Livestock Improvement Corporation Limited/Announcement

Full Year Result 2021-22

Full Year Results20 July 2022LICFinancials

LIC is the trading name of Livestock Improvement Corporation Limited
MEDIA RELEASE
20 July 2022

LIC to deliver strong dividend to farmer shareholders as co-op continues to drive
value on-farm

LIC has today announced its financial result for the 2021-22 year, driven by increased farmer spend on
premium genetics and herd improvement services to breed more efficient cows with a lighter environmental
footprint.

Reporting a 15.3% increase in underlying earnings*, the farmer-owned co-operative will return $26.2 million in
dividend* to shareholders. This equates to 18.43 cents per share with a 18.5% gross yield on the current
share price. It will be paid on 19 August.

“The Board is pleased to present this result for our farmers, particularly after a year hampered by Covid-19,
inflationary pressures and supply challenges,” said Murray King, Board Chair.

“I want to thank our farmer shareholders for their ongoing support, many of whom faced similar challenges as
us. Delivering value for our farmers is at the centre of everything we do and it’s results like this that enable us
to do just that – through our herd improvement products and services, a solid dividend, and, importantly, the
right R&D investment to keep their herds profitable and sustainable into the future.”

Summary of financials*
• Total Revenue from Continuing Operations: $263.2 million (up 5.7%)
• Net Profit After Tax (NPAT): $26.7 million (up 16.5%)
• Underlying Earnings: $25.7 million (up 15.3%)
• Strong balance sheet, no debt at year-end and total assets $385.6 million (up 1.2%)
• Dividend: $26.2 million, or 18.43 cents per share
• R&D investment: $18.2 million or 6.9% of revenue (up 6.2% from $17.1 million)
*Refer notes to financial information

King said the result was driven by more farmers opting for the co-op’s premium bull teams to breed high
genetic merit cows which produce more milk, more efficiently – resulting in a lower environmental footprint per
kilogram of milk solid produced.

“The dairy industry needs to keep evolving to meet the challenges posed by climate change. Consumers
expect a more sustainable approach to farming and this result reaffirms our farmers are well dialled into this.

“The production efficiency of every cow in our national dairy herd has never been more important; farmers
know that all cows aren’t created equal and they are investing in solutions to breed the best cows, faster.

“These breeding decisions will serve them well into the future to build a more profitable and sustainable dairy
sector and meet climate goals.”

During the 2021-22 year, 71% of fresh semen straws used for breeding replacements were from LIC’s
premium bull teams (2.1 million straws), up from 60% the year prior (1.8 million straws). These teams utilise
younger bulls, selected using genomic DNA technology so they can be made available to farmers earlier and
fast track the rate of genetic gain on-farm.

King said the co-op has invested heavily into genomics over the last 30 years and new research has
confirmed farmers are reaping the rewards of this now.

“Long term users of LIC genetics have almost doubled the speed of improvement in their herds over the last
decade. They are not only breeding genetically superior cows which are more emissions efficient, they’re also
breeding them at a much faster rate and genomics is the key contributor to this.

Page 2 of 2
“We don’t need to milk more cows, we just need to milk the best cows and we’re really pleased that our
farmers are making solid progress in this space.”

In other business activity, orders for sexed semen almost doubled from the previous year, exceeding 200,000
straws for the first time. International exports also saw an increased demand for sexed semen, while overall
straws numbers sent offshore remained steady on the year prior.

DNA verification tests increased (up 15%), as did LIC’s range of animal health tests (up 21%), with a notable
increase in Johne’s disease testing with close to one million samples tested (up 28%). The number of animals
recorded in MINDA, LIC’s herd management system, also remained steady, as did herd testing with a modest
increase in total samples processed, however more farmers are using the co-op’s EZ Link devices to help
simplify and speed up the herd testing process (up 4%).

During the year the co-op invested $18.2 million into R&D, up from $17.1 million the year prior, maintaining its
position as one of the largest private investors in R&D at 6.9% of revenue.

A large proportion of this investment was directed to the co-op’s large-scale methane trial, with CRV and
funding support from the New Zealand Agricultural Greenhouse Gas Research Centre, which is aimed at
discovering a genetic link for methane production to ultimately enable farmers to breed cows that emit less
methane.

King said the trial has been measuring feed intake and methane emissions from 300 young bulls and results
from this phase are expected to be released later this year.

Other key events during the year included the completion of the sale of the automation business to MSD
Animal Health, which then resulted in the co-op’s first special dividend payment to partially distribute the sale
funds, and the appointment of a new Chief Executive, David Chin, who took over the reins in January.

Outlook
The co-op expects underlying earnings* in 2022-23 to be in the range of $20-26 million, assuming no
significant climate event or milk price change takes place between now and then, nor any major impacts from
M. bovis or Covid-19.

King said a key focus for the year ahead remains on delivering to the three commitments in the co-op’s
strategy - operational excellence, faster genetic improvement and software reliability and performance. The
co-op’s performance against these commitments during the 2021-22 year will be reported on at its Annual
Meeting in October.

Ends
This statement has been authorised for release by the Board of Directors.
Contact:
• For shareholder enquiries, contact the Share Registry team on shareregistry@lic.co.nz or phone 0800 542 742
• For media enquiries, contact: Aleisha Williams, 0275711702

Notes to financial information*
These annual results include the annual non-cash revaluations of LIC’s major biological asset, the bull team, and the outstanding Nil Paid
Ordinary Shares receivable, which are both required to reflect “fair value” under accounting standards. Figures have been audited. These
numbers should be all read in conjunction with the financial accounts.
• Underlying Earnings: This is LIC’s NPAT excluding bull valuation, nil paid share valuation movements and the one-off gain on
divestment of Automation and is considered useful to investors as it is the basis on which LIC has historically reported and
determination of dividends. Non-GAAP financial information does not have a standardised meaning prescribed by GAAP and therefore
may not be comparable to similar financial information presented by other entities.
• Discontinued operations: LIC completed the divestment of its automation business in 2021-22. Accounting standards require profits
from the Automation business results to be separately disclosed as Discontinued Operations.
• Nil Paid Ordinary Shares: These were issued to shareholders in 2018 as part of the share simplification process which brought
together LIC’s two previous classes of shares into one Ordinary Share. For each co-operative share held, one Fully Paid Ordinary
Share and three Nil Paid Ordinary Shares were issued. Nil Paid Ordinary Shares carry the same rights to dividends and voting as
Ordinary Shares but cannot be traded on the NZX until they are fully paid up. Dividends paid on remaining Nil Paid Shares are
automatically retained by LIC to pay down the remaining unpaid shares. LIC records an estimate of the fair value of the outstanding Nil
Paid Ordinary Shares receivable at balance date.
• Bull team valuation: The annual non-cash revaluation of the co-op’s largest biological asset was $93.1 million. This is down from
$114.8 million the previous year, mainly due to the increasing number of the younger, genomically-selected bulls which are superseded
earlier so used for a shorter period and therefore have a reduced value, as well as the impact of increasing interest rates on the value
of future revenue and costs. The valuation is based on an independent model that looks at future revenue streams and costs
associated with the current bulls owned, discounted back to current value.
• Dividend: The fully imputed dividend represents 80% of underlying earnings, consistent with previous years, but also includes an
additional $5.7m to recognise the portion of cash dividends on Nil Paid Shares in 2021-22 that had been retained to pay down unpaid
shares.

---

There's always room for improvement
Livestock Improvement
Corporation Limited (LIC)
Annual Report
For the year ended 31 May 2022

2 Livestock Improvement Corporation Consolidated Annual Report 2021/22

Contents
Key results and position 4
Our results for the year 4
Our position at year end 5
Our cash flows for the year 6
Changes in our position for the year 7
More details 8
Accounting policies 8
Business analysis 9
Our core assets 10
Our funding 14
Risk and other assets 15
Tax and other expenses 16
Other liabilities, transactions with related
parties, cash flow reconciliation 17
Discontinued operations 18
Subsequent events 19
Independent auditor's report 20
Directors' report 24
Corporate Governance report 26

Key results and position
STATEMENT OF RESULTS FOR THE YEAR
For the year ended 31 May 2022
in thousands of New Zealand dollars
Note20222021
Continuing operations
Revenue1263,182 249,013
Purchased materials(44,561)(40,795)
People costs(108,969)(103,576)
Depreciation and amortisation3,4,5(22,749)(21,999)
Research and development(18,184)(17,124)
Other expenses10(35,347)(33,615)
Net finance costs(277)(1,376)
Bull team revaluation2(21,674)(718)
Fair value change in Nil Paid Share receivable61,202 1,200
Profit/(loss) before tax expense from continuing operations12,623 31,010
Tax expense9(2,000)(7,397)
Profit/(loss) for the year from continuing operations10,623 23,613
Discontinued operations
Profit/(loss) after tax expense from discontinued operations1416,100 (669)
Profit/(loss) for the year26,723 22,944
Hedge revaluations6124 (134)
Investment revaluations6(5)(195)
Land and buildings revaluations3,64,756 1,443
4,875 1,114
Comprehensive income for the year 31,598 24,058
Profit from continuing operations per Ordinary Share (excl. treasury stock) $0.07 $0.17
Profit per Ordinary Share (excl. treasury stock) $0.19 $0.16
Supplementary non-GAAP note to the results for the year:
Profit/(loss) for the year26,723 22,944
Plus: Bull team revaluation21,674 718
Tax effect on Bull team revaluation(6,069)(201)
Less: Gain on divestment of Automation business14(15,449)-
Less: Fair value change in Nil Paid Share receivable(1,202)(1,200)
Underlying earnings25,677 22,261
Underlying earnings per Ordinary Share (excl. treasury stock) $0.18 $0.16
4 Livestock Improvement Corporation Consolidated Annual Report 2021/22

Key results and position

STATEMENT OF POSITION FOR THE YEAR
As at 31 May 2022
In thousands of New Zealand dollars
Note20222021
Cash1464,135 18,821
Debtors848,190 42,973
Assets held for sale14- 26,471
Other assets826,484 25,042
Nil Paid Shares receivable68,651 13,491
Bull team293,116 114,790
Land, buildings and equipment - owned & leased3,5106,426 95,114
Software, goodwill and other intangible assets438,608 44,425
Total assets385,610 381,127
Creditors7,1428,612 24,541
Liabilities held for sale14- 2,656
Borrowings7- -
Deferred tax926,262 31,935
Other liabilities1137,679 28,750
Total liabilities92,553 87,882
Net assets293,057 293,245
Share capital676,737 76,737
Retained earnings6169,624 174,687
Other reserves646,696 41,821
Total equity293,057 293,245
Director
Date: 20 July 2022
Director
Date: 20 July 2022
Livestock Improvement Corporation Consolidated Annual Report 2021/22 5

Key results and position
STATEMENT OF CASH FLOW FOR THE YEAR
For the year ended 31 May 2022
In thousands of New Zealand dollars
Note20222021
Customer receipts1261,249 254,989
Supplier payments(206,181)(200,765)
Net tax payments2,125 (13,477)
Other operating cash flows(63)(291)
Net operating cash flows1357,130 40,456
Software development4(6,580)(7,658)
Net sales/(purchases) of land, buildings and equipment3(10,570)(7,845)
Sale of net assets held for sale1435,571 -
Other investment cash flows(739)(612)
Net investment cash flows17,682 (16,115)
Payment of principal portion of lease liabilities(3,597)(3,460)
Drawdown/(repayment) of borrowings- (1,616)
Investment Share repurchases- (1,695)
Nil Paid Share receipts352 352
Dividends paid(26,363)(15,398)
Net financing cash flows(29,608)(21,817)
Movement in cash for year45,204 2,524
Cash at beginning of the year18,821 16,488
Currency movement on cash holdings110 (191)
Cash at end of the year64,135 18,821
6 Livestock Improvement Corporation Consolidated Annual Report 2021/22

In thousands of New Zealand dollarsNoteShare capitalRetained earningsOther reserves Total equity
Balance at 1 June 202176,737 174,687 41,821 293,245
Profit/(loss) for the year- 26,723 - 26,723
Dividends paid- (32,052)- (32,052)
Hedge revaluations- - 124 124
Investment revaluations- - (5)(5)
Land and buildings revaluations3, 6- - 4,756 4,756
Adjustments on divestment- 266 - 266
Balance at 31 May 202276,737 169,624 46,696 293,057
Balance at 1 June 2020 as previously reported78,432 170,720 41,090 290,242
Impact of SAAS accounting policy change
Accounting
policies (v)
- (878)- (878)
Restated balance78,432 169,842 41,090 289,364
Profit/(loss) for the year- 22,944 - 22,944
Dividends paid- (18,156)(326)(18,482)
Hedge revaluations- - (134)(134)
Investment revaluations- - (195)(195)
Land and buildings revaluations3, 6- - 1,443 1,443
Acquisition of minority interest in subsidiary- 57 (57)-
Investment share repurchases(1,695)- - (1,695)
Balance at 31 May 202176,737 174,687 41,821 293,245
Key results and position

STATEMENT OF CHANGES IN POSITION FOR THE YEAR
For the year ended 31 May 2022
Livestock Improvement Corporation Consolidated Annual Report 2021/22 7

These financial statements set out the performance, position
and cash flows of Livestock Improvement Corporation Limited
(""LIC"" or the ""Company"") and its subsidiaries (the ""Group"")
for the year ended 31 May 2022.
LIC is domiciled in New Zealand, registered under the
Companies Act 1993 and the Co-operative Companies Act
1996, and listed on the Main Board of NZX Ltd. LIC is an FMC
Reporting Entity for the purposes of the Financial Reporting Act
2013 and the Financial Markets Conduct Act 2013.
Basis of Preparation
i. Statement of compliance
These financial statements comply with NZ GAAP as
appropriate for Tier 1, for-profit entities, NZIFRS and IFRS.

ii. Basis of measurement
The financial statements have been prepared on a GST
exclusive basis, with the exception of trade receivables and
trade payables, which are reported inclusive of GST.

The majority of the Group's business does not follow a
clearly identifiable operating cycle, therefore the balance
sheet is presented in order of liquidity as it is more relevant
to the users of the financial statements.
iii. Functional and presentation currency
The functional currency of the Company and the
presentation currency of the financial statements is New
Zealand Dollars ("NZD"), with amounts rounded to the
nearest thousand.
iv. Use of estimates and judgements
The key estimations and judgements made in preparing
these financial statements are the valuation of the Bull
team and the impairment testing of software and other
intangible assets.
v. New or amended standards adopted in current year and
standards issued but not yet effective
These financial statements reflect the impact of the IFRS
Interpretation Committee's decisions on accounting
for software-as-a-service (SAAS) arrangements, which
reduced retained earnings and software intangible assets
by $0.878 million as at 1 June 2020 and 31 May 2021. In all
other respects, accounting policies have been applied
consistently with prior periods.
Accounting policies
Accounting entity
8 Livestock Improvement Corporation Consolidated Annual Report 2021/22

(i) Operating segments
The Group operates in four key operating segments and across four key geographies as set out below. Figures in the following tables
reflect information regularly reported to the Chief Executive on those key operating segments:
• NZ market genetics: provides bovine genetic breeding material and related services, predominately to dairy farmers.
• Herd testing: herd testing and animal recording for pastoral farmers.
• Farm software: data recording, tags and farm management information services.
• Diagnostics: provides DNA and animal health testing services.
NZ Market Genetics revenue is primarily recognised at a point in time, upon delivery of product to the customer. All other revenue lines
are primarily recognised over time, as the service to the customer is provided.
In thousands of New Zealand dollars
2022
NZ market
genetics
Herd
testing
Farm
software
DiagnosticsOtherEliminationsTotal
External revenue104,621 36,803 51,548 26,881 43,329 - 263,182
Inter-segment revenue- - - - 4,281 (4,281)-
Total revenue104,621 36,803 51,548 26,881 47,610 (4,281)263,182
Depreciation & amortisation(1,228)(5,606)(2,279)(3,297)(10,339)- (22,749)
Segment gross profit before tax69,091 19,874 38,439 10,682 18,542 - 156,628
Bull team revaluation(21,674)
Unallocated amounts(122,331)
Profit/(loss) before tax expense from continuing operations12,623
2021
NZ market
genetics
Herd
testing
Farm
software
DiagnosticsOtherEliminationsTotal
External revenue99,256 35,397 50,810 23,331 40,219 - 249,013
Inter-segment revenue- - - - 4,026 (4,026)-
Total revenue99,256 35,397 50,810 23,331 44,245 (4,026)249,013
Depreciation & amortisation(1,059)(5,308)(3,591)(1,124)(10,917)- (21,999)
Segment gross profit before tax65,720 20,101 36,607 10,597 16,494 - 149,519
Bull team revaluation(718)
Unallocated amounts(117,791)
Profit/(loss) before tax expense from continuing operations31,010
The Other segment includes international operations, research & development and support services. Unallocated amounts include
personnel costs, other expenses and net finance costs.
Notes to the Financial Statements
1. Business analysis
Livestock Improvement Corporation Consolidated Annual Report 2021/22 9

Key drivers of the model:
Percentage of genomic bulls still in the team from 2-4 years46-13%59-13%
Forecasted Fonterra Farmgate Milk Price* $7.50 - $9.60$6.60 - $7.20
WACC annualised post tax rate7.03% - 7.94%5.16% - 7.20%
Number of bulls in the team136136
* This is the long term to short term Milk Price outlook
(ii) Geographic analysis
In thousands of New Zealand dollars
2022
New ZealandAustraliaIrelandUnited KingdomOtherTotal
Revenues242,308 9,494 2,548 3,501 5,331 263,182
Non-current assets245,406 5,614 907 8,135 - 260,062
2021
Revenues229,173 9,115 2,346 3,433 4,946 249,013
Non-current assets267,136 5,582 563 8,274 - 281,555
2. Bull Team
The bull team is the cornerstone asset of LIC's genetics business. The 967 total bulls (2021: 938 bulls) from which the bull team are
selected are carried at their fair value, which is based on LIC's modelling of future cash flows from the bulls (a "Level 3 valuation").
Changes in their fair value are reported in profit. The fair value from the bulls is partly dependent on the future sales mix of LIC's
genetics products, which is historically strongly correlated to the Farmgate Milk Price paid by Fonterra Co-operative Group. The
valuation is also sensitive to a change in the WACC rate used to discount future cash flows and the run off profile of bulls that
make up the bull team.
Non-current assets includes the Bull team, Land, buildings & equipment, Software, goodwill and other intangible assets, Nil Paid Share
receivable and investments.
The Group's significant subsidiaries are:
• New Zealand: LIC Agritechnology Company Limited (100%)
• Australia: Livestock Improvement Pty Ltd (100%), Beacon Automation Pty Ltd (100%)
• Ireland: LIC Ireland Limited (100%)
• United Kingdom: Livestock Improvement Corporation (UK) Ltd (100%)
The Group is not dependent on any one major customer in any of its reportable segments. New Zealand revenues include government
grant and R&D tax incentives income of $9.820 million (2021: $7.273 million).
In thousands of New Zealand dollars
20222021
Opening balance114,790 115,508
Bull team revaluation(21,674)(718)
Closing balance93,116 114,790
The impact on the fair value of a change to these key drivers is summarised below:
20222021
Genomic run off profile $5.8m - average of 12% shift across years 2 & 3
Impact on demand incorporating effect of reducing the 2022 forecast
Farmgate Milk Price by $1.25 in the short term and $0.25c in the long term
$10.8m$14.2m
WACC moves 100 basis points$2.5m$3.6m
Notes to the Financial Statements
1. Business analysis (cont.)
10 Livestock Improvement Corporation Consolidated Annual Report 2021/22

In thousands of New Zealand dollars
20222021
Land BuildingsEquipmentTotalLand BuildingsEquipmentTotal
Opening balance35,755 38,870 20,489 95,114 34,265 39,172 21,957 95,394
Additions- 2,507 8,081 10,588 - 3,755 4,741 8,496
Disposals- (5)(147)(152)- (57)(240)(297)
Depreciation- (2,133)(6,228)(8,361)- (1,930)(6,040)(7,970)
Revaluation2,337 3,358 - 5,695 1,490 (238)- 1,252
Foreign exchange- 8 21 29 - (10)(19)(29)
Leased assets movement - note 5- 3,296 217 3,513 - (947)758 (189)
Held for sale - note 14- - - - - (875)(668)(1,543)
Closing balance38,092 45,901 22,433 106,426 35,755 38,870 20,489 95,114
Value if carried at cost11,691 21,399 N/A 11,691 21,030 N/A
Estimated useful lives N/A 10-60 years 3-10 years N/A 10-60 years 3-10 years
Land and buildings are carried at fair value, determined by an independent valuer every year with a desktop valuation at April 2022
(most recent full valuation as at April 2021). Fair value is based on comparable sales for land and based on depreciated replacement
cost for buildings. Revaluations are reflected in the revaluation reserve. Equipment includes plant, vehicles, furniture and fittings and
IT hardware, and is carried at depreciated cost. Buildings and equipment are depreciated on a straight-line basis over their estimated
useful lives, and are reviewed annually for any indications of impairment.
4. Software and other intangibles
(i) Software and other intangible asset balances
Software development expenditure is capitalised only where costs are directly attributable, and once the product or process is
commercially feasible, the benefits are probable, and the Group intends to sell or use the completed software.
Software assets are amortised over their useful lives of up to seven years on a straight line basis, and are reviewed annually for
indicators of impairment.
Intellectual property (IP) assets are amortised over their estimated useful lives of up to 13 years.
The genetic data in the LIC database increases with each successive generation. Both goodwill and the LIC database have indefinite
useful lives. They are recognised at cost and are not amortised, are allocated to a cash generating unit ("CGU") and tested for
impairment annually.
Notes to the Financial Statements
3. Land, buildings and equipment
In thousands of New Zealand dollars
20222021
Software &IP GoodwillDatabaseTotalSoftware &IP GoodwillDatabaseTotal
Opening balance31,595 2,330 10,500 44,425 49,932 6,500 10,500 66,932
Additions6,501 - - 6,501 7,750 - - 7,750
Disposals/impairment(2,278)- - (2,278)(3,260)- - (3,260)
Amortisation(10,220)- - (10,220)(14,194)- - (14,194)
Foreign exchange162 18 - 180 (64)(26)- (90)
Held for sale - note 14- - - - (8,569)(4,144)- (12,713)
Closing balance25,760 2,348 10,500 38,608 31,595 2,330 10,500 44,425
Livestock Improvement Corporation Consolidated Annual Report 2021/22 11

In thousands of New Zealand dollars
20222021
Farm software
and herd
testing CGU
Farm
automation
CGU
Other CGUTotal
Farm software
and herd
testing CGU
Farm
automation
CGU
Other CGUTotal
LIC database10,500 - - 10,500 10,500 - - 10,500
Goodwill- - 2,348 2,348 - 4,144 2,330 6,474
Held for sale - note 14- - - - - (4,144)- (4,144)
10,500 - 2,348 12,848 10,500 - 2,330 12,830
At reporting date, software includes $9.513 million (2021: $18.155 million) of work in progress, which is not being amortised until it is
ready for use.
(ii) Impairment testing of intangible assets
Allocation of Goodwill and the LIC Database to CGUs:
The LIC database and Other CGU Goodwill recoverable amounts have been determined using value in use.
For the LIC database and Other CGU Goodwill, a discounted cash flow model is used for impairment testing based on expected
results and capital expenditure from the current year forecast, Board approved budgets and a projection for further periods using
a terminal growth rate. A five year cash flow projection period is used. The terminal growth rate used is 0-1.0% (2021: 0-1.0%) for the
LIC database and Other CGU Goodwill. The discount rate applied is reviewed and updated annually for movements in published
Treasury risk-free rates and is 8.0% for the LIC database and Other CGU Goodwill, (2021: 7.2% for the LIC database and 7.2-10.4%
for Other CGU Goodwill).
Notes to the Financial Statements
4. Software and other intangibles (cont.)
(i) LIC as a lessee
The Group has lease contracts for buildings, equipment and vehicles used in its operations. The Group’s obligations under its leases
are secured by the lessor’s title to the leased assets. Several lease contracts include extension and termination options. The Group's
discount or incremental borrowing rate applicable to leases is 4.4% (2021: 4.4%).

The Group also has certain leases of machinery with lease terms of 12-months or less and leases of office equipment with low value.
The Group applies the ‘short-term lease’ and ‘lease of low-value assets’ recognition exemptions for these leases.
5. Leases
12 Livestock Improvement Corporation Consolidated Annual Report 2021/22

Lease liabilities
Set out below are the carrying amounts of lease liabilities recognised at 31 May 2022 (included in Other liabilities) excluding lease
liabilities held for sale:
The Group had total non-variable cash outflows for leases of $4.492 million in 2022 ($4.230 million in 2021).
(iii) Lease related amounts in the Statement of Results
(ii) Lease balances in the Statement of Position
Right of use assets
Set out below are the carrying amounts of right-of-use assets recognised (under Land, buildings and equipment) and the movements
during the period:
In thousands of New Zealand dollars
20222021
Buildings EquipmentVehiclesTotalBuildings EquipmentVehiclesTotal
Opening Balance7,533 185 5,868 13,586 9,354 365 5,211 14,930
Depreciation(1,233)(166)(2,362)(3,761)(1,271)(186)(1,928)(3,385)
Additions4,529 249 2,461 7,239 414 - 2,935 3,349
Adjustments/Derecognition- 5 30 35 (90)14 (77)(153)
Held for sale - note 14- - - - (874)(8)(273)(1,155)
Closing balance10,829 273 5,997 17,099 7,533 185 5,868 13,586
Lease terms 2-20 years 2-5 years 3-7 years 2-10 years 2-5 years 3-7 years
Notes to the Financial Statements
5. Leases (cont.)
In thousands of New Zealand dollars
20222021
Buildings EquipmentVehiclesTotalBuildings EquipmentVehiclesTotal
Within 1 year1,191 138 2,113 3,442 956 101 1,916 2,973
Between 1 to 5 years3,788 22 4,081 7,891 3,365 46 3,992 7,403
More than 5 years6,706 - 34 6,740 3,873 - 182 4,055
11,685 160 6,228 18,073 8,194 147 6,090 14,431
In thousands of New Zealand dollars
20222021
Buildings EquipmentVehiclesTotalBuildings EquipmentVehiclesTotal
Depreciation1,233 166 2,362 3,761 1,271 186 1,928 3,385
Interest expense403 8 295 706 350 9 254 613
Variable lease payments- - 1,274 1,274 - - 1,117 1,117
Short-term and low-value leases- 67 - 67 - 75 - 75
Total amount 1,636 241 3,931 5,808 1,621 270 3,299 5,190
Livestock Improvement Corporation Consolidated Annual Report 2021/22 13

The Group's funding comes from Share capital, retained earnings, other reserves and borrowings.
(i) Ordinary Shares
All Ordinary Shares have voting rights and the right to receive dividends based on the profits of the Company.
At reporting date there were 142,344,836 Ordinary Shares on issue, excluding 5,337,584 shares held as treasury stock
(2021: 142,344,836 Ordinary Shares, excluding 5,337,584 shares held as treasury stock).
(ii) Nil Paid Shares
Ordinary Shares includes both fully paid shares and shares on which full payment has not yet been made. These Nil Paid Shares must
be paid up over time by Shareholders via a combination of dividend payments forgone, voluntary payments and payments made
on exit as a Shareholder. At year-end the outstanding amount on Nil Paid Shares has been recorded in the Statement of Position
as a receivable, valued at $8.651 million (2021: $13.491 million) using a discounted cash flow model. The model uses assumptions on
expected future dividends, voluntary and compulsory payments and applies a discount rate of 5.0% (2021: 4.5%).
(iv) Bank debt
Bank loans are secured by a Negative Pledge granted to Westpac and Rabobank over certain New Zealand-based subsidiaries.
Notes to the Financial Statements
6. Funding
(iii) Other reserves and equity

In thousands of New Zealand dollars
Hedge
revaluation
reserve
Investment
revaluation
reserve
Land & building
revaluation reserve
Non-controlling
interests
Other
reserves
Balance at 1 June 2021(66)4,863 37,024 - 41,821
Profit/(loss) for the year- - - -
-
Dividends paid- - - - -
Revaluations124 (5)4,756 - 4,875
Acquisition of minority interest in subsidiary- - - - -
Balance at 31 May 202258 4,858 41,780 - 46,696
Balance at 1 June 202068 5,058 35,581 383 41,090
Profit/(loss) for the year- - - - -
Dividends paid- - - (326)(326)
Revaluations(134)(195)1,443 - 1,114
Acquisition of minority interest in subsidiary---(57)(57)
Balance at 31 May 2021(66)4,863 37,024 - 41,821
14 Livestock Improvement Corporation Consolidated Annual Report 2021/22

(i) Debtors
Bad debts of $0.029 million have been expensed during the year (2021: $0.070 million), and 98% of trade receivables are not past
due (2021: 90%).
(ii) Interest rate risk
Interest rate risk is the risk that changes in interest rates will impact the Group's results or position. The weighted average effective
interest rate paid on borrowings in 2022 was 3.2% (2021: 3.8%). A 1.0% increase in interest rates would increase interest paid and reduce
profit after tax by approximately $0.003 million (2021: $0.087 million).
(i) Liquidity risk
Liquidity risk is the risk of having insufficient liquid assets to pay the Group's debts as they fall due. The Group manages the risk
by monitoring forecast cash flows and holding sufficient bank facilities to meet the Group's needs. The contractual maturity of the
Group's funding is shown below.
The Group has bank funding facilities in place until February 2023 and expects to be able to meet any obligations which fall due.
Notes to the Financial Statements
7. Liquidity and interest rate risk
In thousands of New Zealand dollars20222021
Demand to
6 months
6 months
to 1 year
1 year
plus
Total
Demand to
6 months
6 months
to 1 year
1 year
plus
Total
Borrowings- - - - - - - -
Creditors28,612 - - 28,612 24,541 - - 24,541
28,612 - - 28,612 24,541 - - 24,541
(ii) Other assets
Inventories utilised and expensed during the period amounted to $27.567 million (2021: $30.053 million, of which $7.126 million related
to discontinued operations). Inventories written off in 2022 totalled $0.684 million (2021: $0.478 million).
Investments are non-current assets and are held at fair values based on available share prices and other market information. Gains
and losses are recognised in other comprehensive income, as investments are not held for trading. Significant investments include
National Milk Records PLC $7.975 million (2021: $8.072 million) and Figured Limited $3.999 million (2021: $3.999 million).
In thousands of New Zealand dollars
20222021
Inventories12,368 11,038
Investments13,261 13,329
Derivatives used for hedging51 -
Other livestock804 675
26,484 25,042
8. Debtors and other assets
Livestock Improvement Corporation Consolidated Annual Report 2021/22 15

Notes to the Financial Statements
9. Tax
Tax expense is recognised for items arising this year that are either taxable this year (current tax) or in other years (deferred tax).
The main items giving rise to deferred tax are revaluations of the Bull team and Buildings.
(i) Tax expense
LIC has transitioned to the R&D Tax Incentive from the Callaghan Growth Grant. The R&D Tax Incentive scheme includes both core R&D
expenditure, as well as other expenses that support R&D, and is recorded as non-taxable revenue.
In thousands of New Zealand dollars
20222021
Profit/(loss) for the year from continuing operations10,623 23,613
Tax expense2,000 7,397
Profit/(loss) before tax expense from continuing operations12,623 31,010
Tax at 28% NZ company tax rate3,534 8,683
Effect of overseas income(156)31
Non-deductible items(1,563)(1,582)
Adjustments from prior periods185 265
Tax expense2,000 7,397
Current tax expense8,612 9,987
Deferred tax expense(6,612)(2,590)
Imputation credits available16,68727,181
In thousands of
New Zealand dollars
As at
31 May 2022
Through
Profit/(loss)
Through
Other reserves
As at
31 May 2021
Through
Profit/(loss)
Through
Other reserves
As at
31 May 2020
Bull team & livestock25,667 (6,117)- 31,784 (199)- 31,983
Buildings & equipment
1,308 147 939 222 (986)(18)1,226
Intangible assets
1,460 (569)- 2,029 (911)- 2,940
Other
(2,173)(73)- (2,100)(494)- (1,606)
Total26,262 (6,612)939 31,935 (2,590)(18)34,543
10. Other expenses
Other expenses includes the following amounts paid to the Group's auditors, KPMG:
In thousands of New Zealand dollars20222021
Audit of the financial statements
196 216
Tax - compliance services for R&D Tax Credits
287 204
Other assurance work
- -
483 420
(ii) Deferred tax liability
16 Livestock Improvement Corporation Consolidated Annual Report 2021/22

Notes to the Financial Statements
11. Other liabilities
The provision for sire proving rebate represents a rolling three years of expected rebate payments, with approximately $1 million due
to be paid in each of the next three years, discounted to 31 May 2022.
13. Reconciliation of the Profit/(loss) for the year to Net operating cash flows
In thousands of New Zealand dollars
20222021
Provisions for employee entitlements7,521 7,899
Provision for sire proving rebate2,599 2,670
Provision for tax8,910 3,214
Lease liabilities - current3,442 2,973
Lease liabilities - non-current14,631 11,458
Other576 536
37,679 28,750
In thousands of New Zealand dollars
20222021
Profit/(loss) for the year26,723 22,944
Adjusted for:
Depreciation and amortisation on owned assets18,581 22,164
Bull team revaluation21,674 718
Lease liability principal repayment (classified as financing activity)(3,597)(3,460)
Working capital movements and other non-cash items(6,251)(1,910)
Net operating cash flows57,130 40,456
Directors of the Company and their related entities hold 294,950 Ordinary Shares, representing 0.20% of shares on issue (2021: 285,426
Ordinary Shares, representing 0.19%).
There are no loans or deposits with related entities outside of the consolidated Group.
12. Transactions with Related Parties - Directors and Management
The Group has had the following short-term transactions with key Management and Directors during the year:
In thousands of New Zealand dollars
20222021
Remuneration of key Management and Directors 5,280 4,573
Sale of goods and services to key Management and Directors512 598
Purchases of goods and services from key Management and Directors274 213
Livestock Improvement Corporation Consolidated Annual Report 2021/22 17

Notes to the Financial Statements
14. Discontinued operations
On 8 June 2021, LIC announced it had entered into an agreement to divest its automation business for $38.1 million (with $3.8 million
held in escrow until June 2023 and the remainder paid in cash), subject to customary requirements.
The transaction was completed on 11 June 2021. LIC is providing transitional services to the purchaser until they have fully established
operations.
The results for discontinued operations are presented below:
The major classes of assets and liabilities classified as held for sale at 31 May 2021 were as follows:
Total gain on sale of net assets of $15.449 million arose from the sales price of $38.1 million plus agreed working capital adjustments of
$1.164 million, less value of net assets held for sale of $23.815 million.
In thousands of New Zealand dollars
2021
Assets
Debtors8,973
Other assets3,242
Land, buildings and equipment - owned & leased1,543
Software, goodwill and other intangible assets12,713
Total assets held for sale26,471
Liabilities
Creditors1,289
Other liabilities1,367
Total liabilities held for sale2,656
Net assets held for sale23,815
In thousands of New Zealand dollars
20222021
Revenue1,052 17,399
Purchased materials(264)(6,693)
People costs(94)(4,453)
Depreciation and amortisation- (3,551)
Research and development- (716)
Other expenses(626)(3,014)
Gain on sale of net assets15,449 -
Net finance costs232 99
Profit/(loss) before tax expense from discontinued operations15,749 (929)
Tax expense351 260
Profit/(loss) for the year from discontinued operations16,100(669)
Profit from discontinued operations per Ordinary Share (excl. treasury stock) $0.110 $-
Cash and Creditors in the 2022 Statement of Position include $3.005 million for balances held in LIC bank accounts on behalf of the
purchaser of LIC's Automation business.
18 Livestock Improvement Corporation Consolidated Annual Report 2021/22

15. Subsequent events
After 31 May 2022, a dividend of 18.43 cents per Ordinary Share was proposed by the Directors in relation to the 2022 year, or $26.232
million (2021: 12.51 cents per Ordinary Share, or $17.808 million).
The net cash flows arising from discontinued operations are presented below:
In thousands of New Zealand dollars
20222021
Operating956 1,094
Investing35,571 (708)
Financing- 150
Movement in cash for the year36,527 536
Notes to the Financial Statements
14. Discontinued operations (cont.)
Livestock Improvement Corporation Consolidated Annual Report 2021/22 19

Independent Auditor’s Report
To the shareholders of Livestock Improvement Corporation Limited
Report on the audit of the consolidated financial statements
Opinion
In our opinion, the consolidated financial statements
of Livestock Improvement Corporation Limited (the
’Company’) and its subsidiaries (the 'Group') on pages
4 to 19:
i. Present fairly in all material respects the Group’s
financial position as at 31 May 2022 and its
financial performance and cash flows for the year
ended on that date in accordance with New
Zealand Equivalents to International Financial
Reporting Standards and International Financial
Reporting Standards.
We have audited the accompanying consolidated
financial statements which comprise:
— The consolidated statement of position as at
31 May 2022;
— The consolidated statements of results,
changes in position and cash flows for the
year then ended; and
— Notes, including a summary of significant
accounting policies and other explanatory
information.
Basis for opinion
We conducted our audit in accordance with International Standards on Auditing (New Zealand) (‘ISAs (NZ)’). We
believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
We are independent of the Group in accordance with Professional and Ethical Standard 1 International Code of
Ethics for Assurance Practitioners (Including International Independence Standards) (New Zealand) issued by the
New Zealand Auditing and Assurance Standards Board and the International Ethics Standards Board for
Accountants’ International Code of Ethics for Professional Accountants (including International Independence
Standards) (‘IESBA Code’), and we have fulfilled our other ethical responsibilities in accordance with these
requirements and the IESBA Code.
Our responsibilities under ISAs (NZ) are further described in the Auditor’s responsibilities for the audit of the
consolidated financial statements section of our report.
Our firm has also provided other services to the Group comprising compliances services relating to the research
and development tax credit scheme. Subject to certain restrictions, partners and employees of our firm may also
deal with the Group on normal terms within the ordinary course of trading activities of the business of the
Group. These matters have not impaired our independence as auditor of the Group. The firm has no other
relationship with, or interest in, the Group.
Materiality
The scope of our audit was influenced by our application of materiality. Materiality helped us to determine the
nature, timing and extent of our audit procedures and to evaluate the effect of misstatements, both individually
and on the consolidated financial statements as a whole. The materiality for the consolidated financial
statements as a whole was set at $1,350,000 determined with reference to a benchmark of profit/(loss) for the
year before tax (excluding bull team revaluation movements). We chose the benchmark because, in our view,
this is a key measure of the Group’s performance.

20 Livestock Improvement Corporation Consolidated Annual Report 2021/22

Key audit matters
Key audit matters are those matters that, in our professional judgement, were of most significance in our audit
of the consolidated financial statements in the current period. We summarise below those matters and our key
audit procedures to address those matters in order that the shareholders as a body may better understand the
process by which we arrived at our audit opinion. Our procedures were undertaken in the context of and solely
for the purpose of our statutory audit opinion on the consolidated financial statements as a whole and we do not
express discrete opinions on separate elements of the consolidated financial statements.
The key audit matter How the matter was addressed in our audit
Valuation of the Bull Team
Refer to Note 2 to the Financial Statements.
Determining the valuation of the bull team,
which is the core asset to both the domestic
and international genetics operations of the
Group, is a highly judgemental and complex
area. Management prepares a model that
projects the number and types of straws that
the current team can produce and will be sold
over the useful life of the bulls. The valuation
model factors the cost of rearing, animal and
farm management costs, and forecasts of
processing costs to make sales. The calculated
surplus is discounted to reflect the time value
of money.
Our audit procedures included, among others, valuation
specialist review of the model and challenge of
management’s significant assumptions such as:
 Projected sales volumes and pricing;
 Discount rates applied; and
 Runoff Profile of the bulls.
We compared sales and costs growth, and inflation rates to
historical data and published market forecast data where
available. We reviewed market and industry data to assess
management’s discount rate applied to the financial model.
We assessed the runoff profile of the bulls against historical
data. We found the inputs to be comparable.
We also considered management’s forecasts in previous
years and found it to be sufficiently accurate based on actual
results achieved.
Carrying Value of Intangible Assets
Refer to Note 4 to the Financial Statements.
The Group has two categories of intangible
assets with indefinite useful lives:
 Goodwill of $2.3m, arising from a number of
acquisitions; and
 The LIC Animal Database of $10.5m which
is used by the Group to deliver its Herd
Testing and Farm Software services.
The two significant cash generating units
(CGUs) holding these assets are tested
annually for impairment using discounted
cashflow models to determine the recoverable
amount.
The annual impairment tests performed by the
Group were significant to our audit due to the
magnitude of the intangible assets and because
the discounted cashflow models involve
judgement about the future performance of the
CGU’s, including considering future economic
and market conditions.
We challenged management on the reasonableness of the
assumptions included in the cashflow forecast models, with
particular attention paid to the following:
 Assessing management’s future sales and growth
assumptions compared to external market and industry
data and historical performance of each of the CGU’s. We
used our own valuation specialists to assist us with the
consideration of the discount rates;
 Comparing management’s previous forecasts to actual
results achieved in each CGU; and
 Performing sensitivity analysis around the key
assumptions used in the model.
We also challenged management on whether the market
capitalisation of the Group is an indicator of impairment and
subsequently used our own valuation specialists to challenge
management’s assessment of appropriate maintainable
earnings and earnings multiple applied in their impairment
test.
Our testing supported management’s conclusion that there is
no impairment.
Livestock Improvement Corporation Consolidated Annual Report 2021/22 21
Livestock Improvement Corporation Consolidated Annual Report 2021/22 21

Other information
The Directors, on behalf of the Group, are responsible for the other information included in the entity’s Annual
Report. Other information includes the Directors Report and the Governance Report. Our opinion on the
consolidated financial statements does not cover any other information and we do not express any form of
assurance conclusion thereon.
In connection with our audit of the consolidated financial statements our responsibility is to read the other
information and, in doing so, consider whether the other information is materially inconsistent with the
consolidated financial statements or our knowledge obtained in the audit or otherwise appears materially
misstated. If, based on the work we have performed, we conclude that there is a material misstatement of this
other information, we are required to report that fact. We have nothing to report in this regard.
Use of this independent auditor’s report
This independent auditor’s report is made solely to the shareholders as a body. Our audit work has been
undertaken so that we might state to the shareholders those matters we are required to state to them in the
independent auditor’s report and for no other purpose. To the fullest extent permitted by law, we do not accept
or assume responsibility to anyone other than the shareholders as a body for our audit work, this independent
auditor’s report, or any of the opinions we have formed.
Responsibilities of the Directors for the consolidated financial
statements
The Directors, on behalf of the Company, are responsible for:
— The preparation and fair presentation of the consolidated financial statements in accordance with generally
accepted accounting practice in New Zealand (being New Zealand Equivalents to International Financial
Reporting Standards) and International Financial Reporting Standards;
— Implementing necessary internal control to enable the preparation of a consolidated set of financial
statements that is fairly presented and free from material misstatement, whether due to fraud or error; and
— Assessing the ability to continue as a going concern. This includes disclosing, as applicable, matters related
to going concern and using the going concern basis of accounting unless they either intend to liquidate or to
cease operations or have no realistic alternative but to do so.
Auditor’s responsibilities for the audit of the consolidated financial
statements
Our objective is:
— To obtain reasonable assurance about whether the consolidated financial statements as a whole are free
from material misstatement, whether due to fraud or error; and
— To issue an independent auditor’s report that includes our opinion.
Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance
with ISAs NZ will always detect a material misstatement when it exists.
Misstatements can arise from fraud or error. They are considered material if, individually or in the aggregate,
they could reasonably be expected to influence the economic decisions of users taken on the basis of these
consolidated financial statements.

22 Livestock Improvement Corporation Consolidated Annual Report 2021/22
22 Livestock Improvement Corporation Consolidated Annual Report 2021/22

Other information
The Directors, on behalf of the Group, are responsible for the other information included in the entity’s Annual
Report. Other information includes the Directors Report and the Governance Report. Our opinion on the
consolidated financial statements does not cover any other information and we do not express any form of
assurance conclusion thereon.
In connection with our audit of the consolidated financial statements our responsibility is to read the other
information and, in doing so, consider whether the other information is materially inconsistent with the
consolidated financial statements or our knowledge obtained in the audit or otherwise appears materially
misstated. If, based on the work we have performed, we conclude that there is a material misstatement of this
other information, we are required to report that fact. We have nothing to report in this regard.
Use of this independent auditor’s report
This independent auditor’s report is made solely to the shareholders as a body. Our audit work has been
undertaken so that we might state to the shareholders those matters we are required to state to them in the
independent auditor’s report and for no other purpose. To the fullest extent permitted by law, we do not accept
or assume responsibility to anyone other than the shareholders as a body for our audit work, this independent
auditor’s report, or any of the opinions we have formed.
Responsibilities of the Directors for the consolidated financial
statements
The Directors, on behalf of the Company, are responsible for:
— The preparation and fair presentation of the consolidated financial statements in accordance with generally
accepted accounting practice in New Zealand (being New Zealand Equivalents to International Financial
Reporting Standards) and International Financial Reporting Standards;
— Implementing necessary internal control to enable the preparation of a consolidated set of financial
statements that is fairly presented and free from material misstatement, whether due to fraud or error; and
— Assessing the ability to continue as a going concern. This includes disclosing, as applicable, matters related
to going concern and using the going concern basis of accounting unless they either intend to liquidate or to
cease operations or have no realistic alternative but to do so.
Auditor’s responsibilities for the audit of the consolidated financial
statements
Our objective is:
— To obtain reasonable assurance about whether the consolidated financial statements as a whole are free
from material misstatement, whether due to fraud or error; and
— To issue an independent auditor’s report that includes our opinion.
Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance
with ISAs NZ will always detect a material misstatement when it exists.
Misstatements can arise from fraud or error. They are considered material if, individually or in the aggregate,
they could reasonably be expected to influence the economic decisions of users taken on the basis of these
consolidated financial statements.

22 Livestock Improvement Corporation Consolidated Annual Report 2021/22

A further description of our responsibilities for the audit of these consolidated financial statements is located at
the External Reporting Board (XRB) website at:
http://www.xrb.govt.nz/standards-for-assurance-practitioners/auditors-responsibilities/audit-report-1/
This description forms part of our independent auditor’s report.
The engagement partner on the audit resulting in this independent auditor's report is Trevor Newland.
For and on behalf of

Hamilton
20 July 2022

Livestock Improvement Corporation Consolidated Annual Report 2021/22 23
Livestock Improvement Corporation Consolidated Annual Report 2021/22 23

Directors' Report 2021 -22
LIC delivers record dividend to farmer shareholders as co-op continues to
drive value on-farm

The LIC Board announces a record result for
the 2021-22 financial year driven by increased
farmer spend on premium genetics and herd
improvement services to breed more efficient
cows with a lighter environmental footprint.
Reporting a 15.3% increase in underlying earnings,
the farmer-owned co-operative will return $26.2
million in dividend to shareholders. This equates
to 18.43 cents per share with a 18.5% gross yield
on the current share price. It will be paid on
19 August.
The Board is pleased to present this result for
our farmers, particularly after a year hampered
by Covid-19, inflationary pressures and supply
challenges.
The Board thanks our farmer shareholders for
their ongoing support, many of whom faced
similar challenges as us. Delivering value for our
farmers is at the centre of everything we do and
it’s results like this that enable us to do just that –
through our herd improvement products
and services, a solid dividend, and, importantly,
the right R&D investment to keep their herds
profitable and sustainable into the future.
Summary of financials
• Total Revenue from Continuing Operations:
$263.2 million (up 5.7%)
• Net Profit After Tax (NPAT): $26.7 million
(up 16.5%)
• Underlying Earnings: $25.7 million (up 15.3%)
• Strong balance sheet, no debt at year-end
and total assets $385.6 million (up 1.2%)
• Dividend: $26.2 million total, or
18.43c per share
• R&D investment: $18.2 million or 6.9% of
revenue (up 6.2% from $17.1 million)
24 Livestock Improvement Corporation Consolidated Annual Report 2021/22

This result is driven by an increasing number
of farmers opting for the co-op’s premium bull
teams to breed high genetic merit cows which
produce more milk, more efficiently – resulting in
a lower environmental footprint per kilogram of
milksolid produced.
The dairy industry needs to keep evolving to
meet the challenges posed by climate change.
Consumers expect a more sustainable approach
to farming and this result reaffirms our farmers are
well dialled into this.
The production efficiency of every cow in
our national dairy herd has never been more
important; farmers know that all cows aren’t
created equal and they are investing in solutions to
breed the best cows, faster.
These breeding decisions will serve them well
into the future to build a more profitable and
sustainable dairy sector and meet climate goals.
During the 2021-22 year, 71% of fresh semen straws
used for breeding replacements were from LIC’s
premium bull teams (2.1 million straws), up from
60% the year prior (1.8 million straws). These teams
utilise younger bulls, selected using genomic DNA
technology so they can be made available to
farmers earlier and fast track the rate of genetic
gain on-farm.
The co-op has invested heavily into genomics over
the last 30 years and new research has confirmed
farmers are reaping the rewards of this now.
Long term users of LIC genetics have almost
doubled the speed of improvement in their
herds over the last decade. They are not only
breeding genetically superior cows which are more
emissions efficient, they’re also breeding them
at a much faster rate and genomics is the key
contributor to this.
We don’t need to milk more cows, we just need to milk
the best cows and the Board is really pleased that our
farmers are making solid progress in this space.
In other business activity, orders for sexed semen
almost doubled from the previous year, exceeding
200,000 straws for the first time. International
exports also saw an increased demand for sexed
semen, while overall straws numbers sent offshore
remained steady on the year prior.
DNA verification tests increased (up 15%), as did
LIC’s range of animal health tests (up 21%), with a
notable increase in Johne’s disease testing with
close to one million samples tested (up 28%). The
number of animals recorded in MINDA, LIC’s herd
management system, also remained steady, as
did herd testing with a modest increase in total
samples processed, however more farmers are
using the Co-op’s EZ Link devices to help simplify
and speed up the herd testing process (up 4%).
During the year the co-op invested $18.2 million
into R&D, up from $17.1 million the year prior,
maintaining its position as one of the largest
private investors in R&D at 6.9% of revenue.
A large proportion of this investment was directed
to the co-op’s large-scale methane trial, with
CRV and funding support from the New Zealand
Agricultural Greenhouse Gas Research Centre,
which is aimed at discovering a genetic link for
methane production to ultimately enable farmers
to breed cows that emit less methane.
The trial has been measuring feed intake and
methane emissions from 300 young bulls and
results from this phase are expected to be released
later this year.
Other key events during the year included the
completion of the sale of the automation business
to MSD Animal Health, which then resulted in the
co-op’s first special dividend payment to partially
distribute the sale funds, and the appointment of a
new Chief Executive, David Chin, who took over the
reins in January.

Outlook
LIC expects underlying earnings in 2022-23 to be in
the range of $20-26 million, assuming no significant
climate event or milk price change takes place
between now and then, nor any major impacts from
M. bovis or Covid-19.
A key focus for the year ahead remains on
delivering to the three commitments in the co-
op’s strategy - operational excellence, faster
genetic improvement and software reliability and
performance. The co-op’s performance against
these commitments during the 2021-22 year will be
reported on at its Annual Meeting in October.
Livestock Improvement Corporation Consolidated Annual Report 2021/22 25

Corporate Governance Statement
Livestock Improvement Corporation (“LIC” or the “Company”) is a New Zealand Co-operative Company,
owned by New Zealand dairy farmers. Its shares are quoted on the Main Board of the New Zealand
Stock Exchange (NZX). In this section of the 2022 Annual Report, we report against the Principles and
Recommendations of the NZX Corporate Governance Code (the NZX Code) and the extent that LIC
has followed the NZX Code’s recommendations. This statement is current to 31 May 2022 and has been
approved by the Directors of LIC.
LIC is primarily involved in the development, production and marketing of artificial breeding, genetics, farm
software, and herd testing services in the New Zealand dairy industry, the control and maintenance of the
LIC database and the execution of research relating to dairy herd improvement.

On LIC's website (https://www.lic.co.nz/shareholders/corporategovernance/) you will find the following
corporate governance documents:
• Constitution
Charters
• LIC Board Charter
• Audit, Finance & Risk Committee Charter
• Remuneration and Appointments Committee Charter
• Disclosure Committee Charter
• LIC Shareholder Reference Group, Board and Management Engagement Charter

Other Corporate Governance Documents
• Code of Conduct and Ethics
• Continuous Disclosure Policy
• Diversity and Inclusion Policy
• Dividend Policy
• External Audit Independence Policy
• Honoraria Committee Terms of Reference
• Shareholder Reference Group Terms of Reference
• Share Trading and Disclosure Policy
Our latest Sustainability Report can also be accessed on LIC’s website
(https://www.lic.co.nz/about/sustainability/)
Corporate Governance Report
26 Livestock Improvement Corporation Consolidated Annual Report 2021/22

Co-operative Principles
LIC’s co-operative principles are set out in its Constitution and are:
a) The Company will remain a Co-operative
Company;
b) The Company is controlled by Users of
the Company’s qualifying products and
services;
c) Core products and services are made
available to all Shareholders at fair
commercial prices;
d) Products and services which benefit
Shareholders and which otherwise might not
be made available, are developed and made
available to Shareholders, provided that the
company receives a commercial return; and
e) Shareholders co-operate with the Company
and each other, including the sharing of
information to promote their common interests.
NZX Code Principle 1, Code of Ethical Behaviour: Directors should set high standards of ethical
behaviour, model this behaviour and hold management accountable for these standards being
followed throughout the organisation.
Code of Conduct and Ethics
LIC's Code of Conduct and Ethics sets out the
ethical and behaviour standards expected of
Directors and employees of LIC. The Policy is
reviewed biennially (or as required) to keep it up
to date with employee, shareholder and other
stakeholder expectations. Directors and employees
are also expected to uphold LIC's values of integrity,
innovation, being in-tune with our farmers, passion
and spirit of cooperation.
Whistleblowing
The Code of Conduct and Ethics and the
Company's Employment Relations Policy, which are
available to employees on LIC's intranet, include
guidance on specific action to be taken by a
person who suspects a serious wrongdoing.
Avoiding conflicts of interest
The Code of Conduct and Ethics includes direction
on disclosing and managing conflicts of interest.
The Board updates changes in interests and any
potential conflicts at each meeting. LIC’s General
Counsel holds a Directors' interests register and
the Board reviews the register at each meeting.
The register records relevant transactions and
disclosures of interests. The Directors’ interests are
set out on page 44.
Trading in securities
The Company has a Share Trading and Disclosure
Policy for Directors, members of the Company’s
Shareholder Reference Group (SRG), Restricted
Persons and other Employees wanting to deal in
the securities of the Company.
The Policy outlines:
• when Directors, members of the SRG,
Restricted Persons and other Employees
of the Company may deal in the shares of
the Company;
• procedures to reduce the risk of insider
trading; and
• disclosure requirements.

The Policy records the Company's procedures for
compliance with the Financial Markets Conduct
Act 2013 (FMC Act), the NZX Listing Rules and
other relevant legislation/regulation for the
trading and disclosure of trading in the shares of
the Company and details the exemption granted
by the Financial Markets Authority from certain
provisions of the FMC Act. The exemption permits
LIC’s constitutional and co-operative requirements
and the Rules of its Employee Share Scheme to
operate alongside the insider trading provisions of
the FMC Act.

Livestock Improvement Corporation Consolidated Annual Report 2021/22 27

The Policy aims to protect Directors, members
of the SRG, Restricted Persons and Employees,
as well as the Company and the Company's
Shareholders, against acts of insider trading
that could disadvantage holders of the
Company's shares.
An Elected Director must hold the minimum
shareholding requirement and can hold
additional shares in accordance with the
Company’s Constitution.
NZX Code Principle 2, Board composition and performance: To ensure an effective board, there should
be a balance of independence, skills, knowledge, experience and perspectives.
Role of the Board
Legislation, the NZX Listing Rules and the
Constitution establish the Board's responsibility
and include provisions for how the Company
will operate. The structure of the Board and its
governance arrangements are set out in the
Company's Constitution and in the Board's
written Charter which outlines the Board and
Management's roles and responsibilities. The
Board is responsible for the direction and control of
LIC's activities. It is also committed to the guiding
values of the Company.
Board responsibilities
The Board is responsible for setting the strategy
of LIC and monitoring delivery against that
strategy, recognising the Company’s economic,
environmental and social responsibilities.
In 2021 the Board refined LIC’s business strategy
and purpose – to deliver superior genetics and
technological innovation to help shareholders
sustainably farm a profitable animal. Value for our
farmer shareholders is at the heart of our strategy.
LIC will drive value, innovate and deliver a positive
impact for customers and shareholders by focusing
on the following:
Our Farmers

Deepen our
understanding of the
current and future needs
of all of our farmers.
Digital & Data

Modernising the
animal data & digital
capabilities.
Animal

Most sustainable
& efficient animal.
Highest value products.
Innovation

Research & development.
Responsive innovation.
28 Livestock Improvement Corporation Consolidated Annual Report 2021/22

The Board is also responsible for approval of
significant expenditures, policy determination,
selection of Appointed Directors, and stewardship
of the Company's assets. Management is
responsible for implementing the strategic
objectives, operating within the risk appetite set
by the Board, and for all other day-to-day running
of the Company. The Board delegates the day-to-
day leadership and management of the Company
to the Chief Executive (CE). The delegations are
set out in the Board Charter and in a Delegated
Authorities framework, which also sets out
authority levels for types of commitments that the
Company's management can make. A copy of the
Board Charter is available on LIC's website.
Notwithstanding the responsibilities of the Board,
the Board and Shareholders will not, except with
the written consent of the Minister for Primary
Industries, or other relevant Minister, exercise any
of their rights, directions and powers under, or
alter the Constitution so as to cause or permit the
Company to cease to be a Co-operative supplying
goods and services to Shareholders.
Board composition
The Board is comprised of six Elected and three
Appointed Directors. The 2020 changes to the
governance of LIC allows for up to four Appointed
Directors to be appointed to the Board.
The current Board of Directors is made up
as follows:
• Elected Directors: Murray King (Chair), Gray
Baldwin, Ben Dickie, Ken Hames, Matt Ross
and Alison Watters.
• Appointed Directors: Tim Gibson, Sophie
Haslem and Candace Kinser.
Information about each Director, including
their independence, ownership interests and
attendance at board meetings, is included in this
section. A profile of each Director's experience,
including the length of their service, is included on
the LIC website.
Full details of the strategy, including the measures for each of these commitments, are available on LIC’s
website at (https://www.lic.co.nz/about/our-strategy/)
LIC’s strategy makes three commitments to farmers:
Operational
Excellence
LIC commits to getting the
basics right and delivering for
farmers, on time, every time.
Faster Genetic
Improvement

LIC commits to having farmers’
backs when it comes to helping
them meet the environmental
challenges they face, in
particular animal efficiency,
and nitrogen and methane
mitigation.
Software Reliability
and Performance

LIC commits to being better at
delivering its software to farmers.
LIC renews its commitment to
continuous improvement and
transparency around delivery of
new features.
123
Livestock Improvement Corporation Consolidated Annual Report 2021/22 29

Nomination, election and appointment
of Directors
The nomination, election and appointment of
Directors to the Board of LIC is also governed by
the LIC Constitution. The relevant NZX Rulings and
waivers to the NZX Listing Rules are set out on
pages 50 and 51.
Elected Directors are nominated and elected
by Shareholders within the region each Director
represents (two regions in total). Once elected
they will hold office for a period of approximately
three years. The term will be in accordance with
the Rotation Schedule. The election of Directors
in 2022 will see the final step of the transition plan
approved by shareholders in 2020 when they
voted in favour of reducing the number of Elected
Directors from seven to six and the number of
regions from four to two.
All recommendations and deliberations on the
selection of Appointed Directors are undertaken by
the full Board. Appointed Directors hold office for
approximately three years.
A retiring Director is eligible for re-election or
re-appointment as a Director of the Company.
All Appointed Directors have entered into
written agreements setting out the terms of their
engagement and all newly Elected Directors will
also do so.
In relation to the nomination and appointment of
Directors, appropriate checks are undertaken. This
includes the provision of key information about
candidates to Shareholders and/or the Board, such
as relevant skills, experience and directorships
and any material adverse information of which the
Company has become aware.
Candace Kinser was due to retire by rotation in
October 2021 and sought re-appointment. Her
appointment as an Appointed Director was ratified
by shareholders at the 2021 Annual Meeting for a
further term of approximately three years.
In this year’s Director elections, and under the
transitional arrangements put in place as part
of the governance and representation changes
introduced in 2020, three North Island Directors,
Gray Baldwin, Ben Dickie and Alison Watters, are
due to retire by rotation at the Annual Meeting.
Gray Baldwin has decided, after ten years on the
LIC Board, to retire while Ben Dickie and Alison
Watters are seeking re-election for the two North
Island vacancies. In addition, a third Director is to
be sought for the South Island this year, thereby
completing the transitional arrangements referred
to above.
The elections are timed to coincide with the 2022
Annual Meeting.
Appointed Director, Tim Gibson is due to retire by
rotation in October 2022 and, with the support of
the Board, will be seeking ratification of his
re-appointment for a further term of three years at
the 2022 Annual Meeting.
Meetings
The Board met eight times in 2021/22 with three
additional strategy days. A further six additional
meetings of the Board were held to receive
operational updates on the ongoing impact of
Covid-19 on LIC, consider the divestment of LIC’s
automation business and consider the need for a
Board sub-committee on LIC’s contribution towards
a national genomic animal evaluation system.
30 Livestock Improvement Corporation Consolidated Annual Report 2021/22

Board Attendance:
Board Meetings
Special
Board Meetings
Board Strategy Days
No of meetingsHeldAttendedHeld AttendedHeldAttended
Gray Baldwin886633
Ben Dickie886533
Tim Gibson886632
Ken Hames886533
Sophie Haslem886433
Murray King886633
Candace Kinser 876533
Matt Ross886633
Alison Watters886633
Director training
Directors each undertake appropriate education to
remain current in how to best perform their duties
as Directors. Directors maintain memberships of
relevant bodies such as the Institute of Directors
and receive information individually and from
Management in relation to specific issues relevant
to LIC, the markets in which it operates and the
dairy industry. Directors also undertake in-market
and stakeholder visits when Covid-19 restrictions
have allowed.
The Chair revises development plans for
each of the Directors. These plans specifically
focus on areas that will not only develop the
individual Director but will also enhance overall
Board capability. The Board development and
engagement plan is actively referenced and
reviewed at each Board meeting. In addition,
budget provision is in place for Directors who want
to undertake approved specific higher-level study,
the cost of which is shared on a 50:50 basis.
Board, Committee and Director
Performance
The Board uses an external party to assist
with reviewing the performance of the Board,
individual Directors and its committees on a
regular basis. Independent consultants, Propero
Consulting Limited, were engaged in 2021 to
undertake a formal, independent review of the
performance of the Board, individual Directors
and Board committees. Their findings were shared
with the Board in September 2021. The Board was
found to be operating effectively and specific
areas for further development have been shared
with some Directors.
Director Independence
Directors are appointed in accordance with the
Constitution. The current Appointed Directors are
not co-operative members and are appointed to
bring their external expertise to the Board.
For the purposes of the Listing Rules, the Board
has assessed all of the Directors to be independent
with the exception of Gray Baldwin, who may not be
perceived as independent due to his role as a Director
of Trinity Lands Limited, LIC's largest Shareholder.
The Board has re-assessed Murray King’s tenure
on the Board and has reached the conclusion that
Murray’s tenure does not interfere, nor could it
reasonably be seen to interfere, with his capacity
to bring independent judgment to issues before
the Board and to act in the best interests of the
company and to represent the interests of its
Shareholders generally.
While all farmer Elected Directors are co-operative
members and purchase from and sell goods and
services to LIC, the Board does not consider them to
have a relationship that could reasonably influence,
or be perceived to influence, their ability to bring
an independent view to decisions in relation to LIC,
to act in the best interest of LIC or to represent the
interests of LIC Shareholders generally.
Livestock Improvement Corporation Consolidated Annual Report 2021/22 31

NZX Code Principle 3, Board committees: The board should use committees where this will enhance its
effectiveness in key areas, while still retaining board responsibility.
Committees
LIC Board committees review and consider in
detail the policies and proposals developed by
Management and make recommendations to the
Board. They do not take action or make decisions
on behalf of the Board unless specifically
mandated to do so. A committee or an individual
Director can engage independent legal counsel
at LIC's expense with the prior approval of the
Board Chair.
The Board will occasionally appoint a committee
of Directors to consider or approve a specific
proposal or action if the timing of meetings or
availability of Directors means the matter cannot
be considered by the full Board. Their deliberations
and decisions are reported back to the Board no
later than the next meeting.
Audit, Finance & Risk Committee
A Sub-Committee of the Board, the Audit, Finance
& Risk Committee ensures the Company complies
with its audit, financial and risk management
responsibilities. It operates under a written
charter, which is available on the LIC website.
The Committee is chaired by Appointed Director
Sophie Haslem with the other members being
Murray King, Gray Baldwin, Ben Dickie and Ken
Hames. A majority of the current members of the
Committee are considered to be independent.
Employees only attend Committee meetings at
the invitation of the Committee.
The Committee meets at least four times a year
and met six times in 2021/22.
Chair
As noted above, LIC's Chair is assessed to be an
independent Director. LIC's Board also endorses
the separation of the roles of the Chair and
Chief Executive (CE) and a Director should not
simultaneously hold both roles.
In addition, to ensure appropriate management
where necessary, the LIC Board Charter sets out an
exception to this whereby the Board may appoint a
Director to assume the post of CE concurrently on
a temporary basis when the post of CE is vacant,
for a period of no longer than six months. This can
be extended, only where the position of CE is still
vacant for a further maximum period of six months.
At the termination of that further period, that
Director shall resign from the Board.
32 Livestock Improvement Corporation Consolidated Annual Report 2021/22

Remuneration and
Appointments Committee
A Sub-Committee of the Board, the
Remuneration and Appointments Committee
approves appointments and terms of
remuneration of the Chief Executive, oversees
the people policies for LIC and also considers
and assists the Board in its director appointment
process, and if appropriate recommends to
the Board any wage and salary percentage
adjustments for the Co-operative's employees.
It operates under a written charter, which is
available on the LIC website. The Committee is
chaired by Appointed Director Tim Gibson with
the other members being Murray King, Matt Ross
and Alison Watters. All current members of the
Committee are considered to be independent.
Management only attends Committee meetings
at the invitation of the Committee.
The Committee meets at least four times a year
and met four times in 2021/22. Two special meetings
of the Committee were also held to discuss out of
round performance payments and the Board and
Board Chair succession.
Disclosure Committee
A Sub-Committee of the Board, the Disclosure
Committee assists the Board and Company in
ensuring that all material information is identified,
reported for review by the Committee, and if
required, disclosed in a timely manner to the NZX.
It operates under a written charter, which is
available on the LIC website. The Committee is
chaired by Board Chair Murray King with the other
members being Appointed Director Sophie Haslem,
the Chief Executive, Chief Financial Officer, General
Counsel and Communications Manager. Disclosure
Committee meetings are also attended by key
members of management as required.
The Committee meets as and when required and
did not meet in 2021/22.
New Zealand Animal Evaluation
Committee
This Sub-Committee of the Board was established
in October 2021. Under its terms of reference, the
Committee has been asked to consider and advise
the Board on the ongoing and future use of LIC
intellectual property in a national genomic animal
evaluation system. The Committee is chaired by
Murray King with the other Director members being
Tim Gibson, Matt Ross and Alison Watters. The
committee met nine times in 2021/22, including
three meetings with members of DairyNZ and/or
New Zealand Animal Evaluation Limited (NZAEL).
The Board believes that the importance of LIC’s
contribution to a future national genomic animal
evaluation system should not be underestimated
or undervalued and it is a Board priority that
discussions with DairyNZ and NZAEL reflect this.
Livestock Improvement Corporation Consolidated Annual Report 2021/22 33

Board Committee attendance:
Audit, Finance
& Risk Committee
Remuneration &
Appointments Committee
Disclosure
Committee
NZ Animal
Evaluation
Committee
Special
No of meetingsHeldAttendedHeldAttendedHeldAttendedHeldAttendedHeldAttended
Gray Baldwin66--------
Ben Dickie66--------
Tim Gibson--4421--98
Ken Hames 66--------
Sophie Haslem66--------
Murray King664422--99
Candace Kinser ----------
Matt Ross--4422--99
Alison Watters--4422--99
Technology Advisory Board
In addition to the above Committees, Appointed
Director Candace Kinser chaired four meetings of
LIC's Technology Advisory Board during 2021/22.
Four senior external technology experts with
leading technology management and strategy
experience are members of the Technology
Advisory Board, which was established by the
Board to provide guidance and advice to senior
management and the Board on LIC’s technology
direction and strategy.
Takeovers
Due to LIC’s Co-operative Company status, its
Constitution and the Dairy Industry Restructuring
Act 2001 (DIRA) based shareholding restrictions,
it is not necessary to have takeover protocols in
place. Under LIC’s Constitution no person shall
hold a relevant interest of more than 5% of the total
number of ordinary shares in the Company.
34 Livestock Improvement Corporation Consolidated Annual Report 2021/22

NZX Code Principle 4, Reporting and disclosure: The Board should demand integrity in financial and
non-financial reporting, and in the timeliness and balance of corporate disclosures.
Financial reporting
The Board is responsible overall for ensuring
the integrity of the Company's reporting to
Shareholders, including financial statements
that comply with generally accepted accounting
practice (NZ GAAP).
The Board's Audit, Finance & Risk Committee
oversees the quality, reliability and accuracy of the
financial statements and related documents and
its role is more fully described in its Charter which is
available on the LIC website. In undertaking its role,
the Committee makes enquiries of Management
and the external auditors, including requiring
Management representations, so that the Directors
can be satisfied as to the validity and accuracy of
all aspects of LIC's financial reporting.
Disclosure to the market
LIC has a written disclosure policy: the Continuous
Disclosure Policy can be found on our website. It
sets out requirements for full and timely disclosure
to the market of material information, so that all
stakeholders have equal access to information. The
Board specifically consider with Management at
each board meeting whether there are any issues
which might require disclosure to the market under
the NZX continuous disclosure requirements.
Non-financial reporting
Sustainability
In September 2021 LIC published its first
standalone sustainability report. This report was
prepared in accordance with the core option of the
Global Reporting Initiative (GRI) Standards and is
in line with our commitments as members of the
Climate Leaders Coalition and the Sustainable
Business Council. The Sustainability Report is the
start of LIC’s integrated reporting journey.

Diversity and Inclusion
The Company fosters an inclusive working
environment that promotes employment equity
and workforce diversity at all levels, including
within the Senior Leadership Team and the Board.
The Diversity and Inclusion Policy is available on
LIC's website.
As at the 2021/22 year-end, members of the
Board and Senior Leadership Team self-identified
as follows:
LIC’s staff-led Diversity and Inclusion
Committee aims to:
• foster a shared vision of embracing diversity
across all areas of LIC
• assist in building a welcoming, inclusive and
safe environment that enables LIC to attract
and retain the best employees
• assist in increasing the diversity of the LIC
workforce and leadership team to better
reflect the diversity of the community in which
LIC operates
• build a culture that enables all employees to
reach their full potential and create a true
sense of inclusive collegiality
Committee members have continued to undertake
training on “creating an inclusive work environment”
and have been active in engaging and educating
staff. A variety of diversity and inclusion related
topics, information and events have been presented
to staff and a regular newsletter is now being
produced which highlights specific cultural and
international events and celebrations.

20222021
MFGDMFGD
LIC Board
63-63-
LIC Senior
Leadership
Team
52-62-
Key: M = Male / F = Female / GD = Gender Diverse
Livestock Improvement Corporation Consolidated Annual Report 2021/22 35

In September 2021 Te Wiki o Te Reo Māori was
celebrated across LIC and staff were actively
encouraged to take part, including by joining
the Māori Language Moment run by the Māori
Language Commission. As part of our ongoing
commitment to Te Reo Māori, initial discussions
have been held with an external provider to start a
programme of work at LIC with scoping due in the
coming financial year.
LIC continues to collect baseline data from its
employees on an opt-in basis, which now includes
religion, gender identity and disability, in addition to
age and ethnicity. This information has highlighted
that LIC is a reasonably diverse company. The aim
is to continually update our baseline data so that
targeted initiatives can be completed.
In support of initiatives that foster an inclusive
working environment, all external advertising
for positions at LIC are worded to encourage a
diverse range of applicants and state LIC’s desire
to drive for diversity and inclusion within our
workplace. Management appointment interviews
are conducted by a panel that represents diversity
of thought. Training for all employees is provided
on the benefits of diversity and inclusion and has
been developed and implemented to drive an
understanding of unconscious bias.
In addition to the above, LIC continues to
look at its employment practices, including
protection of vulnerable persons, regional
presence and youth employment.
Non-financial risks
LIC's assessment of exposure to non-financial risks,
including economic, environmental and health and
safety risks, is included in LIC's risk assessment
process described under Principle 6.
NZX Code Principle 5, Remuneration: The remuneration of directors and executives should be
transparent, fair and reasonable.
In thousands of New Zealand dollars.
BoardAFRCRem TA BOther
Total
Fees
M King124124
G Baldwin5454
B Dickie5454
T Gibson54135 *72
K Hames5454
S Haslem542074
C Kinser 541367
M Ross5454
A Watters5454
607
*A discretionary payment for additional work done in connection with the
recruitment of the CE
Directors Remuneration
Under LIC's Constitution, LIC has an Honoraria
Committee tasked with considering and
recommending to Shareholders the form and
amount of fees paid to LIC’s Directors. The
Honoraria Committee is made up of between
two and four Shareholders, elected by their
fellow Shareholders. The Honoraria Committee’s
terms of reference are on the LIC website. LIC
does not have a directors’ remuneration policy,
relying instead on the Honoraria Committee to
recommend to Shareholders the remuneration to
be paid to the Directors.
The total remuneration for LIC's Directors is
approved by Shareholders at the Annual Meeting
and the current pool of $669,600 was approved at
the meeting held in October 2019.
Directors of the Company received the following
remuneration for the twelve months ending
31 May 2022:
36 Livestock Improvement Corporation Consolidated Annual Report 2021/22

In addition to the above remuneration, and in
accordance with the Constitution, Directors
are reimbursed for any actual and reasonable
expenses incurred while on LIC business. This is
paid in the form of a standard annual incidental
allowance and any further actual and reasonable
expenses incurred while on LIC business. The
standard annual incidental allowance is set at
$1,200 for each Director and $6,000 for the Chair.
The payment of a standard incidental allowance
reduces the administrative effort required in
submitting and processing transactions of a
relatively low value.
The Directors receive no other benefits.
Directors of subsidiaries of the Company received
the following remuneration for the twelve months
ending 31 May 2022:

Except as set out above, no other Directors of
subsidiaries received any remuneration or other
benefits in their role as a Director of that subsidiary.
The remuneration of employees that receive
more than $100,000 as a result of employee
remuneration (and other benefits) is included in the
Employees' Remuneration table on page 38.
Chief Executive Remuneration
Newly appointed Chief Executive, David
Chin’s remuneration package is made up of a
combination of base salary and performance
payments. His performance is assessed based on a
range of factors including:
• Overall financial performance
• Organisational health (target to be a top
quartile organisation)
• Customer delivery (target to achieve
consistent positive movements in customer Net
Promoter Score)
• Delivery of strategy and key projects
The CE’s remuneration package does not include
any long-term incentives or share options.
In thousands of New Zealand dollars.
Fees
E Ruiz4
4
Livestock Improvement Corporation Consolidated Annual Report 2021/22 37

Remuneration Range (Gross)Current EmployeesExited EmployeesTotal
100,000 – 109,999 63 2 65
110,000 – 119,999 38 4 42
120,000 – 129,999 25 1 26
130,000 – 139,999 19 1 20
140,000 – 149,999 20 1 21
150,000 – 159,999 10 1 11
160,000 – 169,999 8 - 8
170,000 – 179,999 1 2 3
180,000 – 189,999 3 - 3
190,000 – 199,999 4 - 4
200,000 – 209,999 3 - 3
210,000 – 219,999 7 1 8
220,000 – 229,999 3 - 3
230,000 – 239,999 2 - 2
240,000 - 249,999 3 - 3
250,000 – 259,999 4 - 4
280,000 – 289,999 - 1 1
290,000 – 299,9991-1
320,000 – 329,999 1 - 1
340,000 – 349,9991-1
350,000 – 359,9991-1
370,000 – 379,999-11
400,000 – 409,999 1 - 1
490,000 – 499,999 2 - 2
580,000 – 589,999 1 - 1
1,370,000 – 1,379,999 - 11
221 16237
LIC has a Remuneration Policy for all employees
which is available to employees on LIC's intranet.
LIC aims to have a remuneration framework
and policies to attract and retain talented and
motivated people. The Company wants to:
1. Be recognised as a great place to work;
2. Recognise and reward successes, while
encouraging teamwork and a high
performance culture;
3. Be fair and consistent;
4. Be true to our values of integrity, innovation,
spirit of co-operation, in tune and passion.
We use market data to determine fair remuneration
levels for all staff. Short term incentives apply
to executive and certain Management roles for
achievement of specific objectives and in relation
to achievement of project initiatives. During the
period 1 June 2021 to 31 May 2022 the following
numbers of employees (not being Directors)
received total remuneration, including benefits,
of at least $100,000:
Employee Remuneration
38 Livestock Improvement Corporation Consolidated Annual Report 2021/22

Biosecurity & Animal Health
A biosecurity or animal health event
impacts LIC’s livestock or its ability to
provide products or services to
its customers.
Disruption to Production or Service
Any disruption caused by processes, people,
equipment, systems, software availability or
external events which affects LIC’s ability to
deliver quality semen or other products and
services to its customers.
Brand Damage
Continued short-term reputational
damage results in damage to LIC’s brand.
Economic Conditions on Farm
LIC’s revenue may be reduced as farmers
decrease expenditure as a consequence of
reduced returns, availability of cash or an
increased cost of production resulting from
milk price, exchange rates, government
regulation or political stability.
Market Disruption
The inability to commercialise innovations
or respond quickly to market disruption or
emerging technology causes reduce use by
shareholders of existing products or services
with a resultant reduction in revenue.
Compliance
Breaches of laws, regulations, licenses,
standards, NZX continuous disclosure
requirements or OMARs result in
restrictions, penalties, or loss.
NZX Code Principle 6, Risk Management: Directors should have a sound understanding of the material
risks faced by the issuer and how to manage them. The Board should regularly verify that the issuer has
appropriate processes that identify and manage potential and material risks.
Financial Risk
Failure to manage LIC’s debts and financial
leverage or to identify fraud, internal errors
or money owned results in LIC being unable
to cover operational costs and or pay back
its debts.
People & Capability
Availability, capability and engagement of
our people and key vendors to effectively
execute LIC strategic plan.
Strategic Risk
An inability to deliver LIC’s agreed strategy
due to disruption, planning, risk, resourcing
and other barriers not identified or managed.
Health & Safety
The potential for injury or loss of life for
employees, contractors or visitors engaged
in LIC business activities or on LIC sites or
prosecution of the PCBU.
Managing Risk
LIC has a risk management framework in place to
identify, oversee, manage and control risk. LIC’s
risk management framework fosters improved
ownership of risk identification and management
across all levels of the business. Key risk indicators
provide management with a heat map of any risks
requiring increased focus. LIC’s risks status
is reported to the Senior Leadership Team and
the Audit, Finance & Risk Committee on a regular
basis, with each risk category and its associated
risk causes and mitigations reviewed periodically
by the Committee.
LIC’s risk categories include:
Livestock Improvement Corporation Consolidated Annual Report 2021/22 39

Of particular interest to shareholders and
stakeholders are the following updates on LIC’s
key risk categories:
Health and safety
The health and safety of people, our staff,
customers, contractors and anyone we come in
contact with, is of utmost importance to LIC and
remains our highest priority, regardless of the
country they are based in, or which site they are
based at. Due to the diverse nature of our business,
LIC has a wide variety of health and safety risks,
including: working with hazardous substances,
driving, on farm activities (animal handling,
agrichemicals, farm machinery use and regular
presence on customer farms) lone working, working
at heights and manual handling. The Senior
Leadership Team is responsible for reviewing,
monitoring and mitigating LIC's health and safety
risk. The Board ensures that the systems used to
identify and manage health and safety risks are
fit for purpose, are being effectively implemented,
regularly reviewed and improved. Regular reporting
to Management and the Board supports the
provision of assurance that LIC’s health and safety
framework is operating effectively. The Board
continues to maintain visibility and focus on health
and safety with their commitment to health and
safety walk-arounds. Business units have health
and safety representatives and there is a regular
formal governance forum chaired by LIC’s CE.
LIC uses a Total Reportable Incident Rate (TRIR) to
measure health and safety performance against
lag indicators: notifiable events, lost time injuries,
medical treatment claims and traffic infringements.
The rate is based on the number of incidents per
100 full-time equivalent employees. The TRIR for
2021/22 was 2.90, a decrease from 3.49 in 2020/21.
There were two events notified to Worksafe in
2021/22 (compared to one in 2020/21).
The Company’s ongoing focus is to be more
proactive – to take personal ownership, learn from
our safety events and anticipate future safety
risks and needs. LIC’s health and safety strategy
approach focuses on: leadership development,
working together, critical risks management,
measuring performance and supporting workers.
We also focused on enhancing near miss
reporting and the wellbeing of our people through
the introduction of the five ways to wellbeing
programme, which centres on connecting,
being active, learning, giving, and taking notice.
A mental health for managers training module was
rolled out in 2021/22 and a Wellbeing and Recovery
Advisor was employed to progress wellbeing
outcomes at LIC.
LIC’s continued focus on health and safety has
seen LIC retain its secondary level status following
the annual ACC audit.
Disruption to production or service
The Company’s ability to provide sufficient
quality semen during a season relies on a number
of factors, including the maintenance and
operation of key equipment, staff and training and
adherence to approved procedures and processes.
An inability to meet demand for the Company’s
semen would result in significant reputational
damage as well as a reduction in New Zealand
revenue. Standard operating procedures are
well documented and regularly reviewed. Semen
quality is monitored daily and non-return rates are
monitored weekly during the peak of the season.
Business continuance plans are also in place and
reviewed and tested regularly.
Reliance on technology, IT systems and services
increases the impact of system outages and
data loss should a significant adverse technology
event occur. LIC’s toolsets and visibility across
the technology environment provide the ability to
detect potential threats. Business continuity and
disaster recovery plans are in place and reviewed
regularly and backups are performed regularly to
support LIC’s recovery should it be needed.
Economic conditions on farm
The Company’s revenue may be reduced as
farmers decrease expenditure as a consequence
of reduced returns, availability of cash or an
increased cost of production. Reductions in New
Zealand’s milk price will affect returns paid to
farmers: as a net exporter of milk, New Zealand’s
milk price is heavily influenced by reference to the
price set by the Global Dairy Trade. Rural
lenders approach to their lending portfolio may
result in a tightening in policy and in turn less
cash on farm. As a result, farmers may look to
reduce both their capital spend as well as farm
working expenses, including herd improvement.
Increased compliance costs on farm may increase
production costs, with farmers seeking to reduce
costs elsewhere.
40 Livestock Improvement Corporation Consolidated Annual Report 2021/22

The Board and Management continue to explore
growth opportunities and ways to improve
efficiency within LIC and for dairy farmers through
innovative products and solutions. There is
also a continued focus on genomic evaluation,
appropriate selection principles and careful
monitoring of the elite portion of the national herd
to ensure LIC’s breeding scheme continues to
deliver superior dairy genetics to assist farmers in
improving productivity.
Financial Risk
LIC has stringent processes in place to ensure
budgets, forecasts and financial reporting are
accurate and timely. LIC maintains strict internal
controls to manage delegated authority and
remove the opportunity for fraudulent activity. LIC
also has a well-documented and verified accounts
payable and receivable process which has been
independently verified.
Bio-security and animal health
Quarantine procedures are in place in all
LIC-controlled locations with quarantine bulls
maintained separately to production bulls.
Controls are in place on LIC’s bull farms, including
segregation of bulls and double-fencing, for safety
and to reduce the risk of unwanted organisms, such
as Mycoplasma bovis (M.bovis). Bulls are regularly
inspected and undergo health testing. Business
continuity plans are in place and tested. LIC has
veterinary and epidemiological expertise within
the Company.
Market disruption
The inability to commercialise innovations
and/or respond quickly to market disruption
or emerging technologies could cause reduced
use by Shareholders of existing products and
services with a resultant reduction in revenue.
LIC maintains a watching brief on the innovation
and technology landscape and follows agile
product development methodologies to enable
quicker commercialisation of new and improved
products and services and the Board prioritises
capital spend to ensure developments align with
farmer needs.
Livestock Improvement Corporation Consolidated Annual Report 2021/22 41

Compliance
Breaches of laws, regulations, licences,
standards, NZX continuous disclosure
requirements, or market access requirements,
could result in restrictions, penalties, or loss.
LIC uses the New Zealand legal compliance
software tool ComplyWith to ensure clarity of
obligations across the organisation and for
tracking adherence to compliance requirements.
Regular internal audits also take place across
the business.
Strategic risk
Disruption, planning, risk, resourcing or other
barriers not identified or managed could lead to an
inability to deliver on LIC’s strategy, as too would
the lack of availability, capability and engagement
of our people and key vendors. LIC regularly
reviews progress against strategic objectives and
has developed key metrics to ensure delivery of the
commitments made to Shareholders.

The environment
Environmental risks are covered in one or more of
LIC's key risk areas.
LIC is a member of the Climate Leaders Coalition
and the Sustainable Business Council. LIC
measures and publicly reports our greenhouse gas
emissions, and has set a public, science based,
emissions reduction target, and is working with
our suppliers to reduce their emissions as well
as building sustainability into our purchasing
decisions. LIC continues to offer farmers the tools
and genetics they need to breed more efficient
cows and drive sustainability improvements
on-farm. Our Resilient Dairy programme is a great
example of the commitment to long-term future
improvement.

42 Livestock Improvement Corporation Consolidated Annual Report 2021/22

NZX Code Principle 7, Auditors: The Board should ensure the quality and independence of the external
audit process.
External Audit
LIC has an External Auditor Independence Policy
that requires the external auditor to be independent
and to be seen as independent. The Board is
satisfied that there is no relationship between
the Auditor and LIC or any related person at
this time, which could compromise the Auditor's
independence. The Board also obtains confirmation
of independence formally from the Auditor.
To ensure full and frank discussion between
the Audit, Finance & Risk Committee and the
auditors, the auditor's senior representatives meet
separately with the Committee.
The External Auditor Independence Policy sets
out restrictions on non-audit work that can be
performed by the auditor and the Audit, Finance
& Risk Committee is required to approve all
engagements with the auditor.

The policy requires rotation of the key audit
partner every five years, a requirement we are fully
compliant with. LIC’s external auditor attends its
annual shareholder meeting each year to answer
questions from shareholders in relation to the audit.
Internal Audit
LIC does not have a separate internal audit
function. The Risk & Assurance Team performs,
reviews and arranges for external audit resource
to perform internal audits as agreed with the Audit,
Finance & Risk Committee. The Risk & Assurance
Manager reports to each Audit, Finance & Risk
Committee meeting on audit or review issues
and incidents, improvements and changes to
internal controls.

The Board recognises that as its shareholders
are the Company’s owners, customers and
stakeholders, it is responsible for overseeing
shareholder engagement. Shareholder
engagement reflects LIC’s co-operative
ownership structure and values and aims to
be efficient, effective, fit for purpose and meet
shareholder expectations with regard to increased
transparency about LIC’s activities.
The LIC website is the key place for LIC's
financial and operational information including
the Company's presentations, reports,
announcements and media releases. The website
is updated immediately when any announcement
is made to the NZX. Important corporate
governance documents such as the Charters and
policies referred to in this section of the Annual
Report can also be found on the LIC website and
the Annual Report is available in both electronic
and hard copy formats.
LIC provides half-year and annual reporting to the
NZX to keep Shareholders informed and discloses
information to the NZX to meet its continuous
disclosure obligations as required. The Company
communicates with Shareholders through its
Annual Report, half-year financial statements
and at Shareholder meetings, as well as through a
range of media channels on topics which it believes
will be of interest to Shareholders.
We encourage all Shareholders to receive
communications electronically and provide hard
copies of information as and when required.
All Shareholders have the right to vote on
major decisions which may change the nature
of the Company and the Board encourages
all Shareholders to attend and participate in
Shareholder meetings.
This year the LIC Annual Meeting will be held both
virtually and in person on Thursday 20 October
2022 at 12pm at the Hotel Distinction Coachman,
Palmerston North and online (www.lic.co.nz/
annualmeeting). LIC welcomes Shareholders'
attendance either on-line or in person. A Notice
of Meeting will be sent to Shareholders in
September 2022.
NZX Code Principle 8, Shareholder rights and relations: The Board should respect the rights of
shareholders and foster constructive relationships with shareholders that encourage them to engage
with the issuer.
Livestock Improvement Corporation Consolidated Annual Report 2021/22 43

Statutory Requirements
Entries in the interests register

Directors
All Elected Directors are customers and Shareholders of Livestock Improvement Corporation Limited and
purchase products and services for their farming operations on an ongoing basis.
Directorships and Memberships
Gray Walter Baldwin:
Director of:
• Farmlands Co-operative Society Limited
(approx. 13% shareholder in FarmIQ)
• Trinity Lands Limited
• Longview Trust Board (shareholder in Trinity
Lands Limited)
• Wuppertal Farming Limited
Benjamin John Dickie:
Director of:
• Taranaki Veterinary Centre Limited
Timothy Dunlop Gibson:
Director of:
• The Equanut Company Limited (Chair)
• Manage My Health Global Limited
• Miraka Limited and subsidiaries:
Miraka Brands Limited
Miraka Holdings Limited
• Omnieye Holdings Limited
• Port Otago Limited and subsidiaries:
• Chalmers Properties Limited
• Fiordland Pilot Services Limited
• Te Rapa Gateway Limited
• Silver Fern Farms Co-Operative Limited
• Silver Fern Farms Limited and subsidiaries:
• Silver Fern Farms Joint Ventures Limited
• Silver Fern Farms Holdings Limited
• Skills Consulting Group Limited
• Tūhana Business & Human Rights Limited
• Tuhana Consulting Limited
Kenneth Charles Hames:
Chair of
• Extension 350
Duke of Edinburgh Award NZ
Sophie Haslem:
Director of:
• Centreport Limited and subsidiaries:
• Centreport Captive Insurance Limited
• Centreport Properties Limited
• Kordia Group Limited
• Meteorological Service of New Zealand
Limited (Chair)
• Ngāi Tahu Holdings Corporation Limited
• Oyster Property Group Limited (Ceased 31
March 2022) and subsidiaries:
• Oyster Industrial Limited
(Ceased 31 March 2022)
• Oyster Management Limited
(Ceased 31 March 2022)
• Oyster Property Holdings Limited
(Ceased 31 March 2022)
• Tauranga Crossing GP Limited
(Ceased 31 March 2022)
• Payments NZ Limited
• Rangitira Limited
Shareholder of:
• CH4 Global Inc
Murray Grant King:
Director of:
• Appleby Limited
• Callura Dairies Management Limited (Chair)
• Cawthron Institute
• Dry Steam Irrigation Company Limited
• Long Plantation Investments Limited
Director and Shareholder of:
• New Zealand Dairy Dessert Company Limited
• Waimea Irrigators Limited (Chair)
• Waimea Community Dam Limited
44 Livestock Improvement Corporation Consolidated Annual Report 2021/22

Candace Nicole Kinser:
Director of:
• Cancer Society of New Zealand Incorporated
• Eastland Group Limited and subsidiaries:
• Eastland Generation Limited
• Eastland Network Limited
• Eastland Port Limited
• Gisborne Airport Limited
• Helius Therapeutics Limited (Chair)
• New Zealand Health Partnerships Limited
• Punakaiki Fund Limited
• WEL Networks Limited (Ceased 22 June 2021)
Chair of:
• Cancer Society of New Zealand, Auckland
Northland Division Incorporated
• Advisory Board of Superb Herb
Company Limited
Investment Committee Member of:
• Return on Science Investment Scheme at the
University of Auckland
Matthew Fraser Ross:
Director of
• North Otago Irrigation Company Limited (Chair)
Director and Shareholder of:
• Bortons Agri Limited
Alison Jane Watters:
Director of:
• Agriculture Resources Limited
• AsureQuality Limited (Chair)
• BV-AQ (Singapore) Holding Pte Limited
(Ceased 1 May 2022)
• High-Value Nutrition (National Science
Challenge)
• Meteorological Service of New Zealand Limited
• Totally Vets Limited
Shareholder of:
• Aginvest Holdings Limited (27.66%).
Aginvest owns MyFarm Limited which in turn
has a 18.84% holding in Figured Limited

Senior Staff
In addition to the directorships of LIC subsidiaries as detailed below, senior members of staff have recorded
the following interests:
Emma Jane Blott
Director of:
Eurogene AI Services (Ireland) Limited
David James Hazlehurst
Director of:
Figured Limited
Livestock Improvement Corporation Consolidated Annual Report 2021/22 45

The Directors of the Company’s subsidiaries as at 31 May 2022 are set out below:
• LIC Agritechnology Company Limited: Murray
King, Gray Baldwin, Ben Dickie, Tim Gibson,
Ken Hames, Sophie Haslem, Candace Kinser,
Matt Ross and Alison Watters.
• Livestock Improvement (New Zealand)
Corporation Limited: David Chin, David
Hazlehurst and Murray King
• LIC Ventures No 1 Limited (formerly LIC
Automation Limited): David Chin and David
Hazlehurst
• LIC Ventures No.3 Limited: David Chin and
David Hazlehurst
• Agrigate GP Limited (a 100% owned subsidiary
of LIC Ventures No. 3 Limited from 18 August
2021): Emma Blott and David Hazelhurst
• Livestock Improvement Pty Limited: Emma
Blott and Michael Rose
• Farmkeeper Pty Limited: Emma Blott and
Michael Rose
• Overland Corner Holdings Pty Limited: Emma
Blott and Michael Rose
• Beacon Automation Pty Limited: Emma Blott,
David Hazlehurst and Michael Rose
• Livestock Improvement Corporation (UK)
Limited: David Hazlehurst and Mark Ryder
• LIC Ireland Limited: David Hazlehurst and
Mark Ryder
• Livestock Improvement Automation Limited:
David Hazlehurst and Mark Ryder
• LIC Automation UK Limited: David Hazlehurst

During 2021/22 the Directors named below resigned from the boards of the Company’s subsidiaries
as follows:
• Andrea Black: resigned from Agrigate
GP Limited
• Simon O’Connor: resigned from Beacon
Automation Pty Limited, Livestock
Improvement Pty Limited, Farmkeeper Pty
Limited and Overland Corner Holdings
Pty Limited
•
• Wayne McNee: resigned from Livestock
Improvement (New Zealand) Corporation
Limited, LIC Automation Limited (now LIC
Ventures No.1 Limited), LIC Ventures No.3
Limited, Agrigate GP Limited, Livestock
Improvement Corporation (UK) Limited,
LIC Ireland Limited, Livestock Improvement
Automation Limited and LIC Automation
UK Limited
46 Livestock Improvement Corporation Consolidated Annual Report 2021/22

Entries in the interest register
A) Participation in the Company’s Contract Mating
Scheme could lead to the potential sale of bull
calves to LIC in the 2022/2023 season. Directors
participating in the scheme include:
B) Share Dealings by Directors
As at 31 May 2022 the Directors other than the
Appointed Directors (either in their own names
and/or in the name(s) of their dairy farming
entities) as qualifying users of LIC’s products
and services are holders of, or control the
exercise of the right to vote or the acquisition
or disposal of, the following shares:

Ordinary Shares include fully paid shares
which are quoted on the NZX and Nil Paid
Shares, which must be paid up over time by
Shareholders.
C) Loans to Directors of the Parent and Subsidiaries
There have been no loans during the year.
D) Directors Indemnity and Insurance
The Company has issued a Deed of
Indemnity and insured all its Directors and
Senior Managers against liabilities to third
parties for any acts or omissions in their
capacity as Directors of the Company and its
Related Parties.
E) Use of Company Information
There were no notices from Directors of
the Company requesting to use Company
Information received in their capacity as
Directors, which would not otherwise have
been available to them.
F) Participation in third party Firstlight
Wagyu scheme

During the year LIC operated a scheme in
co-ordination with Firstlight Wagyu (NZ) Ltd
wherein participants sold calves to LIC, as an
intermediary, for on-sale to Firstlight Wagyu
(NZ) Ltd. Directors participating in the scheme
during the year were as follows:
RESOLUTION OF DIRECTORS DATED 20 JULY 2022 CONFIRMING THE CO-OPERATIVE
STATUS OF LIVESTOCK IMPROVEMENT CORPORATION LIMITED
DirectorPotential Calf SalesPotential Value
Murray King1$14,000
Matt Ross21$294,000
DirectorCalf Sales Made to LIC
Gray Baldwin$208,142
Matt Ross$57,479
31 May 202231 May 2021
DirectorOrdinary SharesOrdinary Shares
Gray Baldwin14,27614,276
Ben Dickie*32,65023,922
Ken Hames **4,0003,204
Murray King ***136,704136,704
Matt Ross93,74493,744
Alison Watters33,57633,576
* Includes shares from participation in the Voluntary Investment Scheme and
shares compulsorily purchased to meet LIC’s Shareholding Requirements
** K Hames farming interests include Ahipara Agri Limited and includes shares
compulsorily purchased to meet LIC’s Shareholding Requirements
*** Includes 20,000 Ordinary Shares held by Callura Dairies Management
Limited, of which M King is Chair
RESOLVED THAT:
Livestock Improvement Corporation Limited
(Company) was registered as a Co-operative
Company under the provisions of the Co-operative
Companies Act 1996 (Act) on 1 March 2002.
In the opinion of the Board of Directors, the
Company has been a Co-operative Company from
that date to the end of the accounting year ended
31 May 2022.

The grounds for this opinion are:
1. The principal activity of the Company
involves supplying artificial breeding, herd
testing, herd recording and other services
to transacting Shareholders (as that term is
defined in section 4 of the Act). Accordingly,
the principal activity of the Company is, and is
stated in the Constitution of the Company as
being, a co-operative activity (as the term is
defined in section 3 of the Act); and
2. Not less than 60 percent of the voting rights
attached to shares in the Company are held
by transacting Shareholders.
Livestock Improvement Corporation Consolidated Annual Report 2021/22 47

Size of ShareholdingNumber of Shareholders* Shares Held% of Total
1 - 999720461,2760.31%
1,000 - 1,9999971,535,0711.04%
2,000 - 2,9998172,002,5381.36%
3,000 - 3,9996572,223,2791.51%
4,000 - 4,9997573,338,1932.26%
5,000 - 5,9994622,549,3061.73%
6,000 - 6,9994002,593,4661.76%
7,000 - 7,9993472,578,0041.75%
8,000 - 8,9993883,277,5022.22%
9,000 - 9,9992832,695,9241.83%
10,000 - 14,9991,08413,264,7138.98%
15,000 - 19,99972412,567,4078.51%
20,000 - 24,9994339,658,9676.54%
25,000 - 29,9993158,568,4845.80%
30,000 - 34,9992187,047,3734.77%
35,000 - 39,9991535,679,3123.85%
40,000 - 49,9992209,789,2686.63%
50,000 - 99,99927918,436,73212.48%
100,000 - 199,999557,378,6485.00%
200,000 - 299,999133,197,0582.16%
300,000 - 499,99962,323,6811.57%
500,000 - 999,99985,593,0353.79%
1,000,000 +920,923,18314.17%
9,345147,682,420100%
Spread of Shareholders as at 31 May 2022
(including treasury stock and nil paid shares)
* The number of shareholders above is based on the number of separate/individual farms. The table in relation to the twenty largest shareholdings,
amalgamates shareholders with multiple farms.
48 Livestock Improvement Corporation Consolidated Annual Report 2021/22

Credit Rating Status
LIC currently does not have a credit rating.
Substantial product holders
Based on the Company records and substantial
product holder notices provided, as at 31 May 2022,
the following parties were substantial product
holders of the Company:
The total number of quoted fully paid ordinary
shares in the Company was 133,136,908 as at
31 May 2022.
LIC understands that Peter James McBride’s
substantial product holder disclosure is in relation
to financial products held by Trinity Lands Limited
(7,308,089 fully paid ordinary shares), which is
also disclosed and Crocodile Farm Limited (5,343
fully paid ordinary shares). Peter James McBride’s
substantial product holding arises because he has
the power to exercise, or to control the exercise of,
a right to vote attached to the financial products
held by Trinity Lands Limited and Crocodile Farm
Limited and has the power to acquire or dispose
of, or to control the acquisition or disposal of, the
same financial products held by Trinity Lands
Limited and Crocodile Farm Limited.
ShareholderShares held% of total shares
Trinity Lands Limited 7,328,9134.96%
LIC Treasury Stock5,337,5843.61%
Schmidt Farms Limited 2,391,133 1.62%
Sim Brothers Limited 1,650,682 1.12%
Melrose Dairy Limited 1,600,087 1.08%
Anglesea Agriculture Limited 1,424,587 0.96%
David Lockhart Easton & Anthea Clare Easton & RFH Trustees1,261,080 0.85%
Kotare Pastoral Limited 978,858 0.66%
CIP Nominees No 1 Limited (LIC’s Employee Share Scheme)909,489 0.62%
Mark Braden Neil Dewdney, Anne Heather Dewdney & Victoria Ann Dewdney 774,308 0.52%
Christopher John Stark & Graham Carr 718,372 0.49%
Robert Laurentius Johannes Bruin & Annemarie Bruin 696,078 0.47%
Pilsen 2021 Limited616,9440.42%
Cayuga Limited588,7900.40%
D B Douglas Limited 582,756 0.39%
Mangatarata Farms Limited550,000 0.37%
Bishop Farms Oxford Limited474,5720.32%
Malrose Properties Limited 439,376 0.30%
JD & RD Wallace General Partnership Limited436,2200.30%
Landcorp Farming Limited 419,540 0.28%
29,179,369 19.76%
Twenty Largest Shareholdings as at 31 May 2022
(including treasury stock and nil paid shares)
Substantial
product
holders
Number of
quoted fully paid
ordinary shares in
substantial holding
at 31 May 2022
Percentage of
quoted fully paid
ordinary shares
in substantial
holding at
31 May 2022
Trinity Lands Ltd7,308,0895.4892%
Peter James
McBride
7,313,4325.4932%
Livestock Improvement Corporation Consolidated Annual Report 2021/22 49

LIC notes that the substantial product holders’
original notices to the market were provided on 19
September 2019. Shareholders are advised that
the change in the substantial holdings has not
been 1% or more subsequent movement (relative to
the number of quoted fully paid ordinary shares on
issue), which would otherwise require a disclosure
to the market pursuant to s277 of the Financial
Markets Conduct Act 2013. We have set out below,
for completeness, the disclosures made at the date
of the original notice (which are also available on
nzx.com under LIC’s announcements).
Donations
The Company made donations totaling $14,874
during the year ended 31 May 2022 (2021: $14,048).
No political contributions are made by the Company.
Non-Standard Listing
Livestock Improvement Corporation Limited has
been classified as a Non-Standard NZX Issuer
by the NZX, pursuant to NZX Listing Rule 1.18, by
reason of it being a Co-operative Company having
a Constitution which includes provisions having the
following effect:
The acquiring of Ordinary Shares is restricted
to New Zealand dairy farmers who derive an
income from the farming of dairy cows in New
Zealand, whose milk is supplied to a New Zealand
milk processor and who purchase qualifying
products and services from Livestock Improvement
Corporation Limited.

WAIVERS AND APPROVALS GRANTED BY NEW ZEALAND EXCHANGE LIMITED (“NZX”) IN THE PROCESS
OF THE APPROVAL OF THE CONSTITUTION OF LIVESTOCK IMPROVEMENT CORPORATION LIMITED
On 1 October 2020, NZX Regulation (NZXR) granted
waivers, rulings and approvals in respect of the
following NZX Listing Rules:

1. A Ruling that treats the “Shareholding
Requirement” as defined in LIC’s Constitution
as the "Minimum Holding" requirement for LIC
for the purposes of the Listing Rules.
2. A Ruling to the extent that the definition of
“Renounceable” refers to a Right or an offer
of securities by LIC that is transferrable to any
person entitled to hold those securities under
the Constitution. This reflects the ownership
restrictions on shares, resulting from the co-
operative nature of LIC.
3. A waiver in respect of Rules 2.3.1 and 2.3.2, to
allow for the following aspects of the Company’s
corporate governance structure:

a) Director nominations for Elected Directors
by Ordinary Shareholders to be restricted
by region, as set out in clause 22.4(b) of
the Constitution and qualification, as set
out in Schedule 3 of the Constitution;
b) the nomination procedures for Appointed
and Elected Directors (including casually
appointed directors) as set out in
Schedule 3 of the Constitution;
4. A waiver in respect of Rule 3.13.1 to allow LIC
to release to the NZX details of the Nil Paid
Shares that have been converted into Fully
Paid Shares on a monthly basis, in the form as
required under Rule 3.13.1, on the first business
day of each month, aggregating the number
of Nil Paid Shares that have been paid up (if
any) in the preceding month.
5. A waiver in respect of Rule 6.2.4 to allow Nil
Paid Ordinary Shares to carry full voting rights.
Without this waiver, the Nil Paid Shares could
only carry voting rights in proportion to which
the Share is paid up.
Substantial
product
holders
Number of
quoted fully paid
ordinary shares
in substantial
holding at date
of notice
Percentage of
quoted fully
paid ordinary
shares held at
date of notice
Date
of notice
Trinity Lands
Limited
7,328,9835.943%19/09/19
Peter James
McBride
7,329,577 5.943%19/09/19
50 Livestock Improvement Corporation Consolidated Annual Report 2021/22

6. A waiver in respect of Rule 6.6.1 to allow the
lien provision in clause 18 in the Constitution to
be read in place of this Rule.
7. An approval under Rule 8.1.6(b) to include the
following restrictions in the Constitution:
a) LIC is restricted in relation to the voting
securities that may be issued, as set out in
clause 3.2(b) of the Constitution, thereby
maintaining its co-operative structure;
b) ordinary shares in LIC may only be held by
or transferred to certain persons, as set out
in clause 3.2(c) of the Constitution;
c) ordinary shares in LIC shall not be held
or acquired for the benefit of any person
who is not a User, unless an exception is
provided, as set out in clause 3.2(d) of the
Constitution;
d) no person shall hold a relevant interest
in more than 5% of the total number of
ordinary shares in LIC on issue, as set out in
clause 6.3(a) of the Constitution;
e) LIC may require Users who have spent
in excess of the Minimum Purchase
Amount to compulsorily acquire sufficient
ordinary shares to meet the Shareholding
Requirement, as set out in clause 7.1 of the
Constitution;
f) LIC may require Users who no longer
spend the Minimum Purchase Amount
to compulsorily dispose of their ordinary
shares, as set out in clause 7.2 of the
Constitution; and
g) While the Dairy Industry Restructuring Act
2001 restricts voting rights in LIC, no person
can exercise, or control the exercise of,
more than 1% of the maximum number of
votes exercisable at any meeting of LIC, as
outlined at clause 20.4 of the Constitution.

On 31 August 2020, NZXR granted a waiver
from Rule 2.7.1 to allow LIC’s Elected Directors’
terms of tenure to be extended as set out in the
transitional arrangements in the 2020 LIC Notice
of Annual Meeting. The waiver is required to
streamline the implementation of the governance
changes as approved by shareholders at the
2020 LIC Annual Meeting.
On 30 August 2019, NZXR granted a waiver
from Rule 4.15.1 to allow LIC to provide financial
assistance to an Approved Holding Entity, for the
purposes of, or in connection with, the acquisition
of Equity Securities issued, or to be issued, under
the Voluntary Investment Scheme.
DISCLOSURE OF FINANCIAL
ASSISTANCE AS REQUIRED UNDER THE
COMPANIES ACT 1993
A) Dividend Reinvestment Plan:
LIC proposes to provide financial assistance to
those Shareholders who elect to participate in the
Dividend Reinvestment Plan ("Dividend Plan") by
agreeing to pay to the Guardian Trust Company
of New Zealand Limited ("Guardian Trust"), as
the Approved Holding Entity, the services and
administration fees and brokerage and commission
costs incurred for the purposes of the Dividend
Plan. Craigs Investment Partners Limited ("Craigs")
has been appointed as the Broker to purchase
Ordinary Shares on the NZX market for the
purposes of the Dividend Plan, and the moneys
paid by LIC to Guardian Trust as Approved Holding
Entity will include the administration fee, brokerage
and commission costs of Craigs.
LIC is required to make disclosures to all
Shareholders in respect of this financial assistance.
The exact amount of the net costs depends upon
the extent to which Shareholders participate in the
Dividend Plan. However, the total amount of net
costs in the next twelve months is estimated to be
in the region of $15,000.
In relation to the financial assistance provided
for the Dividend Plan, the LIC Board resolved on
20 July 2022 that LIC should provide the financial
assistance referred to above (“Dividend Plan
Financial Assistance”), for the period of 12 months
commencing 10 working days after sending this
disclosure to Shareholders, and that the giving of
Livestock Improvement Corporation Consolidated Annual Report 2021/22 51

the Dividend Plan Financial Assistance is in the best
interest of LIC and is of benefit to Shareholders
not receiving that financial assistance; and that
the terms and conditions under which the Dividend
Plan Financial Assistance is given are fair and
reasonable to LIC and to the Shareholders not
receiving that financial assistance. The grounds for
the Board’s conclusions are:
a) The Dividend Plan Financial Assistance
enables LIC to provide Shareholders with an
efficient means of acquiring additional Shares
in LIC without incurring transaction costs which
they would otherwise incur;
b) The Dividend Plan Financial Assistance is
available to all eligible Shareholders, giving
equal opportunity to participate in the benefits
of the Dividend Plan;
c) The additional Shares will be acquired by
Craigs through on-market transactions, by the
transfer of LIC shares held as treasury stock
and/or subscribing for new shares (on behalf
of the Shareholder).
d) Participating Shareholders will pay no greater
than the higher of:
i) the volume-weighted average price of
shares trading on the NZX market during
the 20 Business Days prior to the date that
the Board determines to issue shares from
treasury stock; and
ii) the average price paid by Craigs on
behalf of Participants for on-market
acquisitions.
e) The Dividend Plan will enhance the liquidity in
the market for the Shares, providing a more
liquid market for both participating and non-
participating Shareholders wishing to trade in
LIC Shares;
f) The Dividend Plan enables LIC to offer
Shareholders a mechanism to reinvest
dividends in Shares without resulting in
unnecessary new capital being raised through
the issue of new shares; and
g) The amount of Dividend Plan Financial
Assistance is minimal in comparison to the
benefits arising out of the Dividend Plan for
Shareholders and LIC.

B) Voluntary Investment Scheme:
LIC proposes to provide financial assistance
to those eligible Shareholders who elect to
participate in the Voluntary Investment Scheme
("Investment Scheme") by agreeing to pay to the
Guardian Trust Company of New Zealand Limited
("Guardian Trust"), as the Approved Holding
Entity, the services and administration fees and
brokerage and commission costs incurred for the
purposes of the Investment Scheme. Craigs has
been appointed as the Broker to purchase Ordinary
Shares on the NZX market for the purposes of the
Investment Scheme, and the moneys paid by LIC
to Guardian Trust as Approved Holding Entity will
include the administration fee, brokerage and
commission costs of Craigs.
LIC is required to make disclosures to all
Shareholders in respect of this financial
assistance. The exact costs depends upon the
extent to which eligible Shareholders participate
in the Investment Scheme. However, the total
costs in the next twelve months is estimated to be
in the region of $11,000.
In relation to the financial assistance provided for
the Investment Scheme, the LIC Board resolved on
20 July 2022 that LIC should provide the financial
assistance referred to above (“VIS Assistance”),
for the period of 12 months commencing 10
working days after sending this disclosure to
Shareholders, and that the giving of the VIS
Assistance is in the best interest of LIC and is of
benefit to Shareholders not receiving that financial
assistance; and that the terms and conditions
under which the VIS Assistance is given are fair
and reasonable to LIC and to the Shareholders not
receiving that financial assistance. The grounds for
the Board’s conclusions are:
a) The VIS Assistance enables LIC to provide
eligible shareholders with a means of
acquiring additional shares in LIC through
a fixed trading plan, given the risk they
will often be information insiders, without
incurring transaction costs which they would
otherwise incur;
b) The VIS Assistance is a method of aligning
of eligible shareholders with the interests of
Company by providing a legally compliant way
of acquiring LIC shares by individuals who may
often be information insiders;

52 Livestock Improvement Corporation Consolidated Annual Report 2021/22

c) The additional shares will be acquired by
Craigs either through on-market transactions
or from LIC (whether by way of a share
issuance or by the transfer of treasury stock).
d) Participating Shareholders will, as far as is
practicable, pay a uniform price in relation to
a season.
e) The Investment Scheme will enhance the
liquidity in the market for the shares, providing
a more liquid market for both participating
and non-participating Shareholders wishing to
trade in LIC shares; and
f) The Investment Scheme enables LIC to offer
eligible shareholders a mechanism to invest
in LIC shares without resulting in unnecessary
new capital being raised through the issue of
new shares.
C) LIC Employee Share Scheme:
LIC proposes to provide financial assistance to
those employees who elect to participate in the
LIC Employee Share Scheme (“Employee Scheme”)
which from the 1 April 2011 has been managed by
Craigs, with Custodial Services Limited acting as
custodian. LIC proposes to pay the Manager's
and Custodian's fees and expenses (including
brokerage). The amount of the fees will depend on
how many employees participate in the Employee
Scheme and the level of their contributions.
However, it is estimated that the total fees in the
next twelve months will be in the region of $22,000.
In relation to the financial assistance provided
for the Employee Scheme, the Board of LIC
resolved on 20 July 2022 that LIC should provide
the financial assistance referred to above
(“Employee Scheme Assistance”) for the period of
12 months commencing 10 working days after the
date of sending this disclosure to Shareholders,
and that the giving of the Employee Scheme
Assistance is in the best interests of LIC, and
is of benefit to Shareholders not receiving that
financial assistance; and that the terms and
conditions under which the Employee Scheme
Assistance is given are fair and reasonable, to
LIC, and to the Shareholders not receiving that
financial assistance. The grounds for the Board’s
conclusions are:

a) The Employee Scheme is a valuable addition
to the benefits available to the employees
of LIC and will assist in retaining them as
valuable staff;
b) The Employee Scheme is a method of aligning
the interests of employees with the interests
of Shareholders and is an effective means
of motivating future performance of the
employees;
c) Shareholders will not be diluted or otherwise
disadvantaged as no new Ordinary Shares are
being issued under the Employee Scheme;
d) The Employee Scheme will enhance the
liquidity in the market for the Shares, providing
a more liquid market for Shareholders wishing
to trade in LIC Shares;
e) The amount of financial assistance is minimal
in comparison to the benefits arising out of the
Employee Scheme for Shareholders and LIC.
Livestock Improvement Corporation Consolidated Annual Report 2021/22 53

605 Ruakura Road
Newstead 3286
Hamilton
New Zealand
07 856 0700 | lic.co.nz

---

Results announcement
20 July 2022

Results for announcement to the market
Name of issuer Livestock Improvement Corporation Limited
Reporting Period 12 months to 31 May 2022
Previous Reporting Period 12 months to 31 May 2021
Currency NZD
Amount (000s) Percentage change
Revenue from continuing
operations
$263,182 +5.69%
Total Revenue $264,234 -0.82%
Net profit/(loss) from
continuing operations
$10,623 -55.01%
Total net profit/(loss) $26,723 +16.47%
Interim/Final Dividend
Amount per Quoted Equity
Security
$0.18428206 per share
Imputed amount per Quoted
Equity Security
$0.07166525 per share
Record Date 5 August 2022
Dividend Payment Date 19 August 2022
Current period Prior comparable period
Net tangible assets per
Quoted Equity Security
$1.91 $1.86
A brief explanation of any of
the figures above necessary
to enable the figures to be
understood
The Net Tangible Assets per Quoted Equity Security excludes LIC ordinary
shares held as treasury stock and unquoted LIC Nil Paid shares which have
the same voting and dividend rights as LIC’s quoted ordinary shares.

Any dividends paid on LIC Nil Paid Shares and on any ordinary shares
required to be held to satisfy LIC’s share standard will be applied to repay
outstanding commitments on LIC Nil Paid Shares.
Authority for this announcement
Name of person

authorised
to make this announcement
Marise Winthrop
Contact person for this
announcement
Marise Winthrop
Contact phone number +64 27 488 4615
Contact email address Marise.Winthrop@lic.co.nz
Date of release through MAP

20 July 2022

Audited financial statements accompany this announcement.

---

Distribution Notice

20 July 2022

Section 1: Issuer information
Name of issuer Livestock Improvement Corporation Limited
Financial product name/description Final Dividend
NZX ticker code LIC
ISIN (If unknown, check on NZX
website)
NZLICE0001S1
Type of distribution
(Please mark with an X in the
relevant box/es)
Full Year X Quarterly
Half Year Special
DRP applies X
Record date 5 August 2022
Ex-Date (one business day before the
Record Date)
4 August 2022
Payment date (and allotment date for
DRP)
19 August 2022
Total monies associated with the
distribution
$26,231,600.00
Source of distribution (for example,
retained earnings)
Profit
Currency NZD
Section 2: Distribution amounts per financial product
Gross distribution $0.25594731 per share
Total cash distribution $0.18428206 per share
Excluded amount (applicable to listed
PIEs)
N/A
Supplementary distribution amount N/A
Section 3: Imputation credits and Resident Withholding Tax
Is the distribution imputed Fully imputed
If fully or partially imputed, please
state imputation rate as % applied
100%
Imputation tax credits per financial
product
$0.07166525 per share
Resident Withholding Tax per
financial product
$0.01279737 per share

Section 4: Distribution re-investment plan (if applicable)
DRP % discount (if any)
N/A
Start date and end date for
determining market price for DRP
22 August 2022 Not known – dependent on
the time it takes to acquire
the shares on market.
Date strike price to be announced (if
not available at this time)
Not known at this stage. The price of the share will be
determined when all shares have been acquired. The
strike price under the DRP is the volume-weighted
average price per share paid on-market in acquiring
shares to fulfil demand under the DRP for the relevant
period. The period for acquisitions to fulfil demand under
the DRP is from the date noted above until the date that
is 20 Business Days before the next Record Date
(“Acquisition Period”).
Specify source of financial products to
be issued under DRP programme
(new issue or to be bought on market)
Shares to be purchased on market
DRP strike price per financial product
The strike price under the DRP is the volume-weighted
average price per share paid on-market in acquiring
shares to fulfil demand under the DRP within the
Acquisition Period.
Last date to submit a participation
notice for this distribution in
accordance with DRP participation
terms
8 August 2022
Section 5: Authority for this announcement
Name of person

authorised to make
this announcement
Marise Winthrop
Contact person for this
announcement
Marise Winthrop
Contact phone number +64 27 488 4615
Contact email address Marise.Winthrop@lic.co.nz
Date of release through MAP

20 July 2022

=== WHISPER TRANSCRIPT (yt-dlp + OpenAI Whisper API) ===
Well this is my first result as the CEO of Livestock Improvement. It's a fantastic result for our farmers and the wider LIC team have put in a lot of work to get here and this really means that we can continue to deliver great services on farm and continue to drive faster rates of genetic gain for our farmers. We're really proud to deliver a strong financial result in line with our forecast. It also demonstrates our position as a strong cooperative delivering sustainable returns to our farmer shareholders. The results largely driven by the increased investment by our farmer shareholders particularly in our premium genetics products, the use of genomic sires and the use of more sex semen. It's also really pleasing to see that farmers are investing more heavily in some of the other products that we offer such as the Yonies test and the milk pregnancy testing. These are products which help farmers smarter and more efficiently. The use of young, genomically selected sires is really accelerating the rates of genetic gain and giving farms the ability to breed a better more superior cow Our cooperative members using LIC genetics have almost doubled the rate of genetic gain And this is fantastic because this really puts us at the forefront of what we trying to achieve Fantastic quality milk products from sustainable, high performing cows. I'd like to thank the team for the last 12 months and all of the hard work they've put in to deliver such great services to our farmers. I'm incredibly excited about the future and all of the research projects that we've got underway and that will deliver true sustainable advantage to our dairy industry. My focus for the year ahead is to really deliver on our three commitments, that's being operationally excellent and delivering on time, every time, having faster rates of genetic gain as we meet our environmental challenges around sustainability, methane output and nitrogen, as well as making sure our software products are fast, perform, are reliable and deliver the features that our farmers need. I really want to wish farmers all the very best for the rest of the season. The last season or so have been a challenge, but they really are in one of the best industries in the world.

NZX Notice pursuant to Listing Rule 3.13.1 NZX Notice pursuant to Listing Rule 3.13.1

Data sourced from publicly available filings. Our datasets may not be complete. Automated analysis can produce errors. If you believe any data on this page is incorrect, please contact us at hello@nzxplorer.co.nz. For informational purposes only. Not investment advice.

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