricing competitiveness whilst growing our ability to produce
increasing stocks over several of our production lines. Our full year net profit result was up
83.7 percent on the prior year, giving us one of the highest if not the highest trading results
for the ICBU ever. A combination of a very warm and lengthy summer, new contracts, new
business and efficiencies gained through automation, operational improvements and
revenues provided by our new plastics division, all assisted in providing a pleasing and
rewarding result for the year. With the support from our experienced team along with an
incredible business and processing knowledge and the “can do” attitude, our business was
able to generate this pleasing result.

The year ahead will again be a one of excitement and growth with several of our retail
clients delivering into the market a large number of new products generated and
produced by Norco. Additionally our export focus continues to grow with a planned roll
out of 16 new Norco branded export products, destined for the Asian markets this trading
year. We are also expecting, on the back of a hot and long Australian summer, another
successful year for the ICBU.

Norco Milk

A primary focus for the milk production side of our business during 2013/14 was the
capital upgrade of $6.4 million undertaken at the Labrador facility to allow our business, as
of 1 July 2014, to start to feed into the Coles Queensland distribution facility an additional
50 million litres of Coles branded milk (in addition to Norco’s existing 15 million litre
contract). Our team, ably led by Ian Foote, General Manager – Operations, completed a
massive task within the short time available, ahead of schedule and on budget and are to
be duly congratulated for the commitment and diligence provided to see the project come
to life in supplying Coles from 1 July 2014.

The new Coles five year relationship also came with some additional benefits with the
ability to supply Norco branded products across a range of white and flavoured milks into
an increased number of Coles stores in the Brisbane and Toowoomba regions along with
supply to all the Coles Express stores in Queensland.

This year also saw a step change in our route trade business, albeit towards the last half of our
year, based on new business gained in the northern reaches of our territory and new supply
contracts won across our wide territory. New Norco products (cheese and juice) have made
it into the market which has allowed us to increase our basket size of sales and opportunities
to our current clients whilst attracting new customers to join our supply base. In particular,
our success has come from advancing into new business trading areas, such as Toowoomba,
Brisbane, the Sunshine Coast and Sydney, and our teams will use the learnings obtained from
these successful advancements as further opportunities arise in the year ahead.
10
We have made significant ground in achieving ongoing supply to the huge and exciting
Chinese market. This is what is commonly known as a “step by step” process and although
it’s still early days both the opportunity and size of the prize is substantial and one that we
will continue to foster in the year ahead. Working alongside our import business partner
Perloris Global Sourcing (PGS), the somewhat difficult and lengthy process and task of
delivering fresh milk into China by flying it from Sydney into Shanghai has now been
achieved. Now that we have been able to achieve this milestone, we have to replicate the
process and grow the customer base with which we deal whilst maintaining the integrity
and quality of our product and brand.

While growing our business via volume and margin is critical for our ongoing success,
controlling our costs in achieving this growth is just as important. Our Operations teams
have been finding and establishing reductions in operating costs and finding better and
more efficient processes on the back of our volume growth. Substantial savings from our
warehousing and distribution functions have been achieved in the second half of the year
which will have benefits for the full year ahead. Using our volume growth and the need
to establish long term partnerships with our logistics suppliers to ensure longevity of our
business relationships and standards, our Logistics teams have been able to achieve new
contracts and standards that deliver on our business requirements.

Work Health and Safety (WHS)

The safety of our employees, suppliers, clients and contractors visiting our sites is
paramount throughout our operations. Each month, safety teams made up of staff and
management from within each of our sites hold structured and minuted meetings during
which they discuss and review safety. Staff are encouraged to report safety issues if and
when they occur. Norco’s Foods’ management actively seeks out and addresses safety
concerns as they arise.

Quality Systems

Maintaining our quality systems, assurance programs and certifications is a high priority
within each of our three processing facilities. Compliance with standards as required by
Queensland Safe Foods, New South Wales Food Authority, HCCAP, ISO and various other
customer specific programs are ongoing requirements with which our team ensures
that we comply on a daily basis. Regular internal audits are carried out to ensure that
compliance to required standards and best practice is maintained. To enhance our business
in the year ahead, there has been a new addition to our Norco Foods family in the way of
a Technical Manager reporting to the General Manager Operations who will oversee the
quality systems at all of the Foods production plants.

Training and Development

Training and development for members of the Norco Foods team continues to be rolled
out across our sites. Developing the skills and qualifications of our team members
from apprentices to our most experienced staff is crucial for both personal and career
development and allows us to provide real in-house opportunities for our staff to be
involved in activities that allow Norco Foods to remain efficient and competitive.

The Year Ahead

The year ahead is shaping up to be a successful and rewarding one for Norco Foods with
our eyes firmly fixed on expanding our territory both domestically and internationally.
Additional volume via the Coles contract and efficiencies gained from our capital upgrades,
together with savings generated via our Operations team, will all assist us to deliver new
incremental and sustainable results in the year ahead.

Andrew Burns
General Manager Sales and Marketing Norco Foods 11
 BUSINESS
UNIT
REPORTS milk supply
In summary, the 2013/14 year for Norco milk suppliers saw a challenging environment
with highly variable and difficult seasonal conditions throughout most of the year. This
combined with high cost / low availability of feed, resulted in an adverse impact on
traditional seasonal farm volumes. For the Norco Milk Supply team, along with the Norco
Rural and Corporate divisions, it was important to provide as much support as possible
with unbudgeted increases to milk price, continued on-farm support from our field officers,
and providing interest free accounts through our Rural Stores / Agribusiness divisions.

In the 2013/14 year, the Milk Supply team’s major challenge was to secure the necessary
milk volumes to supply the Coles contract of 65 million litres as at 1 July 2014. A strategic
supply plan was initiated to secure a portion of the required milk early within 2013/14,
with the balance of supply beginning on 1 July 2014. The early milk was allocated in part to
service a one year bulk milk sales agreement by using spring flush milk in spring / summer,
and the new member supply in autumn / winter 2014 to cover the full year. In combination
with promoting increased supply from our members, the new supply also assisted in
managing the financial price exposure to the high commodity market and third party milk
purchases in the second half of the year. The results of this strategy include:

• Norco members’ total milk supply for the 2013/14 year was 163.2 million litres – up 7.6
percent from the prior year 2012/13.

• Assist in the increased milk pay of an average 1.51 cpl versus 2012/13 ($2.5 million)
through Base price, New Milk pricing and the increase in base milk allocations for spring
2013.

• Increase in revenue to $91.4 million versus 2012/13 of $84.8 million (or 7.8 percent
increase)

• A flattening of the supply curve ratio between autumn / spring of 1.01 litres (down from
1.41 litres in 2012/13) providing a flat line supply to reduce exposure to low return spring
bulk milk or milk commodity sales.

• Successfully secure the required milk as at 1 July 2014 to service our bottled milk
requirements for not only the Coles contract, but further increases in volume through
Aldi, export sales and the increased retail and route trade volumes.

Securing the new member supply was not an easy task, It was achieved with significant
effort by our Milk Supply Manger, Jeff Collingwood and Milk Supply Administrator, Ellie
Hoskins. The process did provide, however, a positive insight into the advantages of an
Australian owned dairy co-operative model and the outcome reflected the measure of
goodwill that Norco has achieved in the northern dairy industry.

Industry Considerations

The Norco Board and Milk Supply team significantly engaged with industry and farmer
networks over the 2013/14 year. A particular focus has been to increase links with Dairy
Australia for the purpose of assisting Norco in dairy industry wide issues such as animal
welfare and export related industry assistance. At a regional level, Norco also supported
and engaged industry through our Milk Supply team and Norco members with the
University of Queensland at Gatton, the various regional dairy farmer groups and Norco
regional supplier networks.

12
There is little doubt that the continued shortfall of farm milk supply for the total
Queensland drinking milk market is a serious concern to the industry as a whole. In
2013/14 Norco maintained the balance of farm milk required (from our own total supply
base) to service our factories and customers throughout the year. While the volume
situation in Queensland is not favourable at present, the Norco Board and management
strategy of gaining increased sales through the retail and export markets is providing
opportunities for growth for both individual Norco milk suppliers and for the dairy industry
within the region.

Commodity Markets

In 2013/14 the milk commodity market saw a significant increase in prices in the third
quarter of the year as strong demand from China continued. As this demand declined due
to high stock rates in the last quarter, the market pricing also declined from the historic
highs and ended the year approximately 12 percent down from the start of the financial
year. As we have seen since that time (as the prices have continued to decline), the high
volatility of commodity markets requires Norco to manage risk and protect the best
possible return for every litre of member’s milk.

While it is not possible to eliminate all risk associated with commodity price exposure, the
combined strategies of longer term balancing of our milk intake to sales requirements,
expanding the export market for fresh milk (which is not exposed to the commodities
market) and managing third party purchasing of milk components, we look to achieve a
balanced supply strategy that provides an opportunity for consistent returns to the Norco
supply members’ over the long term.

The Year Ahead

While the targeted farm intake volumes were achieved for the 1 July 2014 start of the
Coles contract, the Norco Foods’ sales teams continue to apply pressure to the Milk Supply
team with increased sales volumes through our retail, route and export business channels.
The challenge for the Milk Supply team will be to assist the business and milk supplier
members through this growth stage while the total regional supply base is in under-supply
conditions, with continuing variable climatic conditions and the majority of other northern
processor milk contracted for the long term. A combined strategy of increasing Norco’s
own farm supply growth and building on existing commercial relationships will be key to
managing and balancing milk volumes in 2014/15 and beyond.

Rob Randall
General Manager Norco Milk Supply 13
 BUSINESS
UNIT
REPORTS norco rural / Agribusiness
The Business and Market Conditions

The 2013/14 financial year was a challenging but rewarding period for Norco Rural /
Agribusiness. This year represents year three of our five year strategy with growth in sales
sustained despite challenging seasonal conditions, expansion plans being executed and the
group’s profit growth continued.

The Norco Rural / Agribusiness five year strategic plan has the overarching objective of
business stability, growth and increased profit contribution to the overall Norco business.
The improved profit results that the division has delivered during years one and two has laid
the foundations for sustained improvement in business performance and growth in financial
contribution. The underlying principles of:
• Strategic Partner alignment and support;
• Continual operational improvement; and
• Gross Margin growth

have delivered year on year increased profit and the opportunity to actively pursue and
implement business expansion initiatives.

2013/14 presented significant seasonal challenges and major management issues for many
of our clients. A number of the regions that Norco Rural / Agribusiness service have for the
second consecutive year experienced a dry spring followed by a dry summer. Last year the
period ended with substantial rainfall events during December and January. Unfortunately,
this was not the case this year and the dry summer intensified and continued into autumn
and winter.

The dry spring and summer impacted many regions, and was particularly evident along
the Tablelands, Mid North Coast, Darling Downs and Burnett areas. The dry resulted in a
significant reduction in summer crop plantings across the cropping zones that we service.
Areas lucky enough to plant and establish a crop saw the dry conditions substantially
impact crop performance and yield. The drought conditions along the Northern Tablelands
have impacted business conditions and performance. This region has seen many producers
make the difficult management decision to off-load livestock and reduce numbers. The
livestock sell off along the Tablelands has been significant, particularly during the post
Christmas period.

Whilst very dry, the regions of the North Coast, south east Queensland and the Sunshine
Coast did receive small but timely rainfall events that to some extent maintained crop and
pasture growth. Unfortunately, during the latter part of summer and autumn, conditions
deteriorated and some local government areas moved back into drought declared zones. The
off-loading of livestock in these regions increased post Christmas and continued throughout
the second half of the year.

Two consecutive dry spring and summer periods have had a significant impact on the New
South Wales sugar cane industry. New crop plantings, crop establishment and growth and
crop yield have all been affected. The NSW Sugar Co-op is this year expecting to harvest a
significantly reduced crop, with early forecasts putting the current season harvest as much as
50 percent down on the long term average and down on last year’s disappointing harvest.

The horticultural market was devastated by cyclone, intense wet weather and orchard
damage during 2012/13. This sector enjoyed better weather and market conditions during
2013/14. Farm management programs have been playing catch-up as orchards move back
into full production and business performance in this sector has been solid during the last
twelve months.

14
As reported last year, Norco Rural commenced its expansion program with the purchase
of Pivot Agri in Taree, which represented the first business acquisition since 2007. During
2013/14 the group has added an additional three retail outlets to the business. In October
2013 the opening of Norco Rural Gloucester was announced and this business unit
operates as an agency with our business partners, Mograni Rural. June 2014 saw the
acquisition of Hunter Rural at Heatherbrae in the lower Hunter Valley, which now operates
as Norco Rural Heatherbrae and the opening of Norco Rural Murgon which also operates as
an agency business.

The addition of three new Norco Rural retail outlets in the southern portion of our territory
within eighteen months provides Norco Rural with great market presence within this region
and complements our existing businesses at Kempsey and Dungog.

The opening of an agency branch in Murgon represents the execution of a long held
business desire to increase Norco Rural’s presence in the south Burnett region of Queensland.
The Murgon site complements our existing business operations at Kingaroy, Windera and
Bundaberg.

Norco Rural continues to seek acquisition opportunities where the acquisition has a strategic
and sound operational fit within the group.

Financial Performance

The combined business units of Norco Rural and Norco Agribusiness delivered an EBITDA
result of $4.175 million, a 40.2 percent increase on the previous twelve month trading period.
Norco Rural delivered an EBITDA increase of 51.5 percent on the prior twelve months. The
result in Norco Rural was driven by several factors including:
• Sales growth of 9.6 percent on last year.
• Transaction numbers increased by 7.6 percent on last year.
• Gross profit improvement of 1.2 percent on last year.
• Year on year growth in Sundry Income of 6 percent.

The group’s product categories of Dairy, Beef, Sheep, Horticulture and Hobby all produced
solid sales growth results despite the difficult seasonal conditions. The product categories of
Cropping and Sugar experienced negative sales growth and this is a direct reflection of the
tough seasonal conditions that impacted this segment of our market.

Across our five business regions, three regions experienced strong sales growth results, whilst
the Darling Downs / Burnett and south east Queensland regions experienced small positive
to negative sales growth. Lower sales of fertilizer, seed and ag chemical were the drivers of
the negative sales results in the regions that experienced negative sales growth.

Norco Rural produced solid results for several KPI benchmarks and this is a continuation of
a trend that has been established during the three years to date. Notable improvements
include:
• 49.6 percent year on year improvement in ROCE.
• 8.6 percent improvement over budgeted stock turns.
• 6.4 percent improvement over budgeted GMROI.

Norco Agribusiness delivered an EBITDA increase of 30.3 percent on the previous twelve
months and an 85 percent year on year increase in ROCE. The dry seasonal conditions have
had an obvious and significant positive impact on the volumes of product manufactured at
our two feed mills and also on the volumes of commodities traded by our trading division.

Damon Bailey
General Manager Norco Rural / Agribusiness 15
 BUSINESS
UNIT
REPORTS norco rural / Agribusiness
Total volumes manufactured were up 11 percent year on year and the current years volumes
represent the biggest volumes manufactured across our two feed mills for several years. Our
volumes of bagged stockfeed sold as ‘Norco Stockfeed’ continues to increase year on year
and volumes during the current year saw further growth of 4 percent and represents the
largest volume of bagged stockfeed that we have manufactured.

Our trading section continues to grow and volumes of grain, protein and hay traded
increased by 23.5 percent year on year. This growth occurred despite a significantly drought
affected summer crop which resulted in a major reduction in the volumes of summer crop
grains being available to trade.

Patronage

Norco members continue to support the Co-operative and the patronage scheme. 2013/14
saw significant growth in sales to members with gross sales up by 23.4 percent year on
year. The number of members who transacted with Norco Rural / Agribusiness stands at 92
percent. Patronage payments to members totalled $820,000 which is a 22.2 percent increase
on the previous twelve months.

Major Projects
A number of projects were initiated and undertaken during 2013/14. These include:
• Refurbishment of the Kempsey and Dungog stores.
• Replacement of pallet racking at Kempsey, Bowraville, Macksville, Dungog and Armidale.
• New automated bagging line at Lismore stockfeed mill.
• Introduction of new ‘Norco’ branded stockfeed packaging.
• Sale of the unprofitable Supervites business unit and closure of the plant.
• Expansion program resulting in three new Norco Rural sites during the year.

16
 Financial Management
In the 2013/14 year Norco achieved a net profit of $500,000 versus the prior year’s $350,000
and an EBITDA of $7.7 million versus the prior year’s $6.5 million. These results were both
favourable to the previous year which is particularly pleasing given that the 2012/13
year included four months of the Fonterra contract prior to the Front End business being
purchased by Norco in November 2012. Norco’s total debt, including finance leases,
increased by $6.9 million during the year from $27.4 million to $34.3 million. This was due
to the capital expenditure required for the Coles project plus a growth in working capital,
an inevitable consequence of a growing business.

Higher EBITDA in 2013/14

The EBITDA achieved in 2013/14 of $7.7 million is a significant improvement compared to

the prior year’s result of $6.5 million. The higher result was driven by strong performance
across the business units. The EBITDA for ice cream was 53.4 percent up on the prior year’s
result due to volume and margin growth. Norco Milk’s EBITDA was adverse to the prior
year by 16.3 percent, however after adjusting for the prior year’s profit from the Fonterra
contract it was favourable by 28 percent. The EBITDA for the Milk Supply business was
adverse to the prior year’s result by 30.4 percent and this was due to paying a higher milk
price to benefit our Members. The Rural Retail business unit improved its EBITDA by 51.5
percent versus the prior year due to higher volume and rebates and the Agribusiness
EBITDA was up 30.3%, driven by higher volume at both the Windera and Lismore mills and
higher sales from the Grain Trading section. Return on Capital Employed (ROCE) was 2.5
percent versus the prior year’s 2.0 percent driven by the improved profit position.

Debt Increase

Norco increased its debt with St George in the 2013/14 year by $5.0 million, largely driven
by the funds required to complete the capital projects for the Coles contract. Norco also
entered into a new finance lease for $1.9 million to acquire a second blow moulding
machine for the Labrador site, which was also required for the Coles contract. Total debt
at year end was $34.3 million versus the prior year’s $27.4 million. The total debt of $34.3
million includes $2.3 million of finance leases, $31.91 million of core debt with St George
and $0.1 million of Norco Capital Units.

Bank Covenants

Norco again met all bank covenants set by St George. Norco’s EBITDA Leverage for the full
year was a pleasing 3.98 versus the prior year’s result of 3.85.

Debtor and Creditor Days

Debtor days were slightly up versus the prior year, being 35.9 compared the prior year’s
35.8. This is a great result when taking into account the change in the business during the
year. Creditor days were 36.6 versus the prior year’s result of 36.0.

Working Capital

Working capital (made up of debtors, creditors and inventory) as at 30 June 2014 was $12.6
million versus the prior year’s $6.7 million, with the increase due to the growth across the
business units.

Dry Former Member Repayments

Using the funds derived from the Compulsory Share Acquisition Scheme, Norco repaid
$741,676 to “dry” former members this financial year. This takes active member capital to
88 percent of issued capital compared to 84 percent in 2012/13.

Camille Hogan
Chief Financial Officer 17
 BUSINESS
UNIT
REPORTS Norco people
Norco has achieved a range of significant results in 2013/14, none of which would be
possible without the commitment, dedication and talent of the people who work in
the business. A focus on having the right people in the right jobs means that from the
management team, right through to the factory floor and frontline team in the Norco Rural
stores we have a team who understands the goals of the business and are working toward
the improvement and ongoing success of Norco.

With the growth, challenges and changes to the business over the past year we have
seen opportunities for existing employees to step up, as well as the chance to recruit
new employees with different skills and experience. Norco has grown from a total of
644 employees in 2012/13 to 705 employees in 2013/14 and it is a careful balancing act
ensuring we have the correct mix of experience, skills and fresh ideas. Apart from the
new employees who were recruited to fill these extra positions, over 30 of our existing
employees have been promoted to higher levels of responsibility.

Motivation is one of the keys to keeping both our existing and new employees connected
to the business, even more so when pressure is applied to meet the challenge of growing
the business that has occurred in 2013/14. Fortunately Norco has a Board and Senior
Management Team who are passionate about the Co-operative and its ability to achieve
results beyond what many people would expect from a regional business. With such a
strong conviction that Norco WILL be successful – winning contracts with major retailers,
increasing sales in the distribution network, breaking into the Chinese export market,
achieving higher profit than last year when our competitors are closing businesses down
– our employees are swept along for the ride and are able to enjoy being a part of the
success that Norco is achieving.

The achievements of Norco are only made possible by the team we have, so thank you to
all of the employees that have been focusing on the business strategy and working toward
the success that has been achieved in 2013/14.

Health and Safety

The safety of Norco employees, contractors, visitors and communities is our number one
priority. Ways in which we protect people include:
• Implementing a framework that ensures the systematic management and continuous
improvement of health and safety at all of our workplaces, with the aim to ensure we are
compliant with legal and other requirements.

18
• Building a culture that promotes a pro-active approach to health and safety and mindful
of safety behaviours.
• Proactively identifying hazards, conducting risk assessments and implementing controls
to reduce hazards and minimise risk.

Each year Norco sets a number of strategic objectives in relation to health and safety.
2013/14 saw some excellent achievements in relation to health and safety, along with
some challenges.

A key objective is to reduce workers compensation claims across the Norco business and
is aimed at reducing the number of injuries occurring / reoccurring in the workplace. It
is disappointing to report that the target for 2013/14 was missed. However, it wasn’t all
bad news with other key workers compensation objectives being met. For instance, we
achieved a 20 percent reduction in lost time injury hours and a 37 percent reduction in
total workers compensation claims costs. These outcomes lead to the conclusion that the
type of injuries/illnesses incurred are of less severity and that Norco’s return to work and
rehabilitation programs are working effectively.

Manual handling incidents and injuries were the most frequent type of incidents reported,
constituting 28 percent of all reported incidents during 2013/14. To address the occurrence
/ reoccurrence of injuries Norco has implemented face-to-face and online manual handling
training, along with instigating a number of actions to reduce manual handling tasks.
Further training and actions will continue as we work to effectively minimise manual
handling at work.

Throughout the year Norco has also undertaken a Targeted Engagement Program
in conjunction with WorkCover NSW. This program was aimed at addressing high
consequence / low frequency risks within the business. As a result of this program over 130
actions have been implemented across six Norco sites, with the majority of these being
related to plant and equipment guarding and other engineering controls. The lessons
learnt from this program will now be disseminated to the remaining Norco workplaces.

Norco’s culture of continuous improvement in relation to health and safety will remain a
top priority for 2014/15, with the focus on ensuring a proactive approach to health and
safety, strong health and safety leadership, reducing injuries and illness and improving
compliance with regulatory and other requirements.

Yasmin Lawrence
Human Resources Manager

19
 directors’ report

The Directors present their report together with the financial reports for Norco Co-
operative Limited (‘the Co-operative’) for the year ended 30 June 2014 and the Auditors’
report thereon.

The Board of Directors currently comprises six supplier directors (non executive) and one
independent director (also non executive); however as at 30 June 2014 there were five
supplier directors and one independent director. As discussed in the Chairman’s Report, Mr
Peter W Neal vacated his office as a supplier director on 30 June 2014 as a consequence of
certain technical issues arising under the applicable legislation and the Rules. These issues
have since been addressed and rectified allowing Mr Neal to nominate for the casual vacancy
created by his vacation of office on 30 June 2014. Mr Neal was duly elected to fill the casual
vacancy and recently resumed his role on Norco’s Board of Directors – please refer to the
Chairman’s Report commencing on page 4 for full details.

Norco’s directors bring a range of skills and experience to the Board, including detailed
knowledge of the dairy and agricultural sectors, extensive experience in business planning
and strategy, strong leadership and interpersonal skills, and a commitment to achieving a
harmonious balance between Norco’s strategic business objectives and shareholders’ needs.

To supplement the existing skill base of the Board and to ensure all Directors are able to gain
an equal knowledge of various aspects of Norco’s business, the program of master classes
established last year continued on during the 2013/14 financial year. Master class topics are
predetermined by the Board in consultation with the Chief Executive Officer and presented
by senior managers of the business on a regular basis. During 2013/14, Directors received
presentations relating to Norco Foods distribution (logistics), facts on dairy export (including
tariffs) and the Norco Milk route trade.

During 2013/14 both the Board of Directors and management continued to utilise the
services of Mr George R Davey AM in a consultancy role to help establish and develop
further strong relationships with Asian customers and to ensure regulatory and customs
requirements are met to allow the Co-operative to successfully trade in these markets.

The Board of Directors continue to be committed to ongoing training and professional

development. During the year, directors have had the opportunity to attend a range of
industry conferences and to use their memberships in the Australian Institute of Company
Directors (AICD) to attend various AICD educational courses and functions.

The directors also recognise and acknowledge that they need to continually strive to ensure
that they perform to their maximum potential as members of the Board. The directors
assess each others’ performance by providing key data to the Chairman under an annual
performance appraisal system. The data is collated by the Chairman, who then provides
feedback to the directors individually. The performance of the Chairman is also assessed by
the directors under a similar appraisal system, which is facilitated by the Deputy Chairman.
The aim of these appraisal systems is to assist in improving individual director and overall
Board performance.

Gregory J McNamara
20
Chairman
DIRECTORS

Gregory J McNamara – Chairman

Greg McNamara has been a director of Norco Co-operative Limited for 18 years and is
from the Central Region. In addition to his role as Chairman of the Board of Directors,
he is Chairman of the Remuneration Advisory Committee and a member of both the
Communication Committee and Brand Management Advisory Committee.

Greg runs a 300 head dairy herd in partnership with his wife Sue and son Todd at
Goolmangar. He has extensive experience across the agricultural sector, including dairy, beef,
pigs, horticulture and animal genetics.

In his role as Chairman, during 2013/14 Greg has led the Board in achieving some significant
commercial outcomes for the Co-operative in line with the Board’s strategic plan. A very
strong relationship has been forged directly with Coles resulting in Norco being awarded
a five year contract to supply 65 million litres of milk annually from 1 July 2014. The
reacquisition of the Front End business has allowed the Norco brand to grow and a program
to export fresh milk to China commenced. Within the Board room environment, Greg
encourages open and frank discussions as well as holding the view that working collectively
together brings about a better outcome for all stakeholders. As it has been in previous years,
a continued focus for Greg has been to effectively communicate with the members.

Greg is a member of the Australian Institute of Company Directors (AICD) and has previously
completed their Company Directors’ Course. During 2013/14 Greg attended and presented
at the ABARES Outlook conference and attended industry events including the ADF National
Dairy Farmers Summit and the Australia and New Zealand Dairy Co-op Leaders Forum.
In addition, Greg participated in an Asialink agribusiness dinner as a panel member. Greg
recently achieved the status of Competent Communicator award through his participation
in the Toastmasters International communication program and joined the NSW Business
Chamber Board of Directors in February 2014.

Anthony (Tony) W Wilson – Deputy Chairman

Tony Wilson was elected as a director on 4 March 2009 and is from the Northern Region. He is
Chairman of the Milk Supply Advisory Committee and is also a member of the Remuneration
Advisory Committee, Brand Management Advisory Committee and Member Services
Committee.

Together with his wife Jillian and sons Nicholas and James, Tony lives and farms at The
Risk, 20 kms NW of Kyogle milking a herd of 260 cows that are Holstein based, with a
crossbreeding program in place. Tony has studied and gained a BA, Dip Ed at UNE, Armidale.
Tony also has an interest in agri-politics which has developed over many years and has been
focussed on the welfare of the dairy farming community.

Tony and his family operate the only robotic dairy in northern NSW which has created
considerable interest within the regional dairy industry and with the general public.

Tony completed the AICD Company Directors’ Course during November 2009 and in 2011
he completed the Company Directors’ Course Update. Tony attended the Australian Dairy
Conference and pre conference tour in February 2014 and in addition, attended an industry
workshop on China market access.

Anthony (Tony) W Wilson

Deputy Chairman 21
 Thomas (Tom) J Cooper
Director
Tom Cooper has been a director of Norco for 12 years and
is from the Northern Region. Tom is a member of the Milk
Supply Advisory Committee, Brand Management Advisory
Committee and Member Services Committee.
In partnership with his wife Vicki, Tom runs a 100-strong
dairy herd at Bonalbo, west of Casino. He is a graduate of
the University of Queensland’s Gatton Campus where he
obtained a Certificate in Animal Husbandry, and has also
worked in rural merchandising. Tom also has experience
as a licensed Auctioneer and Livestock Agent and as a
councillor on Kyogle Shire Council, a role which concluded
in September 2012.
Tom is a member of the AICD and has previously
completed the AICD Company Directors’ Course. On 27
March 2014 Tom was elected to the Board of the North
Coast Local Land Services.
22
David R Hodges
Independent Director
David Hodges was elected as an independent director on
12 November 2008 and is currently serving his second term
after being re-elected at the 2011 Annual General Meeting.
He is Chairman of both the Audit and Risk Management and
Communication Committees.
David holds Bachelor of Arts and Bachelor of Legal Studies
degrees and a Master of Laws degree. In addition, he also
holds a Diploma of Education, a Certificate in Community
Mediation and is a Justice of the Peace.
After a career spanning some 15 years in the public sector,
David spent over 17 years as a solicitor in private practice. For
the last six and a half years of his career as a solicitor David
was a partner in one of Australia’s leading national law firms.
Since leaving legal practice, in addition to serving as an
independent director of the Co-operative David has provided
business and commercial advice in a consultancy role as well
as providing mediation services to a wide range of clients.
David is a graduate and member of the AICD and regularly
attends AICD short courses and director briefings in order
to enhance and update his skills. During the 2013/14
year, David has attended several AICD events including
their Discussion Forum, Director Update and Corporate
leadership on WHS briefing. David also maintains a keen
interest regarding Norco’s entry into the Asian export
market and in this regard has attended an industry
workshop on China market access. Throughout his terms as
an Independent Director, David has utilised other resources
provided by the AICD such as their “Company Director”
magazine, as well as other professional and more general
publications, to keep abreast of emerging director issues
and to further his professional development as a director. To
this end David has devoted in excess of 100 hours towards
professional readings throughout the year.
 Michael C Jeffery
Director
Michael Jeffery was elected as a director on 14 November
2012 and is from the Southern Region. Michael is the
Chairman of the Brand Management Advisory Committee
and a member of both the Milk Supply Advisory
Committee and the Communication Committee.
Michael has been farming at Austral Eden near Kempsey
in a family partnership for 25 years and milks a herd of
300 cows. He has extensive business, marketing and dairy
industry experience, including in overseas countries and
holds a number of positions in dairy related businesses.
These include directorships of International Agricultural
Consulting Pty Ltd and International Agricultural Exports
Pty Ltd. In addition, Michael has been a state delegate
of both the NSW Dairy Farmers’ Association and Holstein
Australia for five years and had been on LiveCorp’s China
Live Export Industry Working Group Committee for
two years and as part of the NorcoNet communication
network, has been Chairman of the Nambucca / Kempsey
group for three years. Michael also holds an Advanced
Diploma in Agriculture.
Michael is a member of the Australian Institute of
Company Directors and during October 2013 Michael
completed the AICD Company Directors’ Course. During
2013/14 Michael attended the Australian Dairy Conference
and an industry workshop on China market access as well
as the AICD Finance for Directors course.
Leigh Shearman
Director
Leigh was elected as a director on 14 November 2012 and
is from the Central Region. Leigh is Chairperson of the
Member Services Committee and a member of the Audit
and Risk Management Committee.
With her partner Donald Shedden, Leigh owns and
operates a dairy farm at Goolmangar just outside Lismore
in Northern New South Wales milking 180 cows which are
predominantly Holsteins. Leigh also has experience across
a broad agricultural base gained over many years, including
beef, horticulture and intensive piggery farming. She has
also owned and operated a retail franchise and has worked
in the banking industry for 10 years. Leigh has a Diploma in
Rural Business Management and a Diploma of Agriculture
and is the chairperson of the Far North Coast Dairy Industry
Group Inc (DIG) and is secretary of Subtropical FNC.
Leigh is a passionate advocate for farmers at a grass roots
level to ensure the future of the dairy industry is protected
in the region, having represented farmers in securing a
fairer Lismore Local Environment Plan and negotiating
beneficial changes to the Water Sharing Plan for her local
catchment area. Leigh also represents both Norco and DIG
on the Lismore City Council Draft Biodiversity Management
Strategy Stakeholder Reference Group.
Leigh is a member of the Australian Institute of Company
Directors and during August 2014 she completed the AICD
Company Directors’ Course. During the year Leigh also
attended the ADF National Dairy Farmers Summit.
Note: In accordance with a Board resolution which is presently
effective until December 2014, the full Board currently constitutes
the Milk Supply Advisory Committee. This means that in addition
to Messrs AW Wilson, TJ Cooper and MC Jeffery being noted as
Committee members above, Messrs GJ McNamara, DR Hodges and
Ms L Shearman also sit on the Committee.
23
 DIRECTOR ELECTIONS – 2013/14
The retiring Directors Messrs AW Wilson (Northern Region)
and PW Neal (Southern Region) being eligible, offered
themselves for re-election. Member nominations were also
received from Mrs N Nicholls (Northern Region) and Mr H
Hoffman (Northern Region) and accordingly a postal ballot
was held for the Northern Region resulting in Mr Wilson
being re-elected for a three year term effective from the
2013 Annual General Meeting on 13 November 2013. As
there were no Member nominations received from the
Southern Region, Mr Neal was re-elected unopposed for
a three year term effective from the 2013 Annual General
Meeting on 13 November 2013.
The positions of Chairman and Deputy Chairman are voted
on annually by the directors following the Annual General
Meeting.
Directors’ Meetings
The number of Board meetings (including meetings of the
Audit and Risk Management Committee and Milk Supply
Advisory Committee) and number of meetings attended
by each of the directors of the Co-operative during the
financial year are:
Directors’ Audit and Risk Milk Supply
Meetings Management Advisory
Committee Committee
Meetings Meetings
A B A B A B
GJ McNamara
12 12 - - 10 9
AW Wilson 12 12 4 4 10 10
TJ Cooper 12 12 - - 10 9
DR Hodges 12 12 10 10 10 10
MC Jeffery 12 12 - - 10 10
L Shearman 12 12 10 10 10 10
PW Neal 12 12 6 6 10 10
A Reflects the number of meetings held during the time
the director held office during the year
B Number of meetings attended
During the course of the 2013/14 financial year there were
also nine directors’ meetings held by teleconference and
three Milk Supply Advisory Committee meetings held by
teleconference. Teleconferences are organised to discuss
and resolve specific issues that cannot be held over until the
next scheduled monthly meeting and generally the duration
of such teleconferences is one hour or less. Teleconferences
are a cost effective and practical way for directors to discuss
24
specific issues in a timely manner given that their residences
are spread over a large geographic area.
At the Board meeting held on 18 and 19 December 2013
it was resolved that the full Board will continue to sit on
the Milk Supply Advisory Committee until at least the
December 2014 Board meeting, at which time the annual
review of Committee memberships will take place.
CORPORATE INFORMATION
Corporate structure
Norco Co-operative Limited is a co-operative limited by
shares which is incorporated and domiciled in Australia.
Nature of operations and principal activities
The principal activities of the Co-operative during the
financial year were the processing, manufacture and sale of
dairy products, the manufacture and sale of stockfeeds and
rural retailing.
Employees
The Co-operative employed 465 full-time, 66 part-time
permanent and 174 casual employees at 30 June 2013
(2013: 442 full-time, 64 part-time permanent and 138 casual
employees).
Results of operations
The net amount of the operating profit for the financial year
of the Co-operative after providing for income tax was $0.3
million (2013: $1.1 million loss).
Derivatives and other financial instruments
The Co-operative’s activities expose it to changes in interest
rates, foreign exchange rates and commodity prices. It is
also exposed to credit, liquidity and cash flow risks from
its operations. During the year, the Board has maintained
policies and procedures in each of these areas to manage
these exposures. Management reports to the Board on a
monthly basis on the monitoring of and compliance with
the policies in place.
Dividends
No dividends were paid during the 2013/14 financial year
as a dividend rate of 0.0% (zero percent) on issued capital
was declared and approved by Members at the 2013 Annual
General Meeting, which was held on 13 November 2013.
Operations review
The directors’ have reviewed the Co-operative’s operations
during the financial year and the results of those operations,
which are discussed in the Chairman’s Report and Chief
Executive Officer’s Report for the financial year ended 30
June 2014 (see pages 4 and 7).
Events subsequent to balance date
During the interval between the end of the financial year
and the date of this report, there has not arisen any item,
transaction or event of a material and unusual nature which,
in the opinion of the directors, is likely to significantly affect
the operations of the Co-operative, the results of those
operations or the state of affairs of the Co-operative in
subsequent financial years.
Future developments
in their capacity as dairy farmers in the supply of milk to the
Co-operative in the ordinary course of business.
Directors’ declarations of interest
Mr GJ McNamara was elected to the Board of the NSW
Business Chamber Limited effective 20 February 2014. Mr
McNamara has declared his interest in accordance with
Section 208 of the Co-operatives National Law (NSW) and,
in addition, has excluded himself from any discussions or
decisions relating to this matter.

In the opinion of the directors disclosure of information
regarding the likely developments in the operations of the
Norco in future financial years and the expected results of
those operations is likely to result in unreasonable prejudice
to the Co-operative. Accordingly, this information has not
been disclosed in this report.
On 27 March 2014 Mr TJ Cooper advised that he has been
elected to the Board of the North Coast Local Land Services.
Mr Cooper has declared his interest in accordance with
Section 208 of the Co-operatives National Law (NSW) and,
in addition, has excluded himself from any discussions or
decisions relating to this matter.

Indemnification and insurance of Directors and Officers On 31 October 2013 Mr MC Jeffery advised that he has
resigned as a Director of Ausgene Pty Ltd. In addition Mr
The Co-operative has entered into agreements to indemnify
Jeffery confirmed that he is still a Director of International
all directors named at the beginning of this report, former
Agricultural Consulting Pty Ltd however this company has
directors and current and former officers of the Co-
terminated its agreement to provide consultancy services
operative against all liabilities to persons (other than to the
to Genetics Australia. Mr Jeffery has declared his interest in
Co-operative or to a related body corporate) which arise out
accordance with Section 208 of the Co-operatives National
of the performance of their normal duties as a director or
Law (NSW) and, in addition, has excluded himself from any
officer, unless the liability relates to conduct involving a lack
discussions or decisions relating to these matters for the
of good faith.
relevant period of time.
The Co-operative has agreed to indemnify the directors and
Rounding off of amounts
officers against all costs and expenses incurred in defending
an action that falls within the scope of the indemnity and The amounts in this report and the accompanying
any resulting payments. The relevant insurances cover legal financial statements have been rounded to the nearest
liabilities and associated costs arising from the performance one thousand dollars in accordance with the Co-operatives
of their duties as directors and officers and compensation National Law (NSW).
for loss or injury sustained in the course of such duties.
Auditor’s independence declaration to the directors
Options over unissued shares
The directors received a declaration of independence from
Options over unissued shares have not been granted to any the Co-operative’s auditor, Ernst & Young. A copy of that
person or director since the end of the previous financial declaration is included after this Directors’ Report.
year to date of this report.
Appreciation
Directors’ benefits
The efforts and contribution of our management and staff
Since the end of the previous financial year, except as during the year were greatly appreciated by directors.
declared below, no director of the Co-operative has received
Signed in accordance with a resolution of the directors.
or become entitled to receive any benefit (other than a
benefit included in the aggregate amount of emoluments
received or due and receivable by directors shown in
the financial statements or the fixed salary of a full time
employee of the Co-operative or of a related corporation)
by reason of a contract made by the Co-operative or a GJ McNamara AW Wilson
related corporation with the director or with a firm of which Chairman Deputy Chairman
the director is a member, or with a company in which the
Lismore, 24 September 2014
director has a substantial financial interest, except for that
benefit which may be deemed to accrue to those directors
25
26
corporate governance
statement
This statement outlines the main corporate governance
practices that were in place throughout the 2013/14 financial
year, unless otherwise stated. These practices are dealt with
under the headings: Board of Directors and its Committees;
Internal Control Framework; Ethical Standards; Business Risks
and Emergency Planning; and The Role of Members.
Board of Directors and its Committees
The Board of Directors is responsible for the overall corporate
governance of the Co-operative including strategic
direction and enhancing organisational performance, the
sound management of its business and assets, confirming
financial objectives, understanding and managing risks to
maximise opportunities, establishing goals for management
and monitoring performance against those goals. The
Board of Directors is also responsible for reporting to
members and being accountable to, and focussed on the
needs of members and meeting statutory and regulatory
requirements. To give further effect, the Audit and Risk
Management Committee assists in the execution of the
Board’s responsibilities. The Milk Supply Advisory Committee,
Communication Committee, Member Services Committee
and Brand Management Advisory Committee also meet
regularly and play an important role in assisting the Board of
Directors in managing the important relationship between
the Co-operative and the members. The Board Committees
are discussed further below.
To better understand the operations of the Co-operative’s
businesses the Board receives regular reports, presentations
and briefing papers on key aspects and makes site visits to
the Co-operative’s operations.
Composition of the Board
Under the Rules of the Co-operative the Board of Directors
is comprised of a minimum of six non-executive (supplier)
directors who represent the members from the Northern,
Central and Southern regions. Each region is represented
by two supplier directors, with directors serving a three year
term. At each Annual General Meeting two directors retire
in accordance with the Rules of the Co-operative. The Rules
also allow for two independent directors to be elected to the
Board. Currently the position for one independent director
remains vacant.
An active member of the Co-operative may seek election
as a supplier director in accordance with the Rules of the
Co-operative and, if elected, serve a term of three years
after which time they retire. Independent directors, when
nominated and elected, are elected for a term of three years
after which time they retire. The directors regularly consider
whether or not the skills and characteristics which might
be contributed by independent directors should be added
to the Board to maximise its effectiveness. Independent
directors are to be nominated by the Board and elected by
members. Currently there is one independent director on the
Board of Directors, being Mr David Hodges, whose three year
term concludes at the 2014 Annual General Meeting.
Regarding potential conflicts of interest, it is the practice of
the Norco Board to open every meeting by giving directors
the opportunity to declare any actual or potential conflicts.
If a conflict of interest should arise, the director concerned
takes no part in discussions at the Board meeting on the
issue, nor exercises any influence over other Board members.
The total remuneration package for directors is voted
on at each Annual General Meeting. The amount paid
may vary between directors depending on their level of
responsibilities. Remuneration of directors is set out in the
notes to the financial statements.
Board Corporate Governance Policy and Emerging
Corporate Governance Issues
The purpose of the Corporate Governance Policy Statement
is to provide guidance to directors and management on how
the Co-operative is to be governed in practice. The document
was developed having regard to the Co-operatives National
Law (NSW) and Norco’s Rules. All current directors have
signed Deed Polls and Statutory Declarations to ensure their
commitment to the Corporate Governance Policy Statement
and the duties and responsibilities specifically addressed in
the Deed Polls.
A review of the Corporate Governance Policy Statement is
undertaken annually by the directors to ensure that issues
of governance are dealt with in accordance with the policy.
At the same time, the policy is reviewed to ensure it is still
relevant and up to date.
It is pleasing to report that all current directors have attended
and completed the AICD Company Directors’ Course.
Introduction of National Co-operatives Law in NSW
On 3 March 2014 the Co-operatives National Law (CNL) came
into operation, repealing and replacing the Co-operatives Act
1992. The Co-operatives Act 1992 is the legislation currently
referenced in the Norco Rules, and all references in the Rules
to section numbers of “the Act” are to section numbers in the
Co-operatives Act 1992.
The legislation and regulations relating to implementation
of the CNL have the effect that Norco can continue to
operate under its existing Rules. In particular, the CNL
deems references in the Rules to sections of the repealed
Co-operatives Act 1992 and associated regulations to be
references to the equivalent sections in the CNL and its
associated regulations.
Nevertheless, the Board has taken steps to update the
27
 Rules as a consequence of the introduction of the CNL to
ensure the Rules correctly reflect the terminology and law as
specified in the CNL and to assist members by referring them
and other readers to the correct sections of the CNL and
associated regulations.
The members will consider and vote on the proposed Rule
changes relating to the introduction of the CNL at the 2014
Annual General Meeting to be held on 12 November 2014.
Review of Regional Boundaries
At the January 2014 Board meeting, Directors reviewed the
current membership numbers in each of the three Regions
(Northern, Central and Southern). The Board undertakes a
regular review of the membership numbers to comply with
current Rule 46.12.
In undertaking their review, the Board also took into
account the projected regional membership numbers
that would likely be achieved based on the new Member
milk supply that come into the Co-operative up to 1 July
2014 as well as other associated factors such as anticipated
farm closures. The Board came to the view that there was
an inequality in the number of Members in each of the
Northern and Central regions.
The Board proposed to members that there would be a more
balanced distribution of Members across the three Regions
if the Members whose dairy farm interests that are located
in the Kyogle Local Government Area were transferred to
the Central Region. This meant that under the proposal, the
Central Region would constitute the NSW Local Government
Areas of Tweed, Kyogle, Byron, Ballina, Lismore, Richmond
Valley and Clarence Valley. The Board also proposed that the
Northern Region would consist only of Members whose dairy
farm interests are located in the State of Queensland.
A Special General Meeting was held on 25 June 2014 to put
the proposed Rule changes to members who unanimously
approved the changes. The affected members were
consulted during the process and notified following the vote
of members.
Board Committees
The directors seek to achieve best practice in corporate
governance and accountability through the following Board
Committees which assist the Board in the execution of its
responsibilities. These committees are subject to Charters
which have been approved by the Board and which define
their respective roles and responsibilities.
Audit and Risk Management Committee
The objective of the Audit and Risk Management Committee
is to assist the Board of Directors in fulfilling its statutory
and fiduciary responsibilities relating to accounting and
28
reporting practices of the Co-operative and subsidiaries. The
Committee advises on the establishment and maintenance
of an overall framework of internal control and appropriate
ethical standards for the management of the Co-operative.
The Committee gives the Board additional assurance
regarding the quality and reliability of financial information
prepared for use by the Board in determining policies
for inclusion in financial statements. The Audit and Risk
Management Committee also embraces, as part of its Charter,
the Co-operative’s Risk Management Program.
The Audit and Risk Management Committee ensures:
• compliance with statutory responsibilities relating to
financial disclosure;
• focus on significant changes in accounting policies,
standards and practices or other reporting requirements
likely to affect developments in financial reporting;
• regular reviews of operations and policies are conducted;
• review of the audit and annual financial statements and
interim financial information and the adequacy of existing
external audit arrangements with particular emphasis on
the scope and quality of the audit; and
• risk management reporting systems are in place to
effectively identify and manage strategic, operational and
financial risks. To give further effect to identifying and
quantifying risks faced by the Co-operative, a risk register
has been developed which is managed under the scope
of the Audit and Risk Management Committee. The risk
register details the probability and impact of various
business risks and creates a risk score together with a
mitigation plan.
The Audit and Risk Management Committee reviews the
performance of the external auditors on an annual basis and
meets them during the year as follows:
• to review the results and findings of the audit, the adequacy
of financial and operating controls, and to monitor the
implementation of any recommendations made; and
• to review the draft financial statements and the audit report
and to make the necessary recommendation to the Board
for the approval of the financial statements.
The Committee is comprised of three directors and meets
at least six times per year. The Chairman of the Co-operative
shall not be a member of the Committee.
Milk Supply Advisory Committee
The objective of the Milk Supply Advisory Committee is to
provide properly considered recommendations to the Board
of Directors in relation to the adoption of policies pertaining
to certain matters regarding the acquisition of milk by the
Milk Supply business unit and the sale of that milk to its
external and internal customers.
In giving effect to this objective, the Committee will make
recommendations to the Board of Directors in relation to
policies regarding:
• the sourcing of milk by the Milk Supply business unit, with
specific reference to -
- the terms under which such milk is to be acquired
(including but not limited to price): and
- the location(s) from which such milk is to be acquired;
and
• the sale of milk by the Milk Supply business unit, with
specific reference to the terms under which that milk is sold
(including but not limited to price).
The composition of the Milk Supply Advisory Committee is
determined by the Board from time to time. The Committee
meets at least every quarter.
Communication Committee
The objective of the Communication Committee is to make
properly considered recommendations to the Board of
Directors in relation to the adoption of policies pertaining to
corporate communication.
The Committee recognises that effective communication
relies on “listening as well as speaking”. Consequently, in
seeking to achieve its objective the Committee will make
recommendations to the Board of Directors in relation to
policies regarding:
• the Co-operative’s overall strategy in relation to corporate
communications;
• the Co-operative’s major corporate communications and
announcements, ensuring all stakeholders are considered
and that such communications and announcements are
through the appropriate nominated spokesperson;
• communication plans for crisis / disaster situations;
• joint communications which may affect another
organisations or individuals, or by which Norco may be
affected; and
• the terms under which an appointment or engagement (if
any) of a public relations firm is made to assist Norco with
corporate communications.
The Committee is comprised of three directors and meets at
least every quarter.
Member Services Committee
The objective of the Member Services Committee is to make
properly considered recommendations to the Board of
Directors in relation to the adoption of policies pertaining to
non milk supply, member issues.
In giving effect to this objective, the Committee will make
recommendations to the Board of Directors in relation to
policies regarding:
• developing and encouraging the sustainability of the Norco
farm base through initiatives such as improving farming
techniques, study tours and improving business skills;
• assisting with the ongoing wellbeing of the Norco farm base
by assisting with succession planning, mental health issues
and social networking / support;
• providing and disseminating information from external
sources relating to issues such as the education and training
of potential directors, government assistance, climate
changes and the emissions trading scheme; and
• providing support to the Norco farm base through the
management of issues such as exceptional circumstances,
disaster recovery planning, critical farm issues (such as tick
infestations) and other such matters that the Committee
determines to be in the interests of members.
The Committee is comprised of four directors and meets on
an as-needs basis.
Brand Management Advisory Committee
The objective of the Brand Management Advisory Committee
is to provide properly considered recommendations to the
Board of Directors in relation to matters that affect Norco’s
brands and to the adoption of policies pertaining to specific
issues such as animal welfare issues for both Norco and
Norco’s milk suppliers / members.
In giving effect to this objective, the Committee will make
recommendations to the Board of Directors in relation to
policies regarding:
• Animal welfare – including all aspects of animal welfare
pertaining to the Norco farm base, understanding the
requirements of retail customers, ensuring Norco has robust
policies and procedures and working with, and making
representations to, a range of stakeholders that have an
interest in animal welfare; and
• Norco brands – including protecting and adding value
and ensuring that the reputation of the Norco brands are
maintained and improved upon as well as the promotion of
the Norco Brands.
The Committee is comprised of four directors, the General
Manager - Milk Supply and Milk Supply Manager and meets
on an as-needs basis.
29
 Remuneration Advisory Committee
The objective of the Remuneration Advisory Committee is to
make properly considered recommendations to the Board
of Directors in relation to the remuneration of the Senior
Management Team, Chief Executive Officer and Board of
Directors and in relation to incentive programs within the
Norco business.
In giving effect to this objective, the Committee will:
• monitor and review all Senior Management Team
remuneration;
• evaluate, monitor and review any Short Term Incentive
(STI) and Long Term Incentive (LTI) programs that may be in
operation in the Norco business;
•evaluate the performance of the Chief Executive Officer and
make recommendations in relation to the remuneration of
the Chief Executive Officer; and
• make recommendations to the Board in relation to director
remuneration.
The Committee is comprised of two directors and the Chief
Executive Officer and meets at least annually.
INTERNAL CONTROL FRAMEWORK
The Board acknowledges that it is responsible for the overall
internal control framework, but recognises that no cost-
effective internal control system will preclude all errors and
irregularities. To assist in discharging this responsibility, the
Board has instigated an internal control framework which can
be categorised under the following headings:
• Corporate Strategy – there are clearly defined short,
medium and long term strategic objectives set and
reviewed by the Board of Directors on at least an annual
basis and an operational strategic plan developed by
management to meet these objectives. Strategic issues are
considered at each meeting of the Board of Directors.
• Financial reporting - there is a comprehensive budgeting
system with an annual budget approved by the Board.
Monthly actual results are reported against budget and
revised rolling forecasts for the year are prepared monthly.
• Quality and integrity of personnel - the Co-operative’s
policies are detailed in a policy and procedures manual. New
policies and procedures are developed, or amendments
made to existing policies and procedures, as the need arises.
• Investment appraisal - the Co-operative has clearly defined
guidelines for capital expenditure. These include annual
budgets, detailed appraisal and review procedures and
30
due diligence requirements where businesses are being
acquired and divested.
• Executive authority limits – the Co-operative has clearly
defined financial authority limits for management positions
in relation to capital expenditure, foreign exchange, forward
purchase agreements, forward grain sale agreements and
general expenses.
Quality Accreditation
The Norco Foods division strives to ensure that its products
are of the highest standard. The Lismore Ice Cream
Business Unit has accreditation in HACCP with the NSW
Food Authority, SQF 2000 Level 3, Coles Quality Assurance,
Woolworths Quality Assurance Standard, U.S. Food and Drug
Administration registered and has an Approved Arrangement
with AQIS for export. The Labrador milk factory has HACCP
accreditation with Safe Foods QLD, SQF 2000 Level 3, Coles
Quality Assurance, Woolworths Quality Assurance Standard,
NCS HACCP accreditation and has an Approved Arrangement
with AQIS for export. The Raleigh milk factory has NSW Food
Authority HACCP accreditation, SQF 2000 Level 3, NASAA
and ACO accreditation (both for organic milk) and has an
Approved Arrangement with AQIS for export. Raleigh is also
Kosher certified for the production of all A2 products.
In the Norco Agribusiness unit the Goldmix Stockfeeds
manufacturing mill at Lismore has FeedSafe accreditation
under the Stockfeed Manufacturers’ Association of Australia
and HACCP accreditation. The Goldmix Stockfeeds
manufacturing mill at Windera in Queensland has FeedSafe
accreditation under the Stockfeed Manufacturers’ Association
of Australia and has both ISO 9001 and HACCP accreditation.
Norco is a member of the Stockfeed Manufacturers’
Association of Australia.
Norco Rural Retail staff are AgSafe accredited for the
handling, transport and recommendation of agricultural
chemical products. The Rural Retail premises are AgSafe
accredited for the storage and handling of agricultural
chemical products.
Safety
Norco is committed to the safety and wellbeing of staff
across its entire operations. Norco strives to comply with
the provisions of a safe working environment and continues
to make safety an integral part of our organisation, which
is essential if we are to continue building a successful
business into the future. On a monthly basis, the Board of
Directors receives management reports detailing the safety
performance for the business and monitors this performance
closely. The Board also receives a copy of all minutes of the
various site WHS committee meetings that are held.
Environment
Norco aims to ensure that the highest standard of
environmental care is achieved. The Co-operative recognises
that it has a responsibility to ensure that its operations are
sensitive to the environment and comply with the letter and
spirit of all applicable environmental legislation.
ETHICAL STANDARDS
All directors, managers and employees are expected to act
with the utmost integrity and objectivity, striving at all times
to enhance the reputation and performance of Norco. Every
employee has a nominated manager or supervisor to whom
they may refer any issue arising from their employment.
BUSINESS RISKS AND EMERGENCY PLANNING
Management has identified, and continues to identify,
business risks and potential emergencies with the aim of
minimising any consequential adverse effects on the Co-
operative.
Business risks arise from such matters as:
• action by competitors and industry rationalisation;
• government policy changes;
• physical loss of assets through fire or another natural
disaster and the resultant business interruption that may
occur;
• the impact of exchange rate movements on the price of raw
materials and on sales
• variations in interest rates;
• difficulties in sourcing raw materials; and
• the purchase, development and use of information systems,
and other emergencies that may occur.
THE ROLE OF MEMBERS
The Board of Directors aims to ensure that the members
are informed of all major developments affecting the Co
operative’s state of affairs. Information is communicated to
members as follows:
• The Annual Report is distributed to all members. The Annual
Report includes relevant information about the operations
of the Co-operative for the financial year just ended,
changes in the state of affairs of the Co-operative and details
of future developments, in addition to the other disclosures
required by the Co operatives Legislation;
• Meetings are held at least twice yearly with supplier
members at various locations to personally inform them
about the affairs of the Co-operative;
• In addition to the meetings with supplier members, a more
informal communication network called ‘NorcoNet’ is in
place throughout the Norco supply area. The purpose of
‘NorcoNet’ is to bring small groups of members together on
a regular basis to form a local network to discuss general
dairy industry issues and issues that relate to the Co-
operative;
• The preparation and distribution of a monthly Norco Bulletin
and ad hoc newsletters;
• Some proposed major changes in the Co-operative
which relate to the core businesses are required by the Co
operatives National Law (NSW) to be submitted to a vote of
members; and
• Communication is a two-way process, and the Board
encourages individual members or groups of members
to apply to attend Board Committee and / or meetings by
appointment.
The Board encourages full participation of members at
the Annual General Meeting to ensure a high level of
accountability and identification with the Co-operative’s
strategies and goals. Due to the geographical spread of
members, the holding of the Annual General Meeting is
rotated between the three member regions. Important
issues are presented to the members as single resolutions
for their consideration.
The members are responsible for the election of directors.
31
 FINANCIAL
STATEMENTS Statement of
comprehensive income
For the year ended 30 June 2014

2014 2013
Before Significant Total Before Significant Total
Significant Items (1) Significant Items (1)
Items Items
Notes $000 $000 $000 $000 $000 $000
Revenue 4.1 430,729 - 430,729 369,891 - 369,891
Milk payments to suppliers (87,962) - (87,962) (80,036) - (80,036)
Cost of sales (242,231) - (242,231) (200,847) - (200,847)
Employee expenses 4.2 (49,906) - (49,906) (44,146) - (44,146)
Depreciation expense 4.3 (5,385) - (5,385) (4,831) - (4,831)
Borrowing costs expense (2,448) - (2,448) (1,879) - (1,879)
Occupancy expenses (4,442) - (4,442) (4,007) - (4,007)
Administration and other costs 4.4 (37,940) - (37,940) (34,345) - (34,345)
Profit on disposal of non-current
assets 85 - 85 550 - 550
Restructure costs - (138) (138) - (770) (770)
Profit/(loss) before tax from
ordinary activities before
income tax expense and
member distributions 500 (138) 362 350 (770) (420)

Member distributions 6 - (46) (46) - (692) (692)

Profit/(loss) before income tax 500 (184) 316 350 (1,462) (1,112)
Income tax expense 5 - - - - - -
Net profit/(loss) attributable to
members 500 (184) 316 350 (1,462) (1,112)
Other comprehensive income,
net of tax - - - - - -
Total comprehensive
income/(loss) for the period
attributable to members 500 (184) 316 350 (1,462) (1,112)

(1) Significant items are items of income and expense, presented separately due to their nature and size.

The above Statement of comprehensive income should be read in conjunction with the accompanying notes.

32
Statement of
financial position
As at 30 June 2014

2014 2013
Notes $000 $000
Current assets
Cash assets and cash equivalents 17.3 1,802 4,488
Trade and other receivables 7 47,489 40,877
Inventories 8 29,647 25,415
Other assets 488 434
Total current assets 79,426 71,214

Non-current assets
Investments 9 3 3
Property, plant and equipment 10 53,735 49,080
Intangible assets and goodwill 11 37,101 37,081
Total non-current assets 90,839 86,164
Total assets 170,265 157,378

Liabilities
Current liabilities
Trade and other payables 12 56,665 52,317
Employee benefit liabilities 13 8,235 7,642
Interest-bearing loans and borrowings 14 589 245
Total current liabilities 65,489 60,204

Non-current liabilities
Trade and other payables 12 398 397
Employee benefit liabilities 13 1,309 1,151
Interest-bearing liabilities 14 33,669 27,201
Total non-current liabilities 35,376 28,749
Total liabilities 100,865 88,953

Net assets attributable to members 69,400 68,425

Members’ interest 15 8,170 7,511

Net assets 61,230 60,914

Equity
Retained earnings 22,143 21,827
Reserves 16 39,087 39,087
Total equity 61,230 60,914

The above Statement of financial position should be read in conjunction with the accompanying notes.

33
 Statement of
changes in equity
For the year ended 30 June 2014

Asset
Retained revaluation
earnings reserve Total equity
$000 $000 $000

As at 1 July 2013 21,827 39,087 60,914

Profit for the year 316 - 316

Other comprehensive income - - -
Total comprehensive income 316 - 316

At 30 June 2014 22,143 39,087 61,230

Asset
Retained revaluation
earnings reserve Total equity
$000 $000 $000
As at 1 July 2012 22,939 39,087 62,026

Loss for the year (1,112) - (1,112)

Other comprehensive income - - -
Total comprehensive loss (1,112) - (1,112)

At 30 June 2013 21,827 39,087 60,914

The above Statement of changes in equity should be read in conjunction with the accompanying notes.

34
Statement of
cash flows
For the year ended 30 June 2014

2014 2013
Notes $000 $000

Operating activities
Receipts from customers 424,381 362,677
Payments to suppliers and employees (333,859) (277,091)
Interest received 330 314
Interest paid (2,448) (1,879)
Milk supplier payments (87,962) (81,230)
Net cash flows from operating activities 17.1 442 2,791

Investing activities
Proceeds from sale of property, plant and equipment 101 1,720
Purchase of property, plant and equipment (8,196) (8,682)
Purchase of business, net of cash acquired - (4,193)
Net cash flows used in investing activities (8,095) (11,155)

Financing activities
Suppliers’ share contribution 659 818
Repayment of member deposits (598) (757)
Distributions paid to members (46) (627)
Payment of finance lease liabilities (190) (465)
Proceeds from borrowings 5,142 8,459
Net cash flows from financing activities 4,967 7,428

Net (decrease) in cash and cash equivalents (2,686) (936)

Cash and cash equivalents at opening balance date 4,488 5,424
Cash and cash equivalents at 30 June 17.3 1,802 4,488

The above Statement of cash flows should be read in conjunction with the accompanying notes.

35
 Notes to the
financial statements
For the year ended 30 June 2014
1. Corporate information
The financial statements of Norco Co-operative Limited and
its controlled entities (the Co-operative) for the year ended
30 June 2014 were authorised for issue in accordance with a
resolution of the directors on 24 September 2014.
Norco Co-operative Limited is a Co-operative under the Co-
operatives National Law (NSW), incorporated and domiciled
in Lismore, Australia. The Co-operative operates out of its
registered place of business at “Windmill Grove” 107 Wilson
Street, South Lismore, New South Wales. The principal
operations of the Co-operative are the processing, manufacture
and sale of dairy products, the manufacture of stockfeed and
rural retailing.
2. Summary of significant accounting policies
(a) Basis of preparation
The financial report has been prepared on the basis of historical
cost (except for certain land and building assets where in 2004
fair value was deemed to be cost) and in accordance with the
requirements of the Corporations Act 2001. Cost is based on the
fair values of the consideration given in exchange for assets.
In the application of Australian equivalents to International
Financial Reporting Standards (‘AIFRS’) management is required
to make judgements, estimates and assumptions about
carrying values of assets and liabilities that are not readily
apparent from other sources. The estimates and associated
assumptions are based on historical experience and various
other factors that are believed to be reasonable under the
circumstance, the results of which form the basis of making the
judgements. Actual results may differ from these estimates.
The estimates and underlying assumptions are reviewed
on an ongoing basis. Revisions to accounting estimates are
recognised in the period in which the estimate is revised if the
revision affects only that period, or in the period of the revision
and future periods if the revision affects both current and
future periods.
Judgements made by management in the application of AIFRS
that have significant effects on the financial statements and
estimates with a significant risk of material adjustments in the
next year are disclosed, where applicable, in the relevant notes
to the financial statements. Accounting policies are selected
and applied in a manner which ensures that the resulting
financial information satisfies the concepts of relevance
and reliability, thereby ensuring that the substance of the
underlying transactions or other events is reported.
The accounting policies set out below have been applied in
preparing the financial statements for the year ended 30 June
2014 and the comparative information presented in these
financial statements for the year ended 30 June 2013.
The financial report is presented in Australian dollars and all
values are rounded to the nearest thousand dollars ($’000)
unless otherwise stated under the option available to the
Co-operative under class order 98/100. The Co-operative is an
entity to which the class order applies.
36
(b) Changes in accounting policy, disclosures, standards
and interpretations
i) Changes in accounting policies, new and amended
standards and interpretations
The Co-operative has adopted the following new and amended
Australian Accounting Standards and AASB Interpretations as
of 1 July 2013:
• AASB 10 Consolidated Financial Statements
• AASB 11 Joint Arrangements
• AASB 12 Disclosure of Interests in Other Entities
• AASB 13 Fair Value Measurement
• AASB 119 Employee Benefits (Revised 2011)
• AASB 127 Separate Financial Statements
• AASB 128 Investments in Associates and Joint Ventures
The adoption of these standards or interpretations has not had
a significant effect on the financial statements.
ii) Accounting Standards and Interpretations issued but not
yet effective
Certain Australian Accounting Standards and Interpretations
have recently been issued or amended but are not yet effective
and have not been adopted by the Co-operative for the annual
reporting period ended 30 June 2014. The directors have not
early adopted any of these new or amended standards or
interpretations. The directors have not yet fully assessed the
impact of these new or amended standards (to the extent
relevant to the Co-operative) and interpretations.
(c) Statement of compliance
The financial report complies with Australian Accounting
Standards, which include International Financial Reporting
Standards (IFRS) as issued by the International Accounting
Standards Board.
The accounting policies are consistent with those of the
previous financial year. Norco Co-operative Limited has not
made a formal written election to early adopt any new and
amended Australian Accounting Standards as of 30 June
2014. For Australian Accounting Standards and Interpretations
that have recently been issued or amended but are not yet
effective and have not been adopted by the Group for the
annual reporting period ended, the Group has assessed there
will be no material impact on the presentation of the financial
statements.
(d) Basis of consolidation
The financial statements comprise the financial statements
of the Co-operative and its subsidiaries as at 30 June 2014.
Control is achieved when the Co-operative is exposed, or
has rights, to variable returns from its involvement with the
investee and has the ability to affect those returns through its
power over the investee. Specifically, the Co-operative controls
an investee if and only if the Co-operative has:
• Power over the investee (i.e. existing rights that give it the
current ability to direct the relevant activities of the investee);
• Exposure, or rights, to variable returns from its involvement
with the investee; and
• The ability to use its power over the investee to affect its
returns.
When the Co-operative has less than a majority of the voting
or similar rights of an investee, the Co-operative considers all
relevant facts and circumstances in assessing whether it has
power over an investee, including:
• The contractual arrangement with the other vote holders of
the investee;
•R  ights arising from other contractual arrangements; and
• The Co-operative’s voting rights and potential voting rights.
The Co-operative re-assesses whether or not it controls an
investee if facts and circumstances indicate that there are
changes to one or more of the three elements of control.
Consolidation of a subsidiary begins when the Co-operative
obtains control over the subsidiary and ceases when
the Co-operative loses control of the subsidiary. Assets,
liabilities, income and expenses of a subsidiary acquired or
disposed of during the year are included in the Statement of
comprehensive income from the date the Co-operative gains
control until the date the Co-operative ceases to control the
subsidiary.
Profit or loss and each component of other comprehensive
income (OCI) are attributed to the equity holders of the parent
of the Co-operative and to the non-controlling interests,
even if this results in the noncontrolling interests having a
deficit balance. When necessary, adjustments are made to the
financial statements of subsidiaries to bring their accounting
policies into line with the Co-operative’s accounting policies. All
intra-group assets and liabilities, equity, income, expenses and
cash flows relating to transactions between members of the
Co-operative are eliminated in full on consolidation.
A change in the ownership interest of a subsidiary, without a
loss of control, is accounted for as an equity transaction. If the
Co-operative loses control over a subsidiary, it:
•D erecognises the assets (including goodwill) and liabilities of
the subsidiary;
•D erecognises the carrying amount of any non-controlling
interest;
•D erecognises the cumulative translation differences recorded
in equity;
• Recognises the fair value of the consideration received;
• Recognises the fair value of any investment retained;
• Recognises any surplus or deficit in profit or loss; and
•R eclassifies the Parent’s share of components previously
recognised in OCI to profit or loss or retained earnings, as
appropriate, as would be required if the Co-operative had
directly disposed of the related assets or liabilities.
(e) Current versus non-current classification
The Co-operative presents assets and liabilities in statement of
financial position based on current/non-current classification.
An asset is current when it is:
• E xpected to be realised or intended to sold or consumed in
normal operating cycle;
• Held primarily for the purpose of trading;
• E xpected to be realised within twelve months after the
reporting period; or
•C  ash or cash equivalent unless restricted from being
exchanged or used to settle a liability for at least twelve
months after the reporting period.
All other assets are classified as non-current. A liability is current
when:
• It is expected to be settled in normal operating cycle;
• It is held primarily for the purpose of trading;
• It is due to be settled within twelve months after the reporting
period; or
• There is no unconditional right to defer the settlement of the
liability for at least twelve months after the reporting period.
The Co-operative classifies all other liabilities as non-current.
Deferred tax assets and liabilities are classified as non-current
assets and liabilities.
(f) Revenue recognition
Revenue is recognised to the extent that it is probable that
the economic benefits will flow to the Co-operative and the
revenue can be reliably measured. The following specific
recognition criteria must also be met before revenue is
recognised:
Sale of goods
Revenue is recognised when the significant risks and rewards
of ownership of the goods have passed to the buyer and the
costs incurred or to be incurred in respect of the transaction
can be measured reliably. Risk and rewards of ownership are
considered passed to the buyer at the time of delivery of the
goods to the customer.
Rendering of services
Revenue is recognised on the basis of services provided,
measured in accordance with agreed parameters between the
customer and the Co-operative.
Interest income
Revenue is recognised as interest accrues using the effective
interest method. This is a method of calculating the amortised
cost of a financial asset and allocating the interest income over
the relevant period using the effective interest rate, which is
the rate that exactly discounts estimated future cash receipts
through the expected life of the financial asset to the net
carrying amount of the financial asset.
Dividends
Dividend revenues are recognised when control of a right to
receive consideration for the investment in assets is attained,
usually evidenced by approval of the dividend at a meeting of
shareholders.
Government grants
Grants received for the construction of non-current assets are
deferred and recorded as revenue over the life of the funded
asset.
(g) Borrowing costs
Borrowing costs consist of interest and other costs that an
entity incurs in connection with the borrowing of funds. All
loans and borrowings are initially recognised at the fair value of
the consideration received less directly attributable transaction
costs.
(h) Leases
The determination of whether an arrangement is or contains a
lease is based on the substance of the arrangement. It requires
an assessment of whether the fulfilment of the arrangement
37
 is dependent on the use of a specific asset or assets and the
arrangement conveys a right to use the asset.
Co-operative as a lessee
Finance leases, which transfer to the Co-operative substantially
all the risks and benefits incidental to ownership of the
leased item, are capitalised at the inception of the lease at
the fair value of the leased property or, if lower, at the present
value of the minimum lease payments. Lease payments are
apportioned between the finance charges and reduction of
the lease liability so as to achieve a constant rate of interest
on the remaining balance of the liability. Finance charges are
recognised as an expense in the Statement of comprehensive
income.
Capitalised leased assets are depreciated over the shorter of
the estimated useful life of the asset and the lease term if there
is no reasonable certainty that the Co-operative will obtain
ownership by the end of the lease term.
Operating lease payments are recognised as an expense in the
Statement of comprehensive income on a straight-line basis
over the lease term. Lease incentives are recognised in the
Statement of comprehensive income as an integral part of the
total lease expense.
Co-operative as a lessor
Leases in which the Co-operative retains substantially all the
risks and benefits of ownership of the leased asset are classified
as operating leases. Initial direct costs incurred in negotiating
an operating lease are added to the carrying amount of the
leased asset and recognised as an expense over the lease term
on the same basis as rental income. transaction that is not a business combination and that, at the
(i) Cash and cash equivalents
Cash and short-term deposits in the Statement of financial
position comprise cash at bank and in hand and short-term
deposits with an original maturity of three months or less. For
the purposes of the Statement of cash flows, cash and cash
equivalents consist of cash and cash equivalents as defined
above, net of outstanding bank overdrafts.
(j) Trade receivables
Trade receivables, which generally have 30-90 day terms, are
recognised and carried at original invoice amount less an
allowance for any uncollectible amounts.
An allowance for doubtful debts is made when there is
objective evidence that the Co-operative will not be able to
collect the debts. Bad debts are written off when identified.
(k) Inventories • When the deferred tax asset relating to the deductible
Inventories are valued at the lower of cost and net realisable
value.
Costs incurred in bringing each product to its present location
and condition are accounted for as follows:
• Raw materials: purchase cost on a first in, first out basis.
• Finished goods and work in progress: cost of direct
materials and labour and a proportion of manufacturing
overheads based on normal operating capacity but
excluding borrowing costs.
Net realisable value is the estimated selling price in the ordinary
course of business, less estimated costs of completion and the
estimated costs necessary to make the sale.
Maintenance spares are recognised as inventories and
38
expensed when utilised.
(l) Foreign currency translation
Both the functional and presentation currency of Norco Co-
operative Limited and its controlled entities is Australian dollars.
Transactions in foreign currencies are initially recorded in the
functional currency by applying the exchange rates ruling
at the date of the transaction. Monetary assets and liabilities
denominated in foreign currencies are retranslated at the rate
of exchange ruling at the balance sheet date.
(m) Taxes
Current income tax
Current income tax assets and liabilities for the current year
are measured at the amount expected to be recovered from
or paid to the taxation authorities. The tax rates and tax laws
used to compute the amount are those that are enacted or
substantively enacted, at the reporting date in the countries
where the Co-operative operates and generates taxable
income.
Deferred tax
Deferred tax is provided using the liability method on
temporary differences between the tax bases of assets and
liabilities and their carrying amounts for financial reporting
purposes at the reporting date.
Deferred income tax liabilities are recognised for all taxable
temporary differences except:
• When the deferred income tax liability arises from the
initial recognition of goodwill or of an asset or liability in a
time of the transaction, affects neither the accounting profit
nor taxable profit or loss.
• In respect of taxable temporary differences associated with
investments in subsidiaries, associates and interests in joint
ventures, when the timing of the reversal of the temporary
differences can be controlled and it is probable that the
temporary differences will not reverse in the foreseeable
future.
Deferred tax assets are recognised for all deductible temporary
differences, the carry forward of unused tax credits and any
unused tax losses. Deferred tax assets are recognised to the
extent that it is probable that taxable profit will be available
against which the deductible temporary differences, and the
carry forward of unused tax credits and unused tax losses can
be utilised, except:
temporary difference arises from the initial recognition of
an asset or liability in a transaction that is not a business
combination and, at the time of the transaction, affects neither
the accounting profit nor taxable profit or loss.
• In respect of deductible temporary differences associated with
investments in subsidiaries, associates and interests in joint
ventures, deferred tax assets are recognised only to the extent
that it is probable that the temporary differences will reverse
in the foreseeable future and taxable profit will be available
against which the temporary differences can be utilised.
The carrying amount of deferred tax assets is reviewed at
each reporting date and reduced to the extent that it is no
longer probable that sufficient taxable profit will be available
to allow all or part of the deferred tax asset to be utilised.
Unrecognised deferred tax assets are reassessed at each
reporting date and are recognised to the extent that it has
become probable that future taxable profits will allow the
deferred tax asset to be recovered.
Unrecognised deferred income tax assets are reassessed at
each balance sheet date and are recognised to the extent that
it is no longer probable that sufficient taxable profit will be
available to allow all or part of the deferred income tax asset to
be utilised.
Goods and services tax (GST)
Revenues, expenses and assets are recognised net of the
amount of GST, except:
• When the GST incurred on a purchase of assets or services is
not recoverable from the taxation authority, in which case the
GST is recognised as part of the cost of acquisition of the asset
or as part of the expense item, as applicable.
• When receivables and payables are stated with the amount of
GST included.
The net amount of GST recoverable from, or payable to, the
taxation authority is included as part of receivables or payables
in the Statement of financial position.
Cash flows are included in the Statement of cash flows on a
gross basis and the GST component of cash flows arising from
investing and financing activities, which is recoverable from,
or payable to, the taxation authority is classified as part of
operating cash flows.
Commitments and contingencies are disclosed net of the
amount of GST recoverable from, or payable to, the taxation
authority.
(n) Property, plant and equipment statement of comprehensive income in the year in which the
Items of property, plant and equipment including buildings
and leasehold property, but excluding freehold land, are
measured at cost less accumulated depreciation and less any
impairment losses recognised. Freehold land is held at cost and
is not depreciated.
Plant and equipment is depreciated on a straight-line basis over
the estimated useful life of the assets, units of output, life of
project or other appropriate basis.
Leasehold improvements are depreciated over the period of
the lease or estimated useful life, whichever is shorter, using the
straight-line method.
The following estimated useful lives are used in the calculation
of depreciation:
- Buildings 2 - 5%
- Plant and vehicles 10 - 33%
- Leasehold plant and equipment 10 - 20%
The assets’ residual values, useful lives and amortisation
methods are reviewed, and adjusted if appropriate, at each
financial year end.
Impairment
The carrying values of items of property, plant and equipment
are reviewed for impairment at each reporting date, with
recoverable amount being estimated when events or changes
in circumstances indicate that the carrying value may be
impaired.
The recoverable amount of property, plant and equipment
is the higher of fair value less costs to sell and value in use.
In assessing value in use, the estimated future cashflows are
discounted to their present value using a pre-tax discount rate
that reflects current market assessments of the time value of
money and the risks specific to the asset.
For an asset that does not generate largely independent cash
inflows, recoverable amount is determined for the cash-
generating unit to which the asset belongs, unless the asset’s
value in use can be estimated to be close to its fair value.
An impairment exists when the carrying value of an asset
or cash-generating unit exceeds its estimated recoverable
amount. The asset or cash-generating unit is then written down
to its recoverable amount.
Derecognition and disposal
An item of property, plant and equipment is derecognised
upon disposal or when no further future economic benefits are
expected from its use or disposal.
Any gain or loss arising on derecognition of the asset
(calculated as the difference between the net disposal proceeds
and the carrying amount of the asset) is included in profit or
loss in the year the asset is derecognised.
(o) Intangible assets
Intangible assets acquired separately are measured on initial
recognition at cost. The cost of intangible assets acquired
in a business combination are their fair value as at the date
of acquisition. Following initial recognition, intangible
assets are carried at cost less any accumulated amortisation
and accumulated impairment losses. Internally generated
intangibles, excluding capitalised development costs, are
not capitalised and the related expenditure is reflected in the
expenditure is incurred.
The useful lives of intangible assets are assessed as either finite
or indefinite.
Intangible assets with finite lives are amortised over the useful
economic life and assessed for impairment whenever there
is an indication that the intangible asset may be impaired.
The amortisation period and the amortisation method for an
intangible asset with a finite useful life are reviewed at least
at the end of each reporting period. Changes in the expected
useful life or the expected pattern of consumption of future
economic benefits embodied in the asset are considered to
modify the amortisation period or method, as appropriate,
and are treated as changes in accounting estimates. The
amortisation expense on intangible assets with finite lives is
recognised in the statement of comprehensive income as the
expense category that is consistent with the function of the
intangible assets.
Intangible assets with indefinite useful lives are not amortised,
but are tested for impairment annually, either individually or
at the cash-generating unit level. The assessment of indefinite
life is reviewed annually to determine whether the indefinite
life continues to be supportable. If not, the change in useful life
from indefinite to finite is made on a prospective basis.
Gains or losses arising from derecognition of an intangible
asset are measured as the difference between the net disposal
proceeds and the carrying amount of the asset and are
recognised in the statement of comprehensive income when
the asset is derecognised.
39
 (p) Goodwill These calculations are corroborated by valuation multiples,
Goodwill acquired in a business combination is initially
measured at cost being the excess of the cost of the business
combination over the Co-operative’s interest in the net
fair value of the acquiree’s identifiable assets, liabilities and
contingent liabilities.
Following initial recognition, goodwill is measured at cost less
any accumulated impairment losses.
Goodwill is reviewed for impairment annually or more
frequently if events or changes in circumstances indicate that
the carrying value may be impaired.
For the purpose of impairment testing, goodwill acquired in a
business combination is, from the acquisition date, allocated
to each of the Co-operatives cash-generating units, or groups
of cash-generating units, that are expected to benefit from the
synergies of the combination, irrespective of whether other
assets or liabilities of the Co-operative are assigned to those
units or groups of units. Each unit or group of units to which the
goodwill is so allocated:
• Represents the lowest level within the Co-operative at which
the goodwill is monitored for internal management purposes;
and
• Is not larger than a segment based on the Co-operative’s
primary reporting format determined as if applying AASB 8
Operating Segments.
Impairment is determined by assessing the recoverable
amount of the cash-generating unit (group of cash-generating
units), to which the goodwill relates. When the recoverable
amount of the cash-generating unit (group of cash-generating
units) is less then the carrying amount, an impairment loss is
recognised. When goodwill forms part of a cash-generating
unit (group of cash-generating units) and an operation within
that unit is disposed of, the goodwill associated with the
operation disposed of is included in the carrying amount of the
operation when determining the gain or loss on disposal of the
operation. Goodwill disposed of in this manner is measured
based on the relative values of the operation disposed of and
the portion of the cash-generating unit retained. Impairment
losses recognised for goodwill are not subsequently reversed.
(q) Impairment of non-financial assets
The Co-operative assesses, at each reporting date, whether
there is an indication that an asset may be impaired. If any
indication exists, or when annual impairment testing for
an asset is required, the Co-operative estimates the asset’s
recoverable amount. An asset’s recoverable amount is the
higher of an asset’s or cash-generating unit’s (CGU) fair value
less costs of disposal and its value in use. Recoverable amount
is determined for an individual asset, unless the asset does
not generate cash inflows that are largely independent of
those from other assets or groups of assets. When the carrying
amount of an asset or CGU exceeds its recoverable amount,
the asset is considered impaired and is written down to its
recoverable amount. Liabilities for wages and salaries, including non-monetary
In assessing value in use, the estimated future cash flows
are discounted to their present value using a pre-tax
discount rate that reflects current market assessments of
the time value of money and the risks specific to the asset.
In determining fair value less costs to sell, recent market
transactions are taken into account. If no such transactions
can be identified, an appropriate valuation model is used.
40
quoted share prices for publicly traded companies or other
available fair value indicators.
An assessment is also made at each reporting date as to
whether there is any indication that previously recognised
impairment losses may no longer exist or may have decreased.
If such an indication exists, the recoverable amount is
estimated. A previously recognised impairment loss is
reversed only if there has been a change in the estimates used
to determine the asset’s recoverable amount since the last
impairment loss was recognised. If that is the case the carrying
amount of the asset is increased to its recoverable amount.
That increased amount cannot exceed the carrying amount
that would have been determined, net of depreciation, had
no impairment loss been recognised for the asset in prior
years. Such reversal is recognised in profit or loss unless the
asset is carried at revalued amount, in which case the reversal
is treated as a revaluation increase. After such a reversal the
depreciation charge is adjusted in future periods to allocate the
asset’s revised carrying amount, less any residual value, on a
systematic basis over its remaining useful life.
(r) Trade and other payables
Trade payable and other payables are carried at amortised
cost and represent liabilities for goods and services provided
to the Co-operative prior to the end of the financial year that
are unpaid and arise when the Co-operative becomes obliged
to make future payments in respect of the purchase of these
goods and services.
(s) Interest-bearing loans and borrowings
All loans and borrowings are initially recognised at the fair
value of the consideration received less directly attributable
transaction costs.
After initial recognition, interest-bearing loans and borrowings
are subsequently measured at amortised cost using the
effective interest method.
Gains or losses are recognised in profit or loss when the
liabilities are derecognised.
(t) Provisions
General
Provisions are recognised when the Co-operative has a present
obligation (legal or constructive) as a result of a past event, it is
probable that an outflow of resources embodying economic
benefits will be required to settle the obligation and a reliable
estimate can be made of the amount of the obligation. When
the Co-operative expects some or all of a provision to be
reimbursed, for example, under an insurance contract, the
reimbursement is recognised as a separate asset, but only when
the reimbursement is virtually certain. The expense relating to
any provision is presented in the Statement of comprehensive
income net of any reimbursement.
Wages, salaries, annual leave and sick leave
benefits, annual leave and accumulating sick leave expected
to be settled within 12 months of the reporting date are
recognised in respect of employees’ services up to the
reporting date. They are measured at the amounts expected
to be paid when the liabilities are settled. Expenses for non-
accumulating sick leave are recognised when the leave is taken
and are measured at the rates paid or payable.
Long service leave an associate and a joint venture is shown on the face of the
The liability for long service leave is recognised and measured
as the present value of expected future payments to be
made in respect of services provided by employees up to
the reporting date using the projected unit credit method.
Consideration is given to expected future wage and salary
levels, experience of employee departures, and periods of
service. Expected future payments are discounted using market
yields at the reporting date on national government bonds
with terms to maturity and currencies that match, as closely as
possible, the estimated future cash outflows.
(u) Member’s interest reporting date, the Co-operative determines whether there is
In periods before 1 July 2004 members units in the Co-
operative were recorded in equity as contributed equity. On
1 July 2004 the Co-operative re-classified these instruments
to non-current interest bearing liabilities in accordance with
generally accepted International Accounting Practice. Any
distributions paid on these instruments are treated as a
borrowing cost.
This position which was clarified by UIG 2 Members’ Shares in
Co-operative Entities and Similar Instruments, which the Co-
operative adopted effective 1 July 2004.
(v) Norco capital units
Norco Capital Units are carried at the principal amount. Interest
is accrued at the entitlement rate and is included in “Interest
Bearing Liabilities.”
(w) Investments in joint venture 3. Significant accounting judgements, estimates and
A joint venture is a type of joint arrangement whereby the
parties that have joint control of the arrangement have rights
to the net assets of the joint venture. Joint control is the
contractually agreed sharing of control of an arrangement,
which exists only when decisions about the relevant activities
require unanimous consent of the parties sharing control.
The considerations made in determining significant influence
or joint control are similar to those necessary to determine
control over subsidiaries.
The Co-operative’s investments in its associate and joint
venture are accounted for using the equity method.
Under the equity method, the investment in an associate or a
joint venture is initially recognised at cost. The carrying amount
of the investment is adjusted to recognise changes in the Co-
operative’s share of net assets of the associate or joint venture
since the acquisition date. Goodwill relating to the associate
or joint venture is included in the carrying amount of the
investment and is neither amortised nor individually tested for
impairment.
The Statement of comprehensive income reflects the Co-
operative’s share of the results of operations of the associate
or joint venture. Any change in other comprehensive income
of those investees is presented as part of the Co-operative’s
other comprehensive income. In addition, when there has
been a change recognised directly in the equity of the associate
or joint venture, the Co-operative recognises its share of any
changes, when applicable, in the Statement of changes in
equity. Unrealised gains and losses resulting from transactions
between the Co-operative and the associate or joint venture
are eliminated to the extent of the interest in the associate or
joint venture.
The aggregate of the Co-operative’s share of profit or loss of
Statement of comprehensive income outside operating profit
and represents profit or loss after tax and non-controlling
interests in the subsidiaries of the associate or joint venture.
The financial statement of the associate or joint venture are
prepared for the same reporting period as the Co-operative.
When necessary, adjustments are made to bring the
accounting policies in line with those of the Co-operative.
After application of the equity method, the Co-operative
determines whether it is necessary to recognise an impairment
loss on its investment in its associate or joint venture. At each
objective evidence that the investment in the associate or joint
venture is impaired. If there is such evidence, the Co-operative
calculates the amount of impairment as the difference between
the recoverable amount of the associate or joint venture
and its carrying value, then recognises the loss as ‘Share of
profit of an associate and a joint venture’ in the Statement of
comprehensive income.
Upon loss of significant influence over the associate or joint
control over the joint venture, the Co-operative measures
and recognises any retaining investment at its fair value. Any
difference between the carrying amount of the associate or
joint venture upon loss of significant influence or joint control
and the fair value of the retained investment and proceeds
from disposal is recognised in the Statement of comprehensive
income.
assumptions
Significant judgements
The preparation of the financial statements requires
management to make judgments, estimates and assumptions
that affect the reported amounts in the financial statements.
Management continually evaluates its judgments and
estimates in relation to assets, liabilities, contingent liabilities,
revenue and expenses. Management bases its judgments and
estimates on historical experience and on other various factors
it believes to be reasonable under the circumstances, the
result of which form the basis of the carrying values of assets
and liabilities that are not readily apparent from other sources.
Actual results may differ from these estimates under different
assumptions and conditions.
Management has identified the following critical accounting
policies for which significant judgments, estimates and
assumptions are made. Actual results may differ from these
estimates under different assumptions and conditions and
may materially affect financial results or the financial position
reported in future periods.
Further details of the nature of these assumptions and
conditions may be found in the relevant notes to the financial
statements.
Impairment of non-financial assets other than goodwill
The Co-operative assesses impairment of all assets at each
reporting date by evaluating conditions specific to the
Co-operative and to the particular asset that may lead to
impairment. These include product and manufacturing
performance, technology, economic and political environments
and future product expectations. If an impairment trigger exists
the recoverable amount of the asset is determined.
41
 4. Revenue and expenses

4.1 Revenue
2014 2013
$000 $000
Sale of goods 428,662 368,339
Interest received 330 314
Other 1,737 1,238
430,729 369,891

4.2 Employee expenses

2014 2013
$000 $000
Salaries and wages (including contractors) 41,213 36,515
Workers compensation 3,824 3,496
Superannuation costs 3,003 2,553
Payroll tax 1,866 1,582
49,906 44,146

4.3 Depreciation expense

2014 2013
$000 $000
Plant and equipment 4,773 4,215
Buildings 453 445
Leased assets 159 171
5,385 4,831

4.4 Administration and other costs

Administration and other costs include the following:

2014 2013
$000 $000
Provision for employee benefits 783 792
Inventory obsolescence 90 67
Doubtful/bad debts 56 (169)

5. Income tax expense

The major components of income tax expense for the years ended 30 June 2014 and 2013 are:

Statement of comprehensive income

2014 2013
$000 $000
Current income tax:
Current income tax charge - -
Adjustments for current tax of prior periods - -

Deferred tax:
Relating to origination and reversal of temporary differences - -
Income tax benefit/(expense) reported in the Statement of comprehensive
income - -

42
A reconciliation between tax expense and the product of accounting profit before income tax multiplied by Co-operative applicable
income tax rate is as follows:

2014 2013
$000 $000

Accounting profit/(loss) before income tax 316 (1,112)

At Australia’s statutory income tax rate of 30% (2013: 30%) 95 (334)

Non deductible amounts (108) (212)

Movement in temporary differences 92 (548)
Income tax loss movement (3,350) (5,436)
Adjustment in respect of current income tax of previous years 3,271 6,530
- -

Tax losses
At 30 June 2014, the Co-operative had an estimated gross $15.8m in carry forward losses (2013: $16.9m). These tax losses have not
been brought to account in the Statement of financial position. There are no available franking credits.

Temporary differences - not recorded

The Co-operative has a surplus of deductible temporary differences. The deferred tax asset associated with these differences has not
been recognised at 30 June 2014.

2014 2013
$000 $000
Unrecognised deferred tax assets and liabilities
Provision for bad debts 272 404
Provision for employee benefits 2,856 2,614
Provision for obsolescence 281 483
Temporary difference 3,409 3,501

6. Member distributions
2014 2013
$000 $000

Expensed in the period 46 692

7. Trade and other receivables

2014 2013
$000 $000
Trade receivables 47,423 41,376
Provision for doubtful debts (906) (1,346)
46,517 40,030

Other receivables 972 847

47,489 40,877

43
 Doubtful debts
Carrying amount of doubtful debts $000
Opening balance year 2012 1,086
(Reduction)/addition in provision 429
Amount utilised during the year (169)
Ending balance year 2013 1,346

Opening balance year 2013 1,346

(Reduction)/addition in provision (496)
Amount utilised during the year 56
Ending balance year 2014 906

Trade receivables are generally on 30 day terms. An allowance for doubtful debts is made where there is objective evidence that a
trade receivable is impaired. The carrying value of trade and other receivables approximates fair value.

At 30 June, the ageing analysis of trade receivables is as follows (in $000’s):

< 30 30-60 61-90 91+

Total days days days days
$000 $000 $000 $000 $000
2014 47,423 28,907 13,091 2,904 2,521
2013 41,376 25,471 10,984 1,995 2,926

Receivables past due but not considered impaired are: $6,661,999 (2013: $6,011,539). Payment terms have not been renegotiated,
however communications with counterparties have satisfied management that payment will be received in full.

8. Inventories
2014 2013
$000 $000

Raw materials 6,689 6,177

Finished goods 22,896 20,654
Work in progress 1,000 196
Provision to net realisable value (938) (1,612)
Total inventories at the lower of cost and net realisable value 29,647 25,415

An allowance for inventory obsolescence is made where there is objective evidence that inventories are carried in excess of their net
realisable value.

9. Investments
2014 2013
$000 $000
Shares
Unlisted corporations, at cost 3 3

44
10. Property, plant and equipment
2014 2013
$000 $000
Land and buildings
At cost 28,427 28,161
Accumulated depreciation (4,390) (3,935)
Net carrying amount 24,037 24,226

Plant and vehicles

At cost 91,780 87,609
Accumulated depreciation (68,562) (63,973)
Net carrying amount 23,218 23,636

Assets under lease

At cost 2,972 1,152
Accumulated depreciation (788) (629)
Net carrying amount 2,184 523

Capital expenditure work in progress

At cost 4,296 695
Net carrying amount 4,296 695

Total property, plant and equipment

At cost 127,475 117,617
Accumulated depreciation (73,740) (68,537)
Net carrying amount 53,735 40,080

Reconciliation of carrying amounts at the beginning and the end of the year

Reconciliation
Reconciliations of the carrying amounts of each class of property, plant and equipment
Land and buildings
At 1 July 24,226 25,032
Disposals - (529)
Reclassification 44 -
Transfers 220 168
Depreciation expense (453) (445)
At 30 June 24,037 24,226

Plant and vehicles

At 1 July 23,636 18,400
Additions from business combination - 664
Disposals - (427)
Reclassification (44) -
Transfers 4,399 9,214
Depreciation expense (4,773) (4,215)
At 30 June 23,218 23,636

45
 2014 2013
$000 $000
Assets under lease
At 1 July 523 828
Additions 1,860 -
Disposals (40) (214)
Transfers - 80
Depreciation expense (159) (171)
At 30 June 2,184 523

Capital expenditure work in progress

At 1 July 695 1,395
Additions 8,220 8,762
Transfers (4,619) (9,462)
At 30 June 4,296 695

Total property, plant and equipment

At 1 July 49,080 45,655
Additions 10,080 8,762
Additions from business combination - 664
Disposals (40) (1,170)
Depreciation expense (5,385) (4,831)
At 30 June 53,735 49,080

There were no impairment losses recognised in the 2014 or 2013 financial years.

Leased manufacturing plant is pledged as security for the related finance lease liabilities.

Freehold land, buildings and plant and equipment are subject to a fixed and floating first charge of the Co-operative’s assets as
disclosed in note 14(c). All assets and undertakings are pledged as security on the interest bearing liabilities of the Co-operative and
controlled entities.

All assets acquired under finance lease were acquired for nil cash flow and are considered to be a non-cash financing and investing
activity.

11. Intangible assets and goodwill

2014 2013
$000 $000

Acquired goodwill 34,372 34,352

Trademark 2,729 2,729
Net carrying amount 37,101 37,081

During 2013, Goodwill of $1.3 million and Trademarks of $2.7 million were recognised in relation to the Fonterra business. Refer Note 19.
(a) Impairment testing of goodwill

Goodwill acquired through business combinations has been allocated at an entity level to the relevant cash generating units.

The discount rate applied to cash flow projections is 14% pre-tax (2013: 12%)

Key assumptions used in the value in use calculation are:

• Revenue: based on projected growth predictions;

• Cost of sales: based on revenue growth; and
• Other costs: based on store growth and expected wage increases.

46
12. Trade and other payables
2014 2013
Current $000 $000
Trade payables and accrued expenses 56,330 50,617
Other payables - 767
Member deposits 335 933
56,665 52,317

Non-current
Other payables 398 397

Trade payables are generally on 30 day terms. The fair value of trade and other payables approximates their carrying value.

13. Employee benefit liabilities

2014 2013
$000 $000
Current
Employee entitlements 8,235 7,642

Non-current
Employee entitlements 1,309 1,151

14. Interest bearing loans and borrowings

2014 2013
$000 $000
Current
Lease liability 467 123
Norco Capital Units 122 122
589 245
Non-current
Lease liability 1,759 430
Term loans - secured 31,910 26,771
33,669 27,201

Term loans are secured by a fixed and floating charge over the assets of Norco Co-operative Limited.

During the year, the Co-operative’s St George finance term was amended and is scheduled to expire on 31 October 2015. On this
basis, the liability has been classified as non-current at 30 June 2014.

Refer to Note 14(d) for financing facilities available to the Co-operative.

(a) Fair values

The carrying amount of the consolidated entity’s current and non-current borrowings approximates their fair value. The fair values
have been calculated by discounting the expected future cash flows at prevailing market interest rates varying from 8.0% to 9.0%,
depending on the type of borrowing.

47
 (b) Interest rate, foreign exchange and liquidity risk

Details regarding interest rate, foreign exchange and liquidity risk is disclosed in Note 29.

(c) Assets pledged as security

The carrying amounts of assets pledged as security for current and non-current interest bearing liabilities are:

2014 2013
$000 $000
Property asset charges 51,551 48,557
Leased asset charges 2,184 523
Trademark 2,729 2,729
Total assets pledged as security 56,464 51,809

There are no specific terms and conditions related to the above pledges.

(d) Financing facilities

The following financing facilities are available for the Co-operative at 30 June:

2014 2013
$000 $000
Term loan facilities
Used facilities 31,910 26,910
Unused facilities 1,075 575
32,985 27,485
Bank overdrafts
Used facilities - -
Unused facilities 9,000 7,000
9,000 7,000
Bank guarantees
Used facilities 25 25
Unused facilities 78 78
103 103
Business credit card facility
Used facilities 40 50
Unused facilities 100 80
140 130
Other
Used facilities 100 178
Unused facilities 1,117 1,049
1,217 1,227
Total finance facilities
Used facilities 32,075 27,163
Unused facilities 11,370 8,782
43,445 35,945

48
15. Members’ interest
15.1 Movements in shares on issue
$000
Opening balance - 6,828,000 fully paid shares 6,828
Transferred to deposits ex-shareholders (135)
Subscriptions 818
At July 2013 7,511

Opening balance - 7,511,000 fully paid shares 7,511

Transferred to deposits ex-shareholders (201)
Subscriptions 860
At 30 June 2014 8,170

15.2 Terms and conditions of contributed equity

Contributed equity has rights in accordance with the Co-operatives National Law (NSW).

16 Reserves
Asset revaluation reserve
Effective 1 July 2004 the Co-operative changed the valuation basis applied to non-current land and buildings. Under historical AGAAP
the Co-operative carried land and buildings at fair value. From 1 July 2004 the Co-operative deemed the fair value to be cost. The
asset revaluation reserve represents the historical accumulation of revaluation adjustments. The reserve will no longer be available
to offset decrements in the value of land and buildings and will be transferred to retained earnings on depreciation and/or disposal
of land and buildings.

17. Statement of cash flows reconciliation

17.1 Cash flow reconciliation

2014 2013
$000 $000

Reconciliation of net profit after tax to net cash flows from operations:
Profit/(loss) before tax from continuing operations 316 (1,112)
Adjustments for:
Depreciation of property, plant and equipment 5,385 4,831
Member distribution expense 46 627
Net profit on disposal of property, plant and equipment (84) (550)
Changes in assets and liabilities:
(Increase)/decrease in trade and other receivables (6,612) (7,069)
(Increase)/decrease in inventories (4,232) (1,107)
(Increase)/decrease in other assets (74) (143)
Increase/(decrease) in trade and other payables 4,946 6,661
Increase/(decrease) in provisions 751 653
Net cash flows from operating activities 442 2,791

17.2 Non-cash financing and investing activities

2014 2013
$000 $000
Dividends reinvested - 65

49
 17.3 Reconciliation of cash
2014 2013
$000 $000
Cash on hand and with financial institutions 1,802 4,488

18 Controlled entities

% equity interest Investment $000

Principal
Name activities 2014 2013 2014 2013
Logan Valley Dairies Pty Ltd Dormant 100% 100% 165 165
Norco Wholesalers Pty Ltd* Wholesaler 100% 100% - -
Fieldco Pty Ltd* Dormant 100% 100% - -
Norcofields Pty Ltd* Dormant 100% 100% - -
Beaudesert Milk Pty Ltd* Dormant 100% 100% - -
Norco Milk Pty Ltd** Dormant 100% 100% - -
Gold Coast Pty Ltd Property 100% 100% 15,783 15,783
Holder
ACN 146 859 074 Pty Ltd* Dormant 100% 100% - -

15,948 15,948

* Investment <$101
** 100 shares at $1 each

19. Business combination

Acquisition of Fonterra business

On 9 November 2012, Norco Co-operative Limited acquired the Fonterra business from Fonterra Brands (Australia) Pty Ltd, a business
comprising marketing, distribution and licencing rights.

The acquisition was achieved by way of the purchase of the Fonterra distribution network and property, plant and equipment funded
by a net cash payment of $4.2 million, after allowing for employee entitlements.

The fair values of the identifiable assets and liabilities of the Fonterra business as of the date of acquisition were:

2013
$000
Inventories 613
Property, plant and equipment 3,393
Total assets 4,006

Employee entitlements (1,159)

Total liabilities (1,159)

Total identifiable net assets at fair value 2,847

Goodwill arising on acquisition (Note 11) 1,346
Purchased consideration transferred 4,193

Direct costs relating to the acquisition comprising legal costs and stamp duty recognised within Restructure costs were $310k.
The goodwill of $1.3 million comprises the value of expected synergies arising from the acquisition.
None of the goodwill is expected to be deductible for income tax purposes.

50
20. Commitments
Capitalised finance lease commitments for plant and vehicles:
2014 2013
$000 $000
Within one year 516 137
After one year but not more than five years 1,781 282
More than five years 119 153
Total minimum lease payments 2,416 572
Deduct future finance charges (190) (19)
2,226 553

Non-cancellable operating lease commitments for equipment, land and buildings:

2014 2013
$000 $000
Within one year 2,514 2,389
After one year but not more than five years 4,509 5,799
More than five years 36 206
7,059 8,394

Cancellable operating lease commitments for vehicles and plant:

2014 2013
$000 $000
Within one year 761 809
After one year but not more than five years 809 1,035

1,570 1,844

21 Contingent liabilities

Legal Actions
The directors are not aware of any material legal actions being brought against the Co-operative, its controlled entities or any joint
venture to which the Co-operative holds an interest which has not been provided for.

Bank Guarantees
Contingent liabilities exist in respect of bank guarantees given to various parties that amount to $25,000 (2013: $25,000) and are not
included as creditors.

22 Financial guarantee contracts

The Co-operative has no outstanding financial guarantee contracts at 30 June 2014 (2013: Nil).

23 Capital management

The Co-operative manages its capital structure through regular reviews of its exposure to debt and members as shareholders. The
Co-operative has no set levels for equity and debt. The management of the Co-operative views members shares as equity. Member’s
interests are managed in line with the requirements of the Co-operatives National Law (NSW). The Co-operative has complied with all
requirements of the Co-operatives National Law (NSW) during the year.

51
 24. Related party disclosures
Material transactions and balances with related parties are as follows:

Net trading Net trading Goods and Rental Rental

debt payable debt payable services paid received
(current) (non-current) purchased

$000 $000 $000 $000 $000

Wholly owned group
Norco Wholesalers Pty Limited
2014 28,356 - 340,278 - -
2013 25,279 - 303,349 - -
Logan Valley Dairies Pty Limited
2014 - 397 - - -
2013 - 397 - - -
Gold Coast Milk Pty Ltd
2014 - - - - -
2013 - - - 713 352

Shareholding in controlled entities are outlined in Note 18.

Sales to and purchases from related parties are made in arm’s length transactions both at normal market prices and on normal
commercial terms.

25 Directors and executive disclosures

25.1 Key management personnel

(i) The directors of Norco Co-operative during the financial year were:
Greg McNamara (Non-Executive Chairman)
Peter Neal (Non-executive)
Thomas Cooper (Non-executive)
David Hodges (Independent Director)
Anthony Wilson (Non-executive)
Michael Jeffery (Non-executive)
Leigh Shearman (Non-executive)

(ii) Executives of Norco Co-operative during the financial year were:

Brett Kelly (Chief Executive Officer)
Camille Hogan (Chief Financial Officer)
Mark Myers (Co-operative Secretary)
Yasmin Lawrence (Human Resource Manager) (i)
John Kendall (Human Resources Manager) (i)
Andrew Burns (GM Norco Foods)
I Foote (GM Operations)
Damon Bailey (GM Norco Rural / Agribusiness)
Rob Randall (GM Milk Supply) (ii)

(i) Yasmin Lawrence returned from maternity leave and into the Human Resources Manager position on 21 October 2013. John
Kendall finished in this role on this date.
(ii) Rob Randall was appointed as General Manager of Milk Supply. This appointment was effective 1 July 2013.

52
25.2 Compensation of key management personnel
2014 2013
$ $
Short term - wages and salaries 1,511,626 1,350,300
Incentive 57,900 124,797
Superannuation 135,026 118,108
Non-cash 15,000 15,000
Total compensation 1,719,552 1,608,205

The above amounts only relate to the cash and other benefits paid to key management personnel for the period of their employment
with the Co-operative or for the period they held a position as a key management person.

25.3 Transactions with and balances with key management personnel

Purchases
Purchases of milk from key management personnel and related entities are on the same commercial terms and conditions as enjoyed
by other non key management personnel members.

Sales
Sale of farm supplies and stores to key management personnel and related entities are on the same commercial terms and conditions
as enjoyed by other non key management personnel members.

25.4 Share transactions

2014 2013
$000 $000

Aggregate number of shares held by Co-operative key management personnel

and their related entities at 30 June 501,622 456,565
Aggregate number of shares acquired by key management personnel and their related entities
during the year 48,162 74,377

26 Superannuation commitments

All employees participate in an employer sponsored defined contribution/accumulation style superannuation plan. Contributions by
the Co-operative of 9.25% of employees’ wages and salaries are legally enforceable except employees of the Ice Cream division who
are paid 11% superannuation commitments in line with their Enterprise Bargaining Agreement.

27. Auditors’ remuneration

The auditor of Norco Co-operative Limited is Ernst & Young.

2014 2013
$ $
Amounts received or due and receivable by Ernst & Young for:
An audit or review of the financial report 131,400 138,900
Other services
Financial statement compilation 10,800 10,800
142,200 149,700

53
 28. Information relating to the Norco Co-operative Limited (the Parent)
2014 2013
$000 $000

Information relating to Norco Co-operative Limited:

Current assets 78,402 70,822

Total assets 153,467 141,204

Total liabilities (98,860) (87,572)
Net assets attributable to members 54,607 53,632

Members interest 11,395 10,736

Net assets 43,212 42,896

Asset revaluation reserve 31,214 31,214

Retained profits 11,998 11,682
Total equity 43,212 42,896

Profit/(loss) of the parent entity 316 (1,112)

Total comprehensive income/(loss) of the parent 316 (1,112)

Details of any guarantees entered into by the parent entity in relation to the debts of its subsidiaries
The Parent’s share of the jointly controlled entities financial guarantees is included in disclosures in Note 22.

Details of any contingent liabilities of the parent entity

The Parent’s share of the jointly controlled entities contingent liabilities is included in disclosures in Note 21.

Details of any contractual commitments by the parent entity for the acquisition of property, plant or equipment
The Parent’s share of the jointly controlled entities commitments is included in disclosures in Note 20.

29. Financial risk management objectives and policies

The Co-operative’s principal financial liabilities, other than derivatives, comprise loans and borrowings, trade and other payables, and
financial guarantee contracts. The main purpose of these financial liabilities is to finance the Co-operative’s operations and to provide
guarantees to support its operations. The Co-operative has loans and other receivables, trade and other receivables, and cash and
short-term deposits that arrive directly from its operations. The Co-operative also holds available-for-sale investments and enters into
derivative transactions.

The Co-operative is exposed to market risk, credit risk and liquidity risk. The Co-operative’s senior management oversees the
management of these risks. The Co-operative’s senior management is supported by a financial risk committee that advises on financial
risks and the appropriate financial risk governance framework for the Co-operative. The financial risk committee provides assurance
to the Co-operative’s senior management that the Co-operative’s financial risk-taking activities are governed by appropriate policies
and procedures and that financial risks are identified, measured and managed in accordance with the Co-operative’s policies and risk
objectives. All derivative activities for risk management purposes are carried out by specialist teams that have the appropriate skills,
experience and supervision. It is the Co-operative’s policy that no trading in derivatives for speculative purposes shall be undertaken.
The board of directors reviews and agrees policies for managing each of these risks which are summarised below.

Risk exposures and responses

Interest rate risk

The consolidated entity’s exposure to interest rates relates primarily to the consolidated entity’s long-term debt and overdraft obligations.
The level of debt is disclosed in Note 14.

At balance date, the Co-operative had the following mix of financial assets and liabilities exposed to Australian Variable interest rate risk.

54
 2014 2013
$000 $000

Financial assets and liabilities

Cash and cash equialents 1,802 4,488
Interest bearing loan (31,910) (26,771)
Net exposure (30,108) (22,283)

The Co-operative’s policy is to manage its finance costs using a mix of fixed and variable rate debt. The Co-operative constantly
analyses its interest rate exposure.
The following sensitivity analysis is based on the interest rate risk exposures in existence at the balance sheet date:
At 30 June 2014, if interest rates had moved, as illustrated in the table below, with all other variables held constant, post tax profit and
equity would have been affected as follows:

Judgements of reasonably possible movements: Post tax profit Equity

Higher/(Lower) Higher/(Lower)
2014 2013 2014 2013
$000 $000 $000 $000

CONSOLIDATED
+1.0% (100 basis points) (319) (268) (319) (268)
-1.0% (100 basis points) 319 268 319 268

The movements in profit are due to higher/lower interest costs from variable rate debt and cash balances.

There are no differences in movements in equity as no hedging instruments were in use. The effect on profit and equity is higher in
2014 than in 2013 because of the increase in interest bearing liabilities exposed to interest rate movements as at 30 June 2014.

Foreign currency risk

The Co-operative has no material exposure to foreign currency therefore this is not an applicable risk.

Commodity price risk

The Co-operatives exposure to commodity price risk is present through the grain purchasing requirements for the animal nutrition business.
It is the Co-operatives policy to secure grain quantities and prices through forward grain contracts. As these contracts are regular advance
purchase contracts for process inputs, derivative accounting is not applied and contract fair value movements are not recorded.

Credit risk

Credit risk arises from the financial assets of the Co-operative, which comprise cash and cash equivalents and trade and other
receivables. The Co-operative’s exposure to credit risk arises from potential default of the counter party, with a maximum exposure
equal to the carrying amount of these instruments. Exposure at balance date is addressed in each applicable note.
The Co-operative does not hold any credit derivatives to offset its credit exposure.
The Co-operative trades only with recognised, creditworthy third parties, and as such collateral is not requested nor is it the Co-
operative’s policy to securitise its trade and other receivables.
It is the Co-operatives policy that all customers who wish to trade on credit terms are subject to credit verification procedures
including an assessment of their independent credit rating, financial position, past experience and industry reputation. Risk limits
are set for each individual customer in accordance with parameters set by the board. These risk limits are regularly monitored.
In addition, receivable balances are monitored on an ongoing basis with the result that the Co-operative’s exposure to bad debts is
not significant.
There are no significant concentrations of credit risk within the consolidated entity.

55
 Liquidity risk

The Co-operatives objective is to maintain a balance between continuity of funding and flexibility through the use of bank overdrafts,
bank loans, finance leases and committed available credit lines.
The table below reflects contractual finance principal repayments and interest resulting from recognised financial liabilities as of 30
June 2014. Cash flows for financial liabilities without fixed amount or timing are based on the conditions existing at 30 June 2014.
The remaining contractual maturities of the consolidated entity’s and parent entity’s financial liabilities are presented with an analysis
of the financial assets.

2014 2013
$000 $000
0-1 year 56,116 52,307
1-5 years 33,948 27,880
Over 5 years 119 -
90,183 80,187

Maturity analysis of financial assets and liability based on management’s expectation.

The risk implied from the values shown in the table below reflects a balanced view of cash inflows and outflows. Leasing
obligations, trade payables and other financial liabilities mainly originate from the financing of assets used in our ongoing
operations such as property, plant, equipment and investments in working capital e.g. inventories and trade receivables. These
assets are considered in the consolidated entity’s overall liquidity risk.

1 to 5 Over
Year ended 30 June 2014 <12 months years 5 years Total
$000 $000 $000 $000

Cash and cash equivalents 1,802 - - 1,802

Trade and other receivables 47,489 - - 47,489
Interest bearing loans and borrowings - (31,910) - (31,910)
Finance leases (516) (1,781) (119) (2,416)
Trade and other payables (56,665) (398) - (57,063)
Net maturity (7,890) (34,089) (119) (42,098)

1 to 5 Over
Year ended 30 June 2013 <12 months years 5 years Total
$000 $000 $000 $000

Cash and cash equivalents 4,488 - - 4,488

Trade and other receivables 40,877 - - 40,877
Interest bearing loans and borrowings (289) (25,827) - (26,116)
Finance leases (137) (282) (153) (572)
Trade and other payables (52,317) (397) - (52,714)
Net maturity (7,378) (26,506) (153) (34,037)

Fair value
The methods for estimating fair value are outlined in the relevant notes to the financial statements.

30. Events after the reporting period

There have been no significant events occurring after the reporting period which may affect either the Co-operative’s operations or
results of those operations or the Co-operative’s state of affairs.

56
Directors’
declaration

In accordance with a resolution of the directors of Norco Co-operative Limited, I state that:

In the opinion of the directors:

(a) the financial statements and notes of the consolidated entity are in accordance with the Corporations Act 2001 and Co-
operatives National Law (NSW), including:

(i) giving a true and fair view of the consolidated entity’s financial position as at 30 June 2014 and of its
performance for the year ended on that date; and

(ii) complying with Accounting Standards, as required by the Co-operatives National Law (NSW); and

(b) there are reasonable grounds to believe that the Co-operative will be able to pay its debts as and when they become
due and payable.

On behalf of the Board

G.J. McNamara
Chairman

Lismore
24 September 2014

57
58
59
 corporate
directory
Registered Office
Norco Co-operative Limited
ARBN 009 717 417 / ABN 17 009 717 417
‘Windmill Grove’, 107 Wilson Street
SOUTH LISMORE NSW 2480
T: 02 6627 8000 F: 02 6621 9673
W: www.norco.com.au
branch
directory
head offices
NORCO CORPORATE
‘Windmill Grove’, 107 Wilson Street SOUTH LISMORE
NSW 2480 (PO Box 486 LISMORE NSW 2480)
Phone: 02 6627 8000 Fax: 02 6621 9673
NORCO RURAL
‘Windmill Grove’, 107 Wilson Street, SOUTH LISMORE
NSW 2480 (PO Box 3107 LISMORE DC NSW 2480)
Phone: 02 6627 8000 Fax: 02 6622 1730
NORCO AGRIBUSINESS
‘Windmill Grove’, 107 Wilson Street SOUTH LISMORE
NSW 2480 (PO Box 3107 LISMORE DC NSW 2480)
Phone: 02 6627 8000 Fax: 02 6622 1730
MILK SUPPLY
‘Windmill Grove’, 107 Wilson Street SOUTH LISMORE
NSW 2480 (PO Box 486, LISMORE NSW 2480)
Phone: 02 6627 8029 Fax: 02 6622 7410
NORCO FOODS
NORCO MILK – LABRADOR
Cnr Pine Ridge Road & Gold Coast Highway
LABRADOR QLD 4215 (PO Box 530, SOUTHPORT QLD 4215)
Phone: 07 5511 7200 Fax: 07 5594 0101
NORCO MILK – RALEIGH
North Street RALEIGH NSW 2454
Phone: 02 6692 0000 Fax: 02 6655 4447
60
Financiers/Bankers
St George Bank
Level 13, 182 George Street SYDNEY NSW 2000
Auditors
Ernst & Young Chartered Accountants
Level 5 Waterfront Place, 1 Eagle Street
BRISBANE QLD 4000
Solicitors
Thomsons Geer Lawyers S+P Lawyers
BRISBANE QLD 4000 LISMORE NSW 2480
Piper Alderman Lawyers
SYDNEY NSW 2000
ICE CREAM BUSINESS UNIT
Union Street SOUTH LISMORE NSW 2480
(PO Box 486, LISMORE NSW 2480)
Phone: 02 6627 8000 Fax: 02 6621 6120
NORCO AGRIBUSINESS – GOLDMIX AND GRAIN TRADING
GOLDMIX STOCKFEEDS
Krauss Avenue SOUTH LISMORE NSW 2480
Phone: 02 6621 3042 Fax: 02 6621 9170
GOLDMIX STOCKFEEDS
2814 Murgon – Gayndah Road WINDERA QLD 4605
(PO Box 346 MURGON QLD 4605)
Phone: 07 4168 6186 Fax: 07 4168 6214
GOLDMIX CREST SEEDS
316 Anzac Avenue TOOWOOMBA QLD 4350
Phone: 07 4630 2318 Fax: 07 4630 2348
GRAIN TRADING – TOOWOOMBA
300-312 Anzac Avenue TOOWOOMBA QLD 4350
Phone: 07 4637 3315 Fax: 07 4637 3399
NORCO RURAL BRANCHES
ALSTONVILLE
17 Kays Lane Russelton Estate ALSTONVILLE NSW 2477
Phone: 02 6628 8315 Fax: 02 6628 5765
ARMIDALE
252 Mann Street ARMIDALE NSW 2350
Phone: 02 6771 4669 Fax: 02 6771 1187
Norco’s Purpose
Norco’s purpose is to build wealth, security
and sustainability for our shareholders,
business partners and employees.
We achieve this by:
• maintaining a diverse and strong range of
businesses;
• being a competitive regional purchaser and
supplier of milk; and
• creating integrated solutions for our partners.
Norco’s Values
Norco applies a common set of values to everything it does.
These values include:
Respect
• We respect our shareholders, employees, business partners
and customers.
• We respect a diversity of views and opinions.
• We encourage and support people to grow as individuals
and contributors to our organisation.
• We respect our heritage and legacy.
• We respect our natural environment.
Responsible
• We are responsible for preserving the co-operative
principles.
• We are responsible for our actions and our performance.
• We are responsible for providing a safe work environment.
Efficient
• We seek to add value in everything we do.
Innovation
• We seek to consistently improve through innovation.
Community
• We seek active involvement in our communities.
NORCO RURAL BRANCHES cont.
BEAUDESERT
9A Thiedeke Road BEAUDESERT QLD 4285
Phone: 07 5541 4882 Fax: 07 5541 1025
BELLINGEN
1076 Waterfall Way BELLINGEN NSW 2454
Phone: 02 6655 9792 Fax: 02 6655 2266
BOWRAVILLE
51 Carbin Street BOWRAVILLE NSW 2449
Phone: 02 6564 8648 Fax: 02 6564 7425 Phone: 07 4168 3060 Fax: 07 4168 2996
BUNDABERG
71 Gavin Street BUNDABERG QLD 4670
Phone: 07 4151 7883 Fax: 07 4154 4341 Phone: 02 6672 2311 Fax: 02 6672 5120
CASINO
136 Dyraaba Street CASINO NSW 2470
Phone: 02 6661 2100 Fax: 02 6662 6007
COFFS HARBOUR
24 Isles Drive SOUTH COFFS HARBOUR NSW 2450
Phone: 02 6658 0393 Fax: 02 6658 0374
DUNGOG
Stroud Road DUNGOG NSW 2420
Phone: 02 4992 1087 Fax: 02 4992 3000
GLEN INNES
165 Lang Street GLEN INNES NSW 2370
Phone: 02 6732 2162 Fax: 02 6732 5642
GLOUCESTER
Cnr Church & Phillip Streets GLOUCESTER NSW 2422
Phone: 02 6558 9600 Fax: 02 6558 9666
GRAFTON
19 Queen Street GRAFTON NSW 2460
Phone: 02 6643 5630 Fax: 02 6642 7245
HEATHERBRAE
9 Hank Street HEATHERBRAE NSW 2324
Phone: 02 4987 6500 Fax: 02 4987 6099 300-312 Anzac Ave TOOWOOMBA QLD 4350
KEMPSEY
3 Kemp Street WEST KEMPSEY NSW 2440
Phone: 02 6562 6393 Fax: 02 6563 1020 120 Allora – Clifton Road ALLORA QLD 4362
KINGAROY
97 River Road KINGAROY QLD 4610
Phone: 07 4163 6310 Fax: 07 4162 4992
KYOGLE
Willis Street KYOGLE NSW 2474
Phone: 02 6632 2920 Fax: 02 6632 1221
LISMORE
105 Wilson Street SOUTH LISMORE NSW 2480
Phone: 02 6627 8266 Fax: 02 6621 2286
MACKSVILLE
Tilly Willy Street MACKSVILLE NSW 2447
Phone: 02 6568 4057 Fax: 02 6568 2308
MURGON
21 Lamb Street MURGON QLD 4605
MURWILLUMBAH
17 Buchanan Street MURWILLUMBAH NSW 2484
STUARTS POINT
906 Stuarts Point Road STUARTS POINT NSW 2441
Phone: 02 6569 0955 Fax: 02 6569 0983
TAREE
5 Grey Gum Road TAREE NSW 2430
Phone: 02 6551 2999 Fax: 02 6551 2522
TENTERFIELD
445 Rouse Street TENTERFIELD NSW 2372
Phone: 02 6736 5902 Fax: 02 6736 2270
WINDERA DEPOT
2814 Murgon – Gayndah Road WINDERA QLD 4605
Phone: 07 4168 6186 Fax: 07 4168 6214
WOOLGOOLGA
16 Featherstone Drive WOOLGOOLGA NSW 2456
Phone: 02 6654 2905 Fax: 02 6654 1031
WOOLGOOLGA CARTON SERVICES
8 Bosworth Road WOOLGOOLGA NSW 2456
Phone: 02 6654 8078 Fax: 02 6654 0103
NORCO RURAL RETAIL BRANCHES – NORCO BOWDLERS
NORCO BOWDLERS – TOOWOOMBA
Phone: 07 4637 3300 Fax: 07 4637 3399
NORCO BOWDLERS – ALLORA
Phone: 07 4666 2210 Fax: 07 4666 3520
NORCO BOWDLERS – QUINALOW
3 Myall Street QUINALOW QLD 4403
Phone: 07 4692 1333
Thank you to our Norco
employees, Co-operative
members and customers
who feature in the annual
report photography.
Your time and participation
is greatly appreciated.

www.norco.com.au

Annual Report 2014

An Australian, farmer owned dairy co-operative since 1895