Verdesian NUEs, August 2021
A word from Kenny
WHAT A DIFFERENCE A YEAR MAKES. This time last year, we were in the grip of COVID-19. We could not visit customers, we could not hold meetings, and commodity prices were nearly half of what they are today. Today, we have a farm economy that is exploding and a global economy that is beginning to expand and recover. On top of that, we have a company with people and products executing at a high level delivering our best seven months in Verdesian history. In addition, we also have new owners. The acquisition of Cytozyme Laboratories, Inc., on March 31, and a host of new activity – from hiring sales and technical people, to investing in expanded trials of our products as well as investments in our plants – all leads to terrific momentum. The Cytozyme transaction expanded our products – as well as our presence – thanks to a group of outstanding people from all over the world.
On a personal note: September marks my five-year anniversary with Verdesian Life Sciences. And while the road has not always been smooth, straight or even visible on a couple of days, it has been a journey worth taking. I have never been more excited about our future than I am today. That excitement is not because we are doing well (that, of course, helps), but because I came to Verdesian to be part of a company that can make a difference in agriculture and in people’s lives. That reality has never been closer than it is today. You are making a difference around the globe, and with our new and innovative products we will continue to magnify that difference. Like I said at the National Sales Meeting, you need to buckle up because we are going to accelerate to reach our maximum potential.
Finally, while a lot has changed, some things, unfortunately, have not. COVID and its variants still exist around the world, and we will continue to deal with the unfortunate outcomes of this for the months and years to come. Having seen the impacts firsthand, I encourage each of our employees globally to get vaccinated. My family and I have both had Covid and we are vaccinated. Your health and safety are our utmost concern, and so I encourage you to stay safe and take care of yourself and your families.
We have four months left to finish the calendar year strong. Stay focused. Stay safe. Maximum effort leads to maximum returns. Thank you.
Did you know?
Did you know that we have a professional Cornhole player in our midst? That’s right, Account Manager Trevor Jones traveled the pro circuit for a few years as part of the American Cornhole League (ACL). Trevor’s accolades include many first place finishes at regional and local events, participating in the World Cup, and finishing in the top 16 in the Mid-Atlantic region. In total, Trevor has played in more than 600 world events. He even placed seventh in the world in doubles.
“I’ve taken a small break recently with my focus on Verdesian,” he said, “but still play regionally.”
Good luck, Trevor!
Operations Update: ‘You deliver the results’
GREETINGS FROM YOUR SUPPLY CHAIN, OPERATIONS AND CUSTOMER SERVICE TEAM! As we are in the agriculture market, it is only fitting that we begin with the weather and this year will be remembered for our perseverance over the challenges. Already it is the end of August and our heads reel at the speed and success of these first eight months of 2021. It seems like yesterday that our Cape Girardeau and Kentland plants were hitting record temperatures with frozen scenes from the North Pole, yet now many of us are suffering from record high temperatures. (Our Pasco plant may have “won” the record by hitting a temperature of 118, or perhaps higher.) I also believe every location has had smoke impacts from the devastating wildfires from out West.
There have been many outstanding accomplishments to highlight in this team, and I am proud to point out a few.
Appropriately, we start with our Environmental, Safety and Health areas. Achieving and maintaining regulatory compliance takes a daily commitment; across our operating locations, we have been especially busy. The pandemic continues, and our plants have maintained productivity and ensured our customers have products. We also face a uniquely challenging task with ocean, rail and truck logistics constrained in every direction and impacting the ability to bring raw materials in and to send product out. The Sourcing and Customer Service teams have shown amazing agility in keeping the lifeblood of the business moving.
Our commercial growth for Cytozyme and Specialty Micronutrients (way to go, team!) has created new challenges. We need more capacity, and we are very busy assembling the capital projects needed to support growth. These are big investment decisions, and next month we will go to the Board of Directors with the plans. Our Pasco and Salt Lake City plants have successively expanded capacity for Cytozyme products by producing in Pasco. Oh, yes: let us not forget about the business changes with the fiscal year shift and installing a new ERP system. These are major changes, too, and will shape how we work the business process going forward. All of us have a stake in making that successful.
I am so proud of the employees on our teams. We are managing our freedom to operate and deliver on the base commitments, we are growing the business, and are doing it with positive and respectful energy. The workplace definition is changing before our eyes and we have adapted to remain successful. Remote engagements of our customers, suppliers, tollers, and ourselves have been accepted – and we have delivered results. The IT platforms that enable it have thankfully kept right up with the needs. We have hired new employees in every function and at every level, and they are contributing greatly. It has been their dedication and perseverance that delivers our results. We brought Cytozyme Laboratories, Inc., into the Verdesian family, and they are an amazing team and have been great to join right into the organization.
Finally, thank YOU. I am thankful for each of your efforts and accomplishments. I’m thankful for health to you and your family. And it is about You. You make a decision every day to be safe, to work with integrity, to work with each other, and to create the winning culture. YOU apply your talents and skills to deliver the results.
North America Commercial Update: Change in fiscal year an opportunity to organize our business to better meet customer needs
VERDESIAN WILL BE CHANGING ITS FISCAL YEAR EFFECTIVE SEPTEMBER 1, 2021. The new fiscal year will run from September 1st through August 31st every year going forward. This may seem like a change that primarily affects our finance team and financial reporting; however, this change has several positive impacts on the broader organization.
First, this calendar aligns with our V.I.P. Platform program year. This also will allow for our Seed Treatment & Inoculants (ST&I) business to be phased more closely to consumption and elevate shipping and logistics pressure during December — the most busy shipping time of the year. Most importantly, this change will allow Verdesian to more closely align our business timing needs with that of our customers. The typical market year for crop inputs is September to August, so this change really helps us deliver on one of our key strategic pillars: Focus on the Customer.
From the CFO: ‘Thank yous’ all around”
I WOULD LIKE TO GIVE A BIG SHOUT OUT TO THE FINANCE, LEGAL AND IT TEAMS. They do a lot that is not always visible, although their work makes our lives at Verdesian run smoothly. Thank you to each and every member of these teams. It has been my pleasure to work with you for the past two and a half years!
The past six months have been busy for Kirsten Carlos, who was involved in the due diligence of Cytozyme and providing due diligence to AEA in the funding process. After Cytozyme was acquired, there have been many things which Legal has been involved with behind the scenes. Making sure the proper documentation is signed and filed in both transactions was key. Legal has also been involved in drafting distribution agreements, local agreements, toll manufacturing agreements, mutual confidentiality agreements, and material transfer agreements. Forty new patent applications have been filed this past quarter, while maintaining a trademark portfolio of 650+ trademarks. You will find Kirsten often answering emails at 3:30 in the morning! Your emails are important to Legal. Thanks for keeping them coming.
Ray Douglas leads by example and is involved in projects from improving cash flow reporting to coordinating the seemingly endless audit information requests. We welcomed the team from Salt Lake City on March 31: Ashley Archuleta, Zach Litchfield, Aspen Landgren and Ana Zavada. Sue Smith continues keeps us in good standing with the VAT man and all things EU! The Cary team completed an inventory audit for one of our lenders, while Jeanny Brown single-handedly collected 99 percent of the ST&I receivables due June 15 and a total of $21.5M for the month of June. Vickie Hall, Paula Flint, and CarLotta Mitchell have been busy adding more than 230 new vendors in 2021, while Don Kinsey tracks and records the reconciliations helping us to close the books on time. We are fortunate to have Carsyn Barnes interning with us now to help Jeanny and team out! Mark Burgin kept busy this year with the funds flow movement during two acquisitions, all while making sure payroll didn’t miss a beat!
Tim Miller is gracefully juggling complex tax issues that come with stub years, short years and new fiscal years. Incorporating the nuances that come with acquisition accounting, all while lining up the appropriate audits to match the challenges of changing the year end to August 31, working with Bryan to make sure our ERP’s can handle the switch and we can report to all of our constituents, both inside and outside of the company.
Prasad Naik and his team have been working hard building analytical resources for Verdesian. Anh McCormick has been busy creating all new reporting and board presentation formats requested by the AEA team in a short span of time. Additionally, she took the lead on building several of the Adaptive Insight dashboards and leading training to budget owners last month.
Julio Rosa and Bryan Smith consistently develop the sales forecasting tool by listening closely to pain points of the sales team and making consistent improvements to the tool in preparing for next budget year, including incorporating Cytozyme sales forecasting into the VLS forecasting tool, a big step that lays the foundation for better financial forecasting and S&OP process for Cytozyme.
Tim and Bryan worked tirelessly on integration of Cytozyme financial data. By making that data available in the Database, we were able to make strides in providing consolidated reporting on daily, monthly reports & financial insights to the organization. Next step is cleaning up the Cytozyme financial data into our budgeting and forecasting tool (Adaptive) for complete visibility across functions as we work on building budgets for the next fiscal year as single cohesive company.
Jesse Cooper led us through the transition to work-from-home, while keeping all our plants online and overcoming many obstacles along the way. He is now spearheading the ERP Selection Process and will continue to lead through implementation. The IT team grew this year with the addition of Scott Bishop in Salt Lake City and Brandon Chauvaux in Cary. The entire team worked hard to ensure a smooth transition of legacy Cytozyme email to Verdesian’s systems. Anderson Covington and Jesse met the Sales teams in Utah and issued new computers. In addition to continuing to enhance VLS Forecast Pro, Bryan is developing new functionality for the upcoming refresh of VLSNET. Brice Bowman deployed a data protection solution in Pasco and Cary called Rubrik that safeguards the company’s servers and data.
HR Update: Talented people make us go
THE HUMAN RESOURCES TEAM IS FOCUSING ON MANY INITIATIVES THIS FALL. With the growth of our company and brand, bringing in great talent continues to be priority for our organization. If you have someone you think would make a great teammate, please encourage them to apply. Get them hired and get a referral bonus! Referral Bonus Program/Form can be found on VLSNET > HR page and in UltiPro > My Company > Electronic Forms. Positions will be posted on the VLS website, intranet and the UltiPro portal (View Opportunities). For regular nonexempt positions, the referral bonus will be $250. For regular exempt positions, the referral bonus will be $750. For positions open more than two months, the referral bonus stated above will receive an additional 50 percent on top of the bonus. If you have questions, ask your HR Manager for details. We are excited to share how you can work with your friends and get paid.
You can expect to see a check-in survey as a follow up to our engagement survey earlier this summer. It’s quick and easy and we encourage everyone to participate. Let us know how we’re doing.
Finally, as the summer season winds down, flu season will be upon us. With the onset of the COVID Delta variant, we want everyone to stay safe and healthy. If you’ve not gotten your COVID vaccine, we strongly encourage you to do so. If you have questions or need help navigating locations for the vaccine, please reach out to HR.
Marketing Update: Creating a global NUE brand
IT HAS BEEN A GREAT SUMMER WITHIN THE VERDESIAN MARKETING GROUP. We were excited for the chance to gather with customers and staff in multiple settings, something we missed dearly after skipping a year of events due to Covid. We are “The Nutrient Use Efficiency People,” and so it’s great to be together once again. The purchase of Cytozyme has created additional opportunities for us to continue to scale the NUE message, and we are excited about all of the work being done to create a truly global NUE brand.
V.I.P. Summit: We welcomed more than 160 retail staff members, representing 71 different North American retailers, to Salt Lake City for our Second Annual V.I.P. Summit Amazing Race challenge. Thirty-four teams of participants competed across the Salt Lake City valley, completing more than 1,700 challenge tasks, varying from curling at the Olympic training facility to go-kart racing at top speeds. As one of our V.I.P. participants said, “I feel like I learned more this way, rather than sitting all day in a meeting.” Congratulations to Aaron Rogers and his team for winning the event this year. A recap of the event can be seen here:
MicroSync Cape Tour: One of the absolute best ways to sell MicroSync Granular Micronutrients is to show people where it is made. Once you have experienced a plant tour in Cape Girardeau, you see the warehouse full of MicroSync, and hear from the great staff about the high levels of product quality that is in place, it’s hard to not get excited about MicroSync. We welcomed 125 retail personnel over the course of a week to tour the plant in mid-August and catch a Cardinals baseball game. As always, the Cape team did an amazing job hosting the event.
Product Launch in India: Though we were not able to attend in person, we had the privilege to support RK Goyal and his team in the launch of six new products from Verdesian into the India market. Their team hosted a world-class event that outlined the vision for Verdesian in that region. There is incredible momentum and energy within this region, and we are eager to see RK and his team continue to provide value for farmers across India.
We are eager to continue to deliver the NUE message to growers across the globe. If you have any ideas, thoughts, or questions please feel free to reach out!