LIC 2023/24 Annual Report and Climate Statements

Livestock Improvement
Corporation Limited (LIC)
Annual Report
For the year ended 31 May 2024
There's always room for improvement

2 Livestock Improvement Corporation Consolidated Annual Report 2023/24

Contents
Key metrics 4
Directors' report 5
Key results and position 7
Our results for the year 7
Our position at year end 8
Our cash flows for the year 9
Changes in our position for the year 10
More details 11
Accounting policies 11
Business analysis 12
Our core assets 13
Our funding 17
Risk and Other Assets 18
Tax 19
Other Expenses and Other Liabilities 20
Transactions with Related Parties, Cash flow
reconciliation and Subsequent events 21
Independent auditor's report 22
Corporate Governance Report 26

71.7%
Net Profit After
Tax (NPAT)
$7.7m vs
$27.4m last year
3.3%
Total revenue

$267.3m vs
$276.5m last year
41.6%
Underlying
Earnings*
$13.9m vs
$23.7m last year
6.2%
Total assets



$358.6m vs
$382.3m last year
Key Metrics
Full year
dividend
Return
on equity
Final $8.3m –
5.84 cents per share
and Special $18.5m -
13 cents per share
vs $23.3m - 16.38
cents last year
2.8%
vs 9.2% last year
*Non-GAAP financial information
R&D, IT & capital
investment
$48.9m up 24.8%
(excluding sale of
National Milk Records
plc shares) from
$39.2m last year
Earnings
per share
NPAT 5 cents
and Underlying
Earnings* 10 cents
vs NPAT 19 cents and
Underlying Earnings*
17 cents last year
4 Livestock Improvement Corporation Consolidated Annual Report 2023/24

LIC ends the year with lower profit following challenging conditions
The LIC Board announces its financial result
for the 2023-24 financial year, ending the year
with no debt and a modest profit and dividend
for shareholders while continuing to invest in
innovations for shareholders.
The Board has declared a dividend of 5.84 cents
per share, returning $8.3 million to owners of the
co-operative. The dividend will be paid on 16
August 2024.
Summary of financials
• Total Revenue: $267.3 million, down 3.3% from
$276.5 million last year.
• Net Profit After Tax (NPAT): $7.7 million, down
71.7% from $27.4 million last year.
• Underlying Earnings: $13.9 million, down 41.6%
from $23.7 million last year.
• Dividend: $8.3 million – 5.84 cents per share,
representing 60% of Underlying Earnings.
This is in addition to the $18.5 million Special
Dividend paid earlier this year of 13 cents
per share.
• Total assets: $358.6 million, down 6.2% from
$382.3 million last year.
• Strong balance sheet with no debt
at year-end.

The Board notes that the 2023-24 financial year
has produced some difficult conditions for the
co-operative with a reduced milk price
environment, a subsequent reduction in activity
driving a lower bull valuation, ongoing cost
inflation, tax changes, and a semen quality issue
that resulted in over $2 million worth of credits
paid to farmers ($1.4 million impact on NPAT and
Underlying Earnings).
However, despite some very challenging
conditions, the Board is pleased to present a
positive result to our farmer shareholders, for the
seventh successive year.
Farmer shareholders are the heart of our
co-operative and it has been a particularly difficult
year for them with a lower milk price environment
alongside continuing high input and debt servicing
costs. The impacts of the lower milk price were felt
across New Zealand and are reflected in the 3.3%
reduction in revenue.
LIC is committed to our farmer shareholders and
we have continued to invest in research and
development, quality improvements in our semen
laboratories and technology innovation that will
benefit their businesses and the sector’s needs
now and into the future.

Directors' Report 2023 -24
Livestock Improvement Corporation Consolidated Annual Report 2023/24 5

Throughout the 2023-24 financial year the
organisation has identified cost savings to offset
reduced revenue and this has allowed the co-op
to still post a profit and pay out a dividend to its
shareholders, which is in addition to the $18.5m
Special Dividend paid earlier this year of 13 cents
per share.
Tax legislation enacted in March 2024 removed
the ability to depreciate commercial buildings for
tax purposes from the 2024-25 income tax year.
The application of this tax change created a
one-off, non-cash accounting adjustment to tax
expense at year end of approximately $4 million,
with a corresponding increase in LIC’s deferred tax
liability balance.
Research and development investments increased
by 14.2% to $21.2 million, representing 7.9% of
revenue. Investments include a methane research
trial focused on investigating the potential to breed
low methane-emitting cows in the future, as well
as a heat tolerance research programme which
involves breeding high genetic merit dairy cows
with improved heat tolerance.
The proportion of fresh semen straws used for
breeding replacement daughters on farm from
the premium bull teams increased to 79.4%
and target turnaround times were achieved
across GeneMark
®
, Johne’s Disease, and milk
pregnancy testing. Johne’s Disease testing saw
a 10% increase, with 1.28 million samples tested
during 2023-24.
LIC’s herd management system MINDA
®
saw
notable improvements during the period,
integrating with milk processors such as Fonterra
and Open Country as well as integrations with
wearable providers and OSPRI. This enables
seamless data-sharing and integration across
multiple applications used on farm. MINDA
®
is now
used by 90% of dairy farmers in New Zealand.
Outlook
The coming year still presents a difficult economic
environment with ongoing cost pressures on farm,
however LIC will continue to be firmly guided
by its primary focus of delivering on our three
commitments to farmer shareholders - operational
excellence, faster genetic improvement and
software reliability and performance. The
co-operative’s performance against these
commitments during the 2023-24 year will be
reported on at its Annual Meeting in September.
The co-op expects underlying earnings for 2024-25
to be in the range of $16-22 million, assuming no
significant events, including climate events, or milk
price change takes place between now and then.
6 Livestock Improvement Corporation Consolidated Annual Report 2023/24

STATEMENT OF RESULTS FOR THE YEAR
For the year ended 31 May 2024
In thousands of New Zealand dollars
Note20242023
Revenue1267,288 276,506
Purchased materials(41,255)(46,585)
People costs(119,758)(118,995)
Depreciation and amortisation3,4,5(24,047)(23,116)
Other expenses10(60,516)(56,855)
Net finance costs647 157
Bull team revaluation2(8,768)4,524
Fair value change in Nil Paid Share receivable6191 363
Profit/(loss) before tax expense13,782 35,999
Tax expense9(6,048)(8,647)
Profit/(loss) for the year7,73427,352
Profit per Ordinary Share (excl. treasury stock) $0.05 $0.19
Hedge revaluations6(251)113
Foreign currency translation movements625 (85)
Investment revaluations68,805 1,711
Land and buildings revaluations3,63,715 2,246
Tax effect of buildings revaluations9(784)(666)
11,510 3,319
Comprehensive income for the year 19,244 30,671
Supplementary non-GAAP note to the results for the year:
Profit/(loss) for the year7,734 27,352
Plus/(less): Bull team revaluation8,768 (4,524)
Tax effect on Bull team revaluation(2,455)1,267
Less: Fair value change in Nil Paid Share receivable(191)(363)
Underlying earnings13,856 23,732
Underlying earnings per Ordinary Share (excl. treasury stock) $0.10 $0.17
Key Results and Position
Livestock Improvement Corporation Consolidated Annual Report 2023/24 7

Key results and position

STATEMENT OF POSITION FOR THE YEAR
As at 31 May 2024
In thousands of New Zealand dollars
Note20242023
Cash42,341 54,596
Debtors834,952 37,628
Other assets826,557 35,892
Nil Paid Shares receivable6972 4,327
Bull team288,872 97,640
Land, buildings and equipment - owned & leased3,5118,997 113,547
Software, goodwill and other intangible assets445,917 38,661
Total assets358,608 382,291
Creditors723,831 23,505
Borrowings7- -
Deferred tax930,645 27,732
Other liabilities1129,221 33,560
Total liabilities83,697 84,797
Net assets274,911297,494
Share capital676,737 76,737
Retained earnings6150,567 170,742
Other reserves647,607 50,015
Total equity274,911 297,494
Director
Date: 18 July 2024
Director
Date: 18 July 2024
8 Livestock Improvement Corporation Consolidated Annual Report 2023/24

Key results and position
STATEMENT OF CASH FLOWS FOR THE YEAR
For the year ended 31 May 2024
In thousands of New Zealand dollars
Note20242023
Customer receipts264,919 276,609
Supplier payments(223,940)(236,542)
Net tax payments(2,189)(3,983)
Other operating cash flows1,262 707
Net operating cash flows1340,052 36,791
Software development(16,097)(9,611)
Net sales/(purchases) of land, buildings and equipment(11,570)(10,966)
Sale / (purchase) of investments819,030 (4)
Net investment cash flows(8,637)(20,581)
Payment of principal portion of lease liabilities(5,408)(4,319)
Drawdown/(repayment) of borrowings- -
Nil Paid Share receipts165 334
Dividends paid(38,446)(21,881)
Net financing cash flows(43,689)(25,866)
Movement in cash for year(12,274)(9,656)
Cash at beginning of the year54,596 64,135
Currency movement on cash holdings19 117
Cash at end of the year42,341 54,596
Livestock Improvement Corporation Consolidated Annual Report 2023/24 9

In thousands of New Zealand dollarsNoteShare capitalRetained earningsOther reserves Total equity
Balance at 1 June 202376,737 170,742 50,015 297,494
Profit/(loss) for the year- 7,734 - 7,734
Dividends paid- (41,827)- (41,827)
Hedge revaluations- - (251)(251)
Foreign currency translation movements- - 25 25
Investment revaluations- - 8,805 8,805
Land and buildings revaluations3,6- - 2,931 2,931
Reclassification of investment revaluations on
divestment
6- 13,918 (13,918)-
Balance at 31 May 202476,737 150,567 47,607 274,911
Balance at 1 June 202276,737 169,624 46,696 293,057
Profit/(loss) for the year- 27,352 - 27,352
Dividends paid- (26,234)- (26,234)
Hedge revaluations- - 113 113
Foreign currency translation movements- - (85)(85)
Investment revaluations- - 1,711 1,711
Land and buildings revaluations3,6- - 1,580 1,580
Balance at 31 May 202376,737 170,742 50,015 297,494
Key results and position

STATEMENT OF CHANGES IN POSITION FOR THE YEAR
For the year ended 31 May 2024
10 Livestock Improvement Corporation Consolidated Annual Report 2023/24

More Details
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 2024.
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
Accounting policies have been applied consistently
with prior periods.
vi. Climate risk
Climate change and how farmer shareholders, regulators
and others respond may have an impact on the Group’s
future revenue and the recognised amounts of assets
and liabilities. While the effects of climate change are a
continuing source of uncertainty, climate-related risks have
been assessed as not having a material impact on these
financial statements. Reviews of accounting estimates
(including the valuation of the bull team in Note 2, and
the valuation of land and buildings in Note 3), judgements
and impairment testing assumptions (refer to note 4) have
considered potential future impacts of climate change.
Accounting policies
Accounting entity
Livestock Improvement Corporation Consolidated Annual Report 2023/24 11

(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, animal recording and on-farm support for dairy 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
2024
NZ market
genetics
Herd
testing
Farm
software
DiagnosticsOtherEliminationsTotal
External revenue110,689 39,831 54,187 29,314 33,267 - 276,288
Inter-segment revenue- - - - 7,830 (7,830)-
Total revenue110,689 39,831 54,187 29,314 41,097 (7,830)276,288
Depreciation & amortisation(1,922)(5,790)(1,336)(3,548)(11,451)- (24,047)
Segment gross profit before tax70,686 19,877 41,422 13,193 11,164 -156,342
Bull team revaluation(8,768)
Unallocated amounts(133,792)
Profit/(loss) before tax expense13,782
2023
NZ market
genetics
Herd
testing*
Farm
software*
DiagnosticsOther*EliminationsTotal
External revenue113,467 40,009 52,622 29,067 41,251 - 276,506
Inter-segment revenue- - - - 5,706 (5,706)-
Total revenue113,467 40,00952,622 29,067 46,957 (5,706)276,506
Depreciation & amortisation(1,540)(5,835)(1,293)(3,528)(10,920)- (23,116)
Segment gross profit before tax72,815 20,575 39,416 13,208 17,263 - 163,277
Bull team revaluation4,524
Unallocated amounts(131,802)
Profit/(loss) before tax expense35,999
*During the current year an internal reorganisation transferred on-farm support between operating segments, 2023 numbers have been restated to
present comparatives on a consistent basis.
The Other segment includes international operations, research & development and support services. Unallocated amounts include
personnel costs, other expenses and net finance costs and are unallocated because the effort and cost involved to accurately
allocate these amounts to individual business segments would outweigh the benefit.
Notes to the Financial Statements
1. Business analysis
12 Livestock Improvement Corporation Consolidated Annual Report 2023/24

Notes to the Financial Statements
1. Business analysis (cont.)
Key drivers of the model:
Forecasted Fonterra Farmgate Milk Price*$8.25 - $8.85$8.25 - $9.00
WACC annualised post tax rate8.11% - 8.76%7.75% - 8.78%
Number of bulls in the team124128
Average % of run-off profile (years 2-5)42%43%
*This is the long term to short term Milk Price outlook.
(ii) Geographic analysis
In thousands of New Zealand dollars
2024
New ZealandAustraliaIrelandUKOtherTotal
Revenues248,420 8,999 3,545 2,337 3,987267,288
Non-current assets254,087 4,397 1,157 59 - 259,700
2023
Revenues254,001 10,186 3,605 2,724 5,990 276,506
Non-current assets253,959 4,756 1,060 9,425 - 269,200
2. Bull Team
The bull team is the cornerstone asset of LIC's genetics business. The 810 total bulls (2023: 915 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/(loss) for the year. 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 (revenue attributable) 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. During the period, LIC's United Kingdom subsidiary sold it's shareholding in National Milk Records Plc,
which significantly reduced Non-current assets for the United Kingdom region.
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
grants and R&D tax incentive income of $8.179 million (2023: $8.477 million).
In thousands of New Zealand dollars
20242023
Opening balance97,640 93,116
Bull team revaluation(8,768)4,524
Closing balance88,872 97,640
The impact on the fair value of a change to these key drivers is summarised
below:
Genomic run-off profile $5.6m - average of 5% shift across years 2-5
Impact on demand incorporating effect of changing the 2024 forecast Farmgate
Milk Price $2.75 decrease in the long term (2023: Impact on demand incorporating
effect of reducing the 2023 forecast Farmgate Milk Price by $2.00 in the long term)
$14.1m$17.9m
WACC moves 100 basis points$2.5m$2.9m
Livestock Improvement Corporation Consolidated Annual Report 2023/24 13

In thousands of New Zealand dollars
20242023
Land BuildingsEquipmentTotalLand BuildingsEquipmentTotal
Opening balance37,990 51,500 24,057 113,547 38,092 45,901 22,433 106,426
Additions- 4,852 7,331 12,183 35 4,484 7,574 12,093
Disposals- -(126)(126)- (663)(424)(1,087)
Depreciation- (3,048)(6,906)(9,954)- (2,503)(6,733)(9,236)
Revaluation743 2,650 - 3,393 (137)2,460 - 2,323
Foreign exchange- -(2)(2)- (3)(25)(28)
Leased assets movement - note 5- (253)209 (44)- 1,824 1,232 3,056
Closing balance38,733 55,701 24,563 118,997 37,990 51,500 24,057 113,547
Value if carried at cost11,726 23,135 N/A 11,726 21,331 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 as at April 2024. 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
20242023
Software & IP GoodwillDatabaseTotalSoftware & IP GoodwillDatabaseTotal
Opening balance25,798 2,363 10,500 38,661 25,760 2,348 10,500 38,608
Additions16,081 - - 16,081 9,646 - - 9,646
Disposals/impairment- - - - - - - -
Amortisation(8,842)- - (8,842)(9,557)- - (9,557)
Foreign exchange9 8 - 17 (51)15 - (36)
Closing balance33,046 2,371 10,500 45,917 25,798 2,363 10,500 38,661
14 Livestock Improvement Corporation Consolidated Annual Report 2023/24

Notes to the Financial Statements
4. Software and other intangibles (cont.)
In thousands of New Zealand dollars
20242023
NZ Market Genetics,
Farm software and
herd testing CGU
Other CGUTotal
NZ Market Genetics,
Farm software and
herd testing CGU
Other CGUTotal
LIC database10,500 - 10,500 10,500 - 10,500
Goodwill- 2,371 2,371 - 2,363 2,363
10,500 2,371 12,871 10,500 2,363 12,863
At reporting date, software includes $11.595 million (2023: $8.994 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 1.5% (2023: 1.0-2.0%) 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 8.7-10.9% for the LIC database and Other CGU Goodwill (2023: 8.3-10.4% for the LIC database and
Other CGU Goodwill).
(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 5.1% (2023: 4.9%).

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
Livestock Improvement Corporation Consolidated Annual Report 2023/24 15

Notes to the Financial Statements
5. Leases (cont.)
Lease liabilities
Set out below are the carrying amounts of lease liabilities recognised at 31 May (included in Other liabilities):
The Group had total non-variable cash outflows for leases of $6.086 million in 2024 ($4.868 million in 2023).
(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
20242023
Buildings EquipmentVehiclesTotalBuildings EquipmentVehiclesTotal
Opening Balance12,652 180 7,323 20,155 10,829 273 5,997 17,099
Depreciation(1,471)(142)(3,638)(5,251)(1,402)(96)(2,825)(4,323)
Additions1,420 347 3,871 5,638 3,322 3 4,389 7,714
Disposals/modifications(202)- (229)(431)(97)- (238)(335)
Closing balance12,399 385 7,327 20,111 12,652 180 7,323 20,155
Lease terms 2-28 years 2-5 years 2-8 years 2-28 years 2-5 years 2-7 years
In thousands of New Zealand dollars
20242023
Buildings EquipmentVehiclesTotalBuildings EquipmentVehiclesTotal
Within 1 year1,341 72 3,549 4,962 1,208 23 3,013 4,244
Between 1 to 5 years4,612 161 4,301 9,074 4,466 - 4,754 9,220
More than 5 years7,662 - - 7,662 8,004 - - 8,004
Closing balance13,615 233 7,850 21,698 13,678 23 7,767 21,468
In thousands of New Zealand dollars
20242023
Buildings EquipmentVehiclesTotalBuildings EquipmentVehiclesTotal
Depreciation1,471 142 3,638 5,251 1,402 96 2,825 4,323
Interest expense621 17 479 1,117 478 4 370 852
Variable lease payments- - 980 980 - - 1,123 1,123
Short-term and low-value leases- 1 - 1 - 9 - 9
Total amount 2,092 160 5,097 7,349 1,880 109 4,318 6,307
16 Livestock Improvement Corporation Consolidated Annual Report 2023/24

Notes to the Financial Statements
6. Funding
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
(2023: 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 $0.972 million (2023: $4.327 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 8.6% (2023: 8.0%).
(iv) Market capitalisation
As at 31 May 2024, the Group's market capitalisation of $172.365 million was below the carrying value of net assets of $274.911 million.
The share price is not considered an accurate reflection of the fair value of the Group's net assets for a number of reasons, including
the nature of the co-operative and its restricted capital structure. Accounting standards consider market capitalisation below net
assets to be an indicator of possible impairment and an impairment test has therefore been performed. The Group recoverable
amount has been determined using a value in use method similar to the impairment tests in Note 4. A discounted cash flow model has
been used based on Board approved budgets and a projection covering five years using a terminal growth rate of 1.5%. The discount
rate applied is reviewed and updated annually for movements in published Treasury risk-free rates and is 8.7%. The calculated
recoverable amount of the group was higher than the carrying value of the net assets, and therefore no impairment was recognised.
(v) Bank debt
Bank loans for seasonal funding requirements are secured by a Negative Pledge granted to Westpac and Rabobank over certain
New Zealand-based subsidiaries.
(iii) Other reserves and equity


In thousands of New Zealand dollars
Hedge
revaluation
reserve
Investment
revaluation
reserve
Land & building
revaluation reserve
Foreign currency
translation reserve
Other
reserves
Balance at 1 June 2023171 6,569 43,360 (85)50,015
Revaluations(251)8,805 2,931 25 11,510
Reclassification of investment revaluations
on divestment*
- (13,918)- - (13,918)
Balance at 31 May 2024(80)1,456 46,291 (60)47,607
Balance at 1 June 202258 4,858 41,780 - 46,696
Revaluations113 1,711 1,580 (85)3,319
Balance at 31 May 2023171 6,569 43,360 (85)50,015
*During the period, LIC sold it's shareholding in National Milk Records Plc for £9.019 million (NZD $18.963 million). Associated accumulated
revaluations have been reclassified from Other reserves to Retained earnings on divestment
.
Livestock Improvement Corporation Consolidated Annual Report 2023/24 17

Notes to the Financial Statements
7. Liquidity and interest rate risk
(i) Debtors
Bad debts of $0.020 million have been expensed during the year (2023: $0.007 million), and 87.8% of trade receivables are not past
due (2023: 90.3%).
(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 2024 was 7.3% (2023: 5.3%). A 1.0% increase in interest rates would increase interest paid and reduce
profit after tax by approximately $0.001 million (2023: $0.003 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 2025 and expects to be able to meet any obligations which fall due.
In thousands of New Zealand dollars
20242023
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- - - - - - - -
Creditors23,831 - - 23,831 23,505 - - 23,505
23,831 - - 23,831 23,505 - - 23,505
(ii) Other assets
Inventories utilised and expensed during the period amounted to $29.176 million (2023: $33.113 million). Inventories written off in 2024
totalled $0.095 million (2023: $0.038 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. Investments include Figured
Limited $3.358 million (2023: $4.207 million) and, in 2023, National Milk Records PLC which was sold during the period (2023:$9.319
million).
In thousands of New Zealand dollars
20242023
Inventories20,808 19,923
Investments4,941 15,027
Derivatives used for hedging- 164
Other livestock808 778
26,557 35,892
8. Debtors and other assets
18 Livestock Improvement Corporation Consolidated Annual Report 2023/24

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
In March 2024, legislation was enacted which removed the deductibility of depreciation on long-life commercial buildings for tax
purposes. At 31 May 2024, the impact of this change decreases the tax base for these assets, giving rise to an increased temporary
difference between the carrying cost and tax base and results in a one-off, non-cash, increase in both deferred tax liability and tax
expense of $3.643 million.
Given the Group's current turnover, and the lack of significant operations in foreign jurisdictions with tax rates below 15%, it does not
expect to be impacted by Pillar II tax reforms and the move towards global minimum tax rates of 15%.
LIC claims credits under the R&D Tax Incentive scheme. Claims include eligible core research expenditure and technology
development, as well as expenses that support R&D, and the credits are recorded as non-taxable revenue.
In thousands of New Zealand dollars
20242023
Profit/(loss) for the year7,734 27,352
Tax expense6,0488,647
Profit/(loss) before tax expense13,78235,999
Tax at 28% NZ company tax rate3,859 10,080
Effect of overseas income(34)(683)
Non-deductible items(521)(774)
Adjustments from prior periods(899)24
Impact of changes to building depreciation3,643 -
Tax expense6,048 8,647
Current tax expense3,919 7,843
Deferred tax expense2,129 804
Imputation credits available9,46819,006
In thousands of
New Zealand dollars
As at 31 May
2024
Through
Profit/(loss)
Through
Other reserves
As at
31 May 2023
Through
Profit/(loss)
Through
Other reserves
As at
31 May 2022
Bull team & livestock24,421 (2,414)- 26,835 1,168 - 25,667
Buildings & equipment
5,850 3,304 784 1,762 (212)666 1,308
Intangible assets
2,940 1,480 - 1,460 - - 1,460
Other
(2,566)(241)- (2,325)(152)- (2,173)
Total30,645 2,129 784 27,732 804 666 26,262
(ii) Deferred tax liability
Livestock Improvement Corporation Consolidated Annual Report 2023/24 19

Notes to the Financial Statements
10. Other expenses
Other expenses includes the following amounts paid to the Group's auditors, KPMG:
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 2024.
In thousands of New Zealand dollars
20242023
Provisions for employee entitlements7,596 9,340
Provision for sire proving rebate2,522 2,547
Derivatives used for hedging87 -
Provision for tax(3,259)(327)
Lease liabilities - current4,962 4,244
Lease liabilities - non-current16,736 17,224
Other577 532
29,221 33,560
11. Other liabilities
In thousands of New Zealand dollars
20242023
Research & Development Expenses21,215 18,577
As part of business activities, LIC incurs research and development expenses while working on a number of projects. Research and
Development expenses were previously disclosed separately on the face of the 'Statement of Results', however are now presented
here.
*Agreed upon procedures related to the R & D Tax Incentive scheme and disclosure of historical financial data in a sustainability report.
In thousands of New Zealand dollars20242023
Audit of the financial statements
222 210
Tax - compliance services for R&D Tax Incentive scheme
- 17
Agreed upon procedures*
24 24
Compilation of dataset of metrics
- 11
Total246 262
20 Livestock Improvement Corporation Consolidated Annual Report 2023/24

In thousands of New Zealand dollars
20242023
Remuneration of key Management and Directors 4,960 4,197
Sale of goods and services to key Management and Directors468597
Purchases of goods and services from key Management and Directors3 166
Notes to the Financial Statements
12. Transactions with Related Parties - Directors and Management
After 31 May 2024, a dividend of 5.84 cents per Ordinary Share was proposed by the Directors in relation to the 2024 year, or
$8.314 million (2023: 16.38 cents per Ordinary Share, or $23.323 million).
14. Subsequent events
Directors of the Company and their related entities hold 378,001 Ordinary Shares, representing 0.26% of shares on issue (2023: 375,359
Ordinary Shares, representing 0.25%).
There are no loans or deposits with related entities outside of the consolidated Group.
The Group has had the following short-term transactions with key Management and Directors during the year:
13. Reconciliation of the Profit/(loss) for the year to Net operating cash flows
In thousands of New Zealand dollars
20242023
Profit/(loss) for the year7,734 27,352
Adjusted for:
Depreciation and amortisation on all assets24,047 23,116
Bull team revaluation8,768 (4,524)
Deferred tax expense2,129 804
Working capital movements and other non-cash items(2,626)(9,957)
Net operating cash flows40,05236,791
Livestock Improvement Corporation Consolidated Annual Report 2023/24 21

Independent Auditor’s Report
To the shareholders of Livestock Improvement Corporation
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 7 to 21 present fairly, in all material respects:
i.the Group’s financial position as at 31 May 2024
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 issued
by the New Zealand Accounting Standards Board
and International Financial Reporting Standards
issued by the International Accounting Standards
Board.
We have audited the accompanying consolidated
financial statements which comprise:
— the consolidated statement of position as at 31
May 2024;
— the consolidated statements of results, changes
in position and cash flows for the year ended;
and
— notes, including material accounting policy
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 agreed upon procedure engagements over the
research and development tax credit and the disclosure of historical financial data in a sustainability report.
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 $1,490,000 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.
© 2024
KPMG, a New Zealand Partnership and a member firm of the KPMG global organization of independent member firms affiliated with KPMG International Limited, a private English
company limited by guarantee. All r ights reserved.

22 LLiivveessttoocckk IImmpprroovveemmeenntt CCoorrppoorraattiioonn Financial Statements 2023/24
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 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 utilised our valuation specialists to review market and industry data
to assess management’s discount rate applied to the valuation model.
We assessed the runoff profile of the bulls against historical data and
found the inputs to be comparable.
We considered the adequacy of the related financial statement
disclosures.
We had no matters to report as a result of our procedures
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.
The two significant cash generating
units (CGUs) holding these assets
are tested twice a year for
impairment using discounted
cashflow models to determine the
recoverable amount.
The market capitalisation deficit that
exists at balance date is an indicator
of impairment at a Group level and
has therefore been tested for
impairment using a discounted
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 and the Group. 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 the Group; and
‒ Performing sensitivity analysis around the key assumptions used in
the model.
Our testing supported management’s conclusion that there is no
impairment.
LLiivveessttoocckk IImmpprroovveemmeenntt CCoorrppoorraattiioonn Financial Statements 2023/24 23

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 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 utilised our valuation specialists to review market and industry data
to assess management’s discount rate applied to the valuation model.
We assessed the runoff profile of the bulls against historical data and
found the inputs to be comparable.
We considered the adequacy of the related financial statement
disclosures.
We had no matters to report as a result of our procedures
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.
The two significant cash generating
units (CGUs) holding these assets
are tested twice a year for
impairment using discounted
cashflow models to determine the
recoverable amount.
The market capitalisation deficit that
exists at balance date is an indicator
of impairment at a Group level and
has therefore been tested for
impairment using a discounted
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 and the Group. 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 the Group; and
‒ Performing sensitivity analysis around the key assumptions used in
the model.
Our testing supported management’s conclusion that there is no
impairment.
LLiivveessttoocckk IImmpprroovveemmeenntt CCoorrppoorraattiioonn Financial Statements 2023/24 23
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 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 utilised our valuation specialists to review market and industry data
to assess management’s discount rate applied to the valuation model.
We assessed the runoff profile of the bulls against historical data and
found the inputs to be comparable.
We considered the adequacy of the related financial statement
disclosures.
We had no matters to report as a result of our procedures
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.
The two significant cash generating
units (CGUs) holding these assets
are tested twice a year for
impairment using discounted
cashflow models to determine the
recoverable amount.
The market capitalisation deficit that
exists at balance date is an indicator
of impairment at a Group level and
has therefore been tested for
impairment using a discounted
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 and the Group. 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 the Group; and
‒ Performing sensitivity analysis around the key assumptions used in
the model.
Our testing supported management’s conclusion that there is no
impairment.
LLiivveessttoocckk IImmpprroovveemmeenntt CCoorrppoorraattiioonn Financial Statements 2023/24 23
Livestock Improvement Corporation Consolidated Annual Report 2023/24 23

The key audit matter How the matter was addressed in our audit
cashflow model to determine the
recoverable amount of the Group.
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 and the Group, including
considering future economic and
market conditions.
Other information
The Directors, on behalf of the Group, are responsible for the other information included in the entity’s Financial
statements. Other information includes the Key Metrics and the Directors 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 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 issued by the New Zealand
Accounting Standards Board;
— implementing necessary internal control to enable the preparation of a consolidated set of financial
statements that is free from material misstatement, whether due to fraud or error; and
24

LLiivveessttoocckk IImmpprroovveemmeenntt CCoorrppoorraattiioonn Financial Statements 2023/24
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 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 utilised our valuation specialists to review market and industry data
to assess management’s discount rate applied to the valuation model.
We assessed the runoff profile of the bulls against historical data and
found the inputs to be comparable.
We considered the adequacy of the related financial statement
disclosures.
We had no matters to report as a result of our procedures
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.
The two significant cash generating
units (CGUs) holding these assets
are tested twice a year for
impairment using discounted
cashflow models to determine the
recoverable amount.
The market capitalisation deficit that
exists at balance date is an indicator
of impairment at a Group level and
has therefore been tested for
impairment using a discounted
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 and the Group. 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 the Group; and
‒ Performing sensitivity analysis around the key assumptions used in
the model.
Our testing supported management’s conclusion that there is no
impairment.
LLiivveessttoocckk IImmpprroovveemmeenntt CCoorrppoorraattiioonn Financial Statements 2023/24 23
24 Livestock Improvement Corporation Consolidated Annual Report 2023/24

— 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 company
and group financial statements
Our objective is:
— to obtain reasonable assurance about whether the 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.
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
KPMG
Hamilton
18
th
July 2024
LLiivveessttoocckk IImmpprroovveemmeenntt CCoorrppoorraattiioonn Financial Statements 2023/24 25
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 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 utilised our valuation specialists to review market and industry data
to assess management’s discount rate applied to the valuation model.
We assessed the runoff profile of the bulls against historical data and
found the inputs to be comparable.
We considered the adequacy of the related financial statement
disclosures.
We had no matters to report as a result of our procedures
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.
The two significant cash generating
units (CGUs) holding these assets
are tested twice a year for
impairment using discounted
cashflow models to determine the
recoverable amount.
The market capitalisation deficit that
exists at balance date is an indicator
of impairment at a Group level and
has therefore been tested for
impairment using a discounted
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 and the Group. 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 the Group; and
‒ Performing sensitivity analysis around the key assumptions used in
the model.
Our testing supported management’s conclusion that there is no
impairment.
LLiivveessttoocckk IImmpprroovveemmeenntt CCoorrppoorraattiioonn Financial Statements 2023/24 23
Livestock Improvement Corporation Consolidated Annual Report 2023/24 25

Corporate Governance Report
On LIC's website (lic.co.nz/shareholders/corporategovernance) you will find the following corporate
governance documents:
Our latest Sustainability Report can also be accessed on LIC’s website at:
lic.co.nz/about/environment-and-sustainability/sustainability
• Constitution
Charters
• LIC Board Charter
• Audit, Finance & Risk Committee Charter
• People and Culture 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, Equity and Inclusion Policy
• Dividend Policy
• External Auditor Independence Policy
• Honoraria Committee Terms of Reference
• Shareholder Reference Group Terms
of Reference
• Share Trading and Disclosure Policy
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) and it is a Climate Reporting Entity (as defined under The Financial Sector
(Climate-related Disclosures and Other Matters) Amendment Act 2021). LIC’s first Climate Statements for
the year ended 31 May 2024 can be accessed on LIC’s website at:
lic.co.nz/about/environment-and-sustainability/climate-disclosure-reporting/
In this section of the Annual Report we report
against the Principles and Recommendations of
the NZX Corporate Governance Code dated 1
April 2023 (the NZX Code) and the extent that LIC
has followed the NZX Code’s recommendations.
LIC has a high degree of compliance with the NZX
Code. This statement is current to 31 May 2024
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, diagnostic and animal
health testing and herd testing services in the
New Zealand dairy sector, the control and
maintenance of the LIC database and the
execution of research relating to dairy herd
improvement.
26 Livestock Improvement Corporation Consolidated Annual Report 2023/24

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 “User Controlled” meaning
that eligible Users of the Company’s qualifying
products and services hold 60% or more of its
voting rights;
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, Ethical Standards: 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 (the Code) sets
out the ethical and behaviour standards expected
of Directors and employees of LIC. The Code is
reviewed biennially (or as required) to keep it up
to date with employee, shareholder and other
stakeholder expectations. New Directors and
employees receive training on the Code as part of
their induction process. 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.
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.



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.
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.
Livestock Improvement Corporation Consolidated Annual Report 2023/24 27

The exemption ensures that LIC Directors and
employees can comply with the Company’s
constitutional and co-operative requirements and
the Rules of its Employee Share Scheme without
technically infringing the insider trading provisions
of the FMC Act.
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 responsibilities
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 and distinguishes the
Board and Management's respective 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.
LIC’s business strategy and purpose is 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
focussing on the following:
28 Livestock Improvement Corporation Consolidated Annual Report 2023/24

The Board is also responsible for approval of
significant expenditures, policy determination,
selection of Appointed Directors, oversight of risk
(including climate-related risks and opportunities
and setting risk appetite for all risk categories)
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 LIC Constitution 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: Corrigan Sowman (Chair),
Ben Dickie, Duncan Coull, Matt Ross, Victoria
Trayner 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, can be found
on the LIC website. See also page 35 for further
information about the Company’s Diversity, Equity
and Inclusion policy.
Full details of the strategy, including the measures for each of these commitments, are available on LIC’s
website at lic.co.nz/about/our-strategy
LIC’s strategy makes three commitments to farmers:
Operational
Excellence
We commit to getting the
basics right and delivering for
you, on time, every time.
Faster Genetic
Improvement

We commit to having your
back when it comes to helping
you meet the environmental
challenges you face, in
particular animal efficiency,
and nitrogen and methane
mitigation.
Software Reliability
and Performance

We commit to being better at
delivering our software to you.
We renew our commitment to
continuous improvement and
transparency around delivery of
new features.
123
Livestock Improvement Corporation Consolidated Annual Report 2023/24 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 of that director’s tenure will be in
accordance with the Rotation Schedule.
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
Directors have entered into written agreements
setting out the terms of their engagement and all
new Directors will also do so.
In relation to the nomination and appointment of
Directors, appropriate checks are undertaken by
an external party, Propero Consulting Limited. The
process 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.
Sophie Haslem was due to retire by rotation in
October 2023 and sought re-appointment. Her
appointment as an Appointed Director was ratified
by shareholders at the 2023 Annual Meeting for a
further term of approximately three years.
In this year’s Director elections, North Island
Director Alison Watters and South Island Director
Matt Ross are due to retire by rotation at the
Annual Meeting. Matt Ross has decided, after
seven years on the LIC Board, to not seek re-
election. Alison Watters has decided, after ten
years on the LIC board, to also not seek re-election.
Alison Watters and Matt Ross will be replaced
by nominated Shareholders that are elected by
Shareholders. The elections are timed to coincide
with the 2024 Annual Meeting.
Appointed Director, Candace Kinser is due to
retire by rotation in October 2024. After nine years
on the LIC Board, she has decided to not seek
re-appointment. The Board is seeking a nominee
for the Appointed Director position who has the
requisite skill set.
Meetings
The Board met eight times in 2023/24 with two
additional strategy days.
30 Livestock Improvement Corporation Consolidated Annual Report 2023/24

Board Attendance:
Board Meetings
Special
Board Meetings
Board Strategy Days
No of meetingsHeldAttendedHeld AttendedHeldAttended
Ben Dickie871122
Tim Gibson871121
Ken Hames*83--2-
Sophie Haslem881122
Murray King*83--2-
Candace Kinser 881122
Matt Ross881122
Corrigan Sowman 881122
Alison Watters871121
Duncan Coull**851121
Victoria Trayner**851-21
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 sector. Directors also undertake in-market
and stakeholder visits.
The Chair revises development plans for each of
the Directors annually. These plans specifically
focus on areas that will not only develop the
individual Director but will also enhance overall
Board capability. 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 last engaged in 2023
and undertook a pulse check evaluation of
the performance of the Board. The evaluation
provided the Board with additional support
as part of transitioning to a new Chair and
also highlighted the continued improvement
in communication between the Board and
Senior Leadership Team to support strong
decision making.
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.
While all 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.
*retired at the 2023 Annual Meeting
**elected at the 2023 Annual Meeting
Livestock Improvement Corporation Consolidated Annual Report 2023/24 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:
All 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 2023/24.
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. For the avoidance
of doubt, the positions of Company Chair and CE
are currently held by two separate individuals.
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.
As at 1 June 2023Murray King, Ben Dickie,
Matt Ross and Corrigan Sowman
As at 1 December 2023Ben Dickie, Victoria Trayner
and Corrigan Sowman
32 Livestock Improvement Corporation Consolidated Annual Report 2023/24

People and Culture Committee
A Sub-Committee of the Board, the People
and Culture Committee (formerly known as 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:
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 2023/24. For completeness,
the Company does not have a nomination
committee as recommendations and decisions
relating to Director appointments are made by
the full Board as outlined on page 30.
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 Disclosure 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 Disclosure
Committee is chaired by Board Chair Corrigan
Sowman 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
met twice in 2023/24.
As at 1 June 2023Murray King, Ken Hames
and Alison Watters
As at 1 December 2023Corrigan Sowman, Matt Ross,
Duncan Coull and Alison Watters
Livestock Improvement Corporation Consolidated Annual Report 2023/24 33

Takeovers
Due to LIC’s co-operative company status, its
Constitution and the Dairy Industry Restructuring
Act 2001 (DIRA) based shareholding restrictions,
LIC considers 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.
Board Committee attendance:
Audit, Finance & Risk CommitteePeople and Culture Committee
Disclosure Committee
Number of meetingsHeldAttendedHeldAttendedHeldAttended
Ben Dickie66
Tim Gibson43
Ken Hames* 41
Sophie Haslem6622
Murray King*624122
Candace Kinser
Matt Ross***6343
Corrigan Sowman***664322
Alison Watters44
Duncan Coull**43
Victoria Trayner**63
*retired at the 2023 Annual Meeting
**elected at the 2023 Annual Meeting
***meetings attended impacted by a change to committee memberships on 1 December 2023
34 Livestock Improvement Corporation Consolidated Annual Report 2023/24

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
LIC’s annual sustainability report is prepared in
accordance with the core option of the Global
Reporting Initiative (GRI) Standards and in
line with our commitments as members of the
Climate Leaders Coalition and the Sustainable
Business Council.
LIC’s first climate statement reporting period is for
the year ended 31 May 2024.

Diversity, Equity 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, Equity and Inclusion Policy is available
on LIC's website at lic.co.nz/shareholders/
corporategovernance.
As at the 2023/24 year-end, members of the
Board and Senior Leadership Team self-identified
as follows:


The Diversity, Equity & Inclusion Committee aims
to foster a workplace culture that values and
promotes diversity, equity and inclusion.
For 2023/24 the Committee focused on:
• Implementation of a Te Ao Māori Strategy and
• Establishment of a Women in Leadership Group
Te Ao Māori Strategy:
With the partnership of Tira (formerly Tutira
Mai), the Te Ao Māori (Te Whakapiki) Strategy
has been finalised. The strategy will be
embedded into LIC over the next few years.
Women in Leadership Group:
This group has been set up with the aim
of fostering a community of women and
empowering them to become leaders in their
respective fields. The group seeks to build
strong connections across various industries,
and to provide mentorship and development
advice from experts with diverse backgrounds
and skill sets.
20242023
MFGDMFGD
LIC Board
54-63-
LIC Senior
Leadership
Team
53-62-
Key: M = Male / F = Female / GD = Gender Diverse
Livestock Improvement Corporation Consolidated Annual Report 2023/24 35

NZX Code Principle 5, Remuneration: The remuneration of directors and executives
should be transparent, fair and reasonable.
In thousands of New Zealand dollars
BoardAFRCP & C TA B
Total
Fees
Murray King*4848
Corrigan Sowman113113
Ben Dickie6363
Tim Gibson631376
Ken Hames*2222
Sophie Haslem632083
Candace Kinser 631376
Matt Ross6363
Alison Watters6363
Duncan Coull**4141
Victoria Trayner**4141
689
*retired at the 2023 Annual Meeting
**elected at the 2023 Annual Meeting
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, equity 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, equity 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.
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 $723,000 for all nine
Directors was approved at the meeting held in
October 2023.
Directors of the Company received the following
remuneration for the twelve months ending
31 May 2024:
36 Livestock Improvement Corporation Consolidated Annual Report 2023/24

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 with any further actual and reasonable
expenses incurred while on LIC business also
reimbursed. 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.
No 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
Chief Executive (CE) David Chin’s remuneration
package is made up of a combination of base
salary and annual performance payments. His
performance is assessed based on a range of
factors including:
• Overall financial performance (40%): delivery
of the annual plan and financial budget
• Overall strategic performance (60%), including:
• Staff engagement and culture
• Customer and operational delivery
(delivery of the 3 commitments and achieve
continuous improvements in customer Net
Promotor Score)
• Delivery of strategy and key projects
The remuneration paid to LIC’s CE for the year
ending 31 May 2024 is set out below:
The CE’s current remuneration package consists
of $521,000 TPV and short-term incentive target
of achieving both budget goals and other
standard objectives (20% of TPV) as well as stretch
objectives in relation to strategy (20% of TPV)
and does not include any long-term incentives or
share options.
In thousands of New Zealand dollars
Base Salary (TPV)521
2022/23 year short-term incentive payment received153
Total674
Livestock Improvement Corporation Consolidated Annual Report 2023/24 37

Remuneration Range (Gross)Current EmployeesExited EmployeesTotal
100,000 – 109,999 71 2 73
110,000 – 119,999 63 10 73
120,000 – 129,999 48 2 50
130,000 – 139,999 31 - 31
140,000 – 149,999 30 1 31
150,000 – 159,999 20 - 20
160,000 – 169,999 20 1 21
170,000 – 179,999 13 - 13
180,000 – 189,999 6 1 7
190,000 – 199,999 6 - 6
200,000 – 209,999 3 - 3
210,000 – 219,999 2 - 2
220,000 – 229,999 3 - 3
230,000 – 239,999 6 - 6
240,000 – 249,999 3 - 3
250,000 – 259,999 2 - 2
260,000 - 269,999 3 - 3
270,000 - 279,999 4 - 4
280,000 - 289,999 1 - 1
290,000 - 299,999 1 - 1
310,000 - 319,999 - 1 1
360,000 – 369,999 1 1 2
400,000 – 409,999 2 - 2
430,000 – 439,999 1 - 1
460,000 - 469,999 1 - 1
560,000 – 569,999 1 - 1
670,000 – 679,999 1 - 1
34319362
LIC has a transparent Remuneration Policy for all employees, which is approved by the People and Culture
Committee. This is an internal policy but available to all 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 and are paid in the following period. During the period 1 June 2023 to 31
May 2024 the following numbers of employees (not being Directors) received total remuneration, including
benefits and short term incentives relating to the 2022/23 year, of at least $100,000:
Employee Remuneration
38 Livestock Improvement Corporation Consolidated Annual Report 2023/24

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.
Biosecurity & Animal Health
A biosecurity or animal health event
impacts LIC’s livestock or its ability to
provide products or services to
its customers.
Information Security
The availability, integrity or confidentiality of
information managed by LIC is compromised
due to a malicious or unintentional
information security incident.
Brand Damage
Continued short-term reputational
damage results in damage to LIC’s brand.
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.
Compliance
Breaches of laws, regulations, licences,
standards, NZX continuous disclosure
requirements or Overseas Market Access
Requirements result in restrictions,
penalties, or loss.
People & Capability
Availability, capability and engagement of
our people and key vendors to effectively
execute LIC's strategic plan.
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.
Strategic Risk
An inability to deliver LIC’s agreed strategy
due to disruption, planning, risk, resourcing
and other barriers not identified or managed.
Market Disruption
The inability to commercialise innovations
or respond quickly to market disruption or
emerging technologies causes reduced
use by Shareholders of existing products or
services with a resultant reduction in revenue.
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 organisation.
Managing Risk
LIC has a risk management framework in place
to support the identification, quantification and
management of risk. LIC’s risk management
framework fosters improved ownership of risk
identification and management across all levels of
the business and an online risk tool supports this
occurring in real time. Key risk indicators provide
management with early warning of any risks
requiring increased focus. LIC’s risk ratings against
appetite are 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 controls reviewed
periodically by the Senior Leadership Team and the
Audit, Finance & Risk Committee.
LIC’s risk categories are:
Livestock Improvement Corporation Consolidated Annual Report 2023/24 39

Of particular interest to Shareholders and
stakeholders will be 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 into
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.
LIC has identified eleven critical health and safety
risks: high-risk hazards we believe have a high
likelihood of causing death or life-changing injuries
if uncontrolled. These are:
• Driving cars and trucks (on national roads)
• Quad bikes
• Farm vehicles
• Workplace stress and fatigue
• Zoonosis
• Asbestos
• Liquid Nitrogen
• Working at heights
• Agrichemicals
• Animal handling
• Working alone and/or remotely
Regular reporting to the Senior Leadership Team
and the Board provides assurance that LIC’s health
and safety system is operating effectively. Directors
and senior leaders are required to spend time each
year confirming for themselves that critical risk
controls are in place and operating as expected.
Business units have health and safety
representatives and there is a quarterly formal
governance forum chaired by LIC’s CE. Each
business unit is also required to develop a bespoke
health and safety plan to continually improve
health and safety management in their area.
Progress against these plans is reviewed at the
Health and Safety Governance Forum meeting.
LIC uses the Lost Time Injury Frequency Rate (LTIFR)
as its main safety metric. The LTIFR is not LIC’s sole
safety measure – it complements a range of other
leading and lagging safety measures, which are
regularly reported to the Senior Leadership Team
and the Board.
As can be seen from the table above, the
LTIFR increased slightly since 2022/23. LIC also
reported two notifiable events to Worksafe NZ.
These incidents were internally comprehensively
investigated and corrective actions implemented.
Worksafe NZ chose not to investigate the
incidents further.
Other performance indicators showed that
overall event reporting increased. The increase in
reporting was the result of a significant increase
in ‘near-miss’ reporting. Fewer incidents resulting
in injury were reported in 2023/24 than in previous
years. The number of critical risk-related incidents
also continued to track down following the focus
and investment into improving critical risk controls
and increasing the involvement of frontline staff in
control design.
In 2023/24 we focused on:
• Implementing health and safety objectives
within all business units, focussing on their
unique risks to enable ongoing improvement.
• Improving near-miss reporting, timely
completion of event investigations and
improvement actions through training and
enhancements to our reporting system.
• Providing all Health and Safety representatives
with the opportunity to receive additional
training to enhance their health and safety
knowledge.
• Improving the quality of consultative critical
risk control reviews.
• Improving our understanding of hazardous
substance exposure and confined space
management.
• Improving traffic management on several sites.
• Improving SHELTA user experience, LIC’s
electronic health and safety management
platform, available on all LIC devices.
2023/242022/23
LTIFR (200,000 h)2.352.23
Notifiable Events21
40 Livestock Improvement Corporation Consolidated Annual Report 2023/24

LIC has also started a review of ‘violence and
threatening behaviour’ risk following several
adverse experiences by staff while providing
services to customers. This is unacceptable and
additional controls are currently being developed.
A full review of health and safety representation is
also currently underway.
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 bull 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.
A Crisis Management Framework is in place,
supported by defined key roles and alternates
and business continuance plans, and these are
reviewed and tested regularly including an annual
crisis simulation exercise.

Information security
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 (including for
cyber attacks), reviewed regularly and backups
are performed regularly to support LIC’s recovery
should it be needed. LIC regularly undertakes
phishing simulations and training to assess staff
preparedness and vigilance.

Financial Risk
LIC has stringent processes in place to ensure
budgets, forecasts and financial reporting are
accurate and timely. LIC maintains internal controls
to manage delegated authority and remove the
opportunity for fraudulent activity through the
segregation of duties.
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.

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 2023/24 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.
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 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 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. Off-shore business activity
also provides a buffer for NZ-specific impacts.
Climate
Climate risk is a sub-category risk in LIC’s risk
management tool as it impacts more than one of
LIC's key risk areas. LIC has identified transition
and physical risks related to climate change.
LIC is a member of the Climate Leaders Coalition
and the Sustainable Business Council. LIC
measures and publicly reports our greenhouse
gas emissions, has set science-aligned emissions
reduction targets, and works with our staff and
suppliers to build 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. The Resilient Dairy programme is an
example of our commitment to long-term future
improvement.
42 Livestock Improvement Corporation Consolidated Annual Report 2023/24

NZX Code Principle 7, Auditors: The Board should ensure the quality and independence
of the external audit process.
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.
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 Wednesday 18
September at 4pm at LIC Newstead, Hamilton
and online (lic.co.nz/annualmeeting). LIC
welcomes Shareholders' attendance either on-
line or in person. A Notice of Meeting was sent to
Shareholders in early August 2024.
External Audit
LIC has an External Auditor Independence Policy
that requires the external auditor to be independent
and to be seen as independent. This policy can be
found on the LIC website. The Board is satisfied that
there is no relationship between the Auditor and
LIC or any related person at this time that 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 that we are fully compliant with. LIC’s
external auditor attends its Annual 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 internal audit or review
issues and incidents, improvements and changes
to internal controls.
Livestock Improvement Corporation Consolidated Annual Report 2023/24 43

Benjamin John Dickie:
Director of:
• Taranaki Veterinary Centre Limited
Timothy Dunlop Gibson:
Director of:
• The Equanut Company Limited
• Omnieye Holdings Limited (Ceased 13 August 2023)
• Port Otago Limited and subsidiaries:
• Chalmers Properties Limited
• Fiordland Pilot Services Limited
• Port Chalmers Container Terminal 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
• The Skills Organisation Incorporated
• Tūhana Business & Human Rights Limited
• Tūhana Consulting Limited
Sophie Haslem:
Director of:
• Centreport Limited and subsidiaries:
• Centreport Captive Insurance Limited
• Centreport Properties Limited
• Kordia Group Limited and subsidiaries:
• Kordia Limited
• Kordia New Zealand Limited
• Ngāi Tahu Holdings Corporation Limited (Ceased 31
January 2024)
• nib NZ Limited (as of 1 February 2024)
• nib NZ Insurance Limited (as of 1 February 2024)
• nib NZ Holdings Limited (as of 1 February 2024)
• Payments NZ Limited
• Rangatira Limited
Shareholder of:
• CH4 Global Inc

Candace Nicole Kinser:
Director of:
• Cancer Society of New Zealand Incorporated
• Eastland Group Limited and subsidiaries:
• Eastland Generation Limited
• Eastland Port Limited
• Gisborne Airport Limited
• Helius Therapeutics Limited (Chair)
Chair of:
• Cancer Society of New Zealand, Auckland Northland
Division Incorporated
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)
• Aqus Limited (as of 31 May 2024)
Director and Shareholder of:
• Bortons Agri Limited
Corrigan George Sowman:
Member of:
• Fonterra Sustainability Advisory Panel
Alison Jane Watters:
Director of:
• Fonterra Co-Operative Group Limited
• High-Value Nutrition (National Science Challenge)
• Meteorological Service of New Zealand Limited
• Totally Vets Limited
Shareholder of :
• AgInvest Holdings Limited (27.61%) AgInvest Holdings
Limited has a 16.66% holding in Figured Limited.
• Agriculture Resources Limited
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
44 Livestock Improvement Corporation Consolidated Annual Report 2023/24

Duncan James Bruce Coull
Director and Shareholder of:
• RBS (2015) Limited
• RBS Invest Limited
• Ballance Agri-Nutrients Limited
• Ngutunui Dairies Limited
Director of:
• New Zealand Phosphate Company Limited
Victoria Jean Trayner
Director of:
• Waimakariri Irrigation Limited
• North Canterbury Land Holding Limited
Director and Shareholder of:
• Platinum Farming Limited
Shareholder of:
• Motu Lodge Stud Limited
Senior Staff
In addition to the directorships of LIC subsidiaries as detailed below, senior members of staff have recorded
the following interests:
David Luk Chin (Chief Executive)
Director of:
• Agricultural Leaders’ Health and Safety Action Group
Emma Jane Blott (GM Commercial)
Director of:
• Eurogene AI Services (Ireland) Limited


Brent Denis Mealings (Chief Financial Officer)
Director of:
• Figured Limited
Michael Rose (Business Development Manager -
International, Australia)
Director of:
• National Herd Improvement Australia (NHIA)
Livestock Improvement Corporation Consolidated Annual Report 2023/24 45

The Directors of the Company’s subsidiaries as at 31 May 2024 are set out below:
• LIC Agritechnology Company Limited: Ben Dickie, Tim Gibson, Sophie Haslem, Candace Kinser, Matt
Ross, Corrigan Sowman, Duncan Coull, Victoria Trayner and Alison Watters.
• Livestock Improvement (New Zealand) Corporation Limited: David Chin and Brent Mealings
• LIC Ventures No. 1 Limited: David Chin and Brent Mealings
• LIC Ventures No.3 Limited: David Chin and Brent Mealings
• Agrigate GP Limited: Emma Blott, Brent Mealings and Dhaya Sivakumar
• 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, Brent Mealings and Michael Rose
• Livestock Improvement Corporation (UK) Limited: Brent Mealings, Emma Blott and Mark Ryder
• LIC Ireland Limited: Emma Blott and Mark Ryder
• Livestock Improvement Automation Limited (IRE): Emma Blott and Mark Ryder
David Hazlehurst resigned from the following subsidiaries of the Company during 2023/24:
• Livestock Improvement (New Zealand) Corporation Limited
• LIC Ventures No. 1 Limited
• LIC Ventures No. 3 Limited
• Agrigate GP Limited
• Beacon Automation Pty Limited
• Livestock Improvement (UK) Limited
• LIC Ireland Limited
• Livestock Improvement Automation Limited (IRE)
46 Livestock Improvement Corporation Consolidated Annual Report 2023/24

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 2025/26 season.
Directors participating in the scheme include:






b) Share Dealings by Directors
As at 31 May 2024 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.
31 May 202431 May 2023
DirectorOrdinary SharesOrdinary Shares
Ben Dickie*50,86740,865
Matt Ross**94,54494,544
Corrigan Sowman80,48880,488
Alison Watters33,57633,576
Duncan Coull7,824N /A
Victoria Trayner5,600N /A
*Includes shares purchased through participation in the Voluntary Investment
Scheme and shares compulsorily purchased to meet LIC’s Shareholding
Requirements
**Includes shares compulsorily purchased to meet LIC’s Shareholding
Requirements
DirectorPotential Calf
Sales
Potential Value
Matt Ross14$259,000
Corrigan Sowman1$18,500
Duncan Coull1$18,500
Livestock Improvement Corporation Consolidated Annual Report 2023/24 47

RESOLUTION OF DIRECTORS
DATED 18 JULY 2024 CONFIRMING THE CO-OPERATIVE STATUS OF LIVESTOCK
IMPROVEMENT CORPORATION LIMITED
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 2024.




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.
Size of ShareholdingNumber of Shareholders* Shares Held% of Total
1 - 999613392,9360.27%
1,000 - 1,9998621,346,0900.91%
2,000 - 2,9998011,955,1411.32%
3,000 - 3,9995971,985,8651.34%
4,000 - 4,9998023,526,9032.39%
5,000 - 5,9994222,335,9681.58%
6,000 - 6,9993982,571,0871.74%
7,000 - 7,9993542,624,9011.78%
8,000 - 8,9994093,462,4972.34%
9,000 - 9,9992562,439,0071.65%
10,000 - 14,9991,05112,831,3168.69%
15,000 - 19,99967311,649,7877.89%
20,000 - 24,9993948,792,3725.95%
25,000 - 29,9992958,020,6785.43%
30,000 - 34,9991986,405,8614.34%
35,000 - 39,9991415,243,3813.55%
40,000 - 49,9991988,826,7155.98%
50,000 - 99,99927618,180,19212.31%
100,000 - 199,999608,095,3005.48%
200,000 - 299,999153,635,1712.46%
300,000 - 499,99962,320,4231.57%
500,000 - 999,99964,311,3942.92%
1,000,000 +1226,729,43518.10%
Spread of Shareholders as at 30 June 2024
(including treasury stock and nil paid shares)
*The number of Shareholders above is based on the number of separate/individual farms. The table below setting out the twenty largest
shareholdings, amalgamates Shareholders with multiple farms.
48 Livestock Improvement Corporation Consolidated Annual Report 2023/24

Substantial
product holders
Number of
shares
Percentage
of shares
Date of
notice
Trinity Lands
Limited
7,328,9835.943%19/09/19
Peter James
McBride
7,329,5775.943%19/09/19
Key:
Number of shares = Number of quoted fully paid ordinary
shares in substantial holding at date of notice
Percentage of shares = Percentage of quoted fully paid
ordinary shares in substantial holding at date of notice
Credit Rating Status
LIC currently does not have a credit rating.
Substantial product holders
Based on substantial product holder notices
received by the Company from shareholders, as at
31 May 2024, the following parties were substantial
product holders of the Company:
LIC understands that Peter James McBride’s
substantial product holder disclosure is in relation
to financial products held by Trinity Lands Limited,
also disclosed above, and Crocodile Farm Limited.
Peter James McBride’s substantial product holding
notice states his interest 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.
As noted above, these substantial product holder
notices were received on 19 September 2019. The
Company has not received any other substantial
product holder notice since that date.
Based on the Company’s records, as at 31 May
2024, no shareholder holds more than 5% of the
shares in the Company (comprising the only class
of quoted voting products of the Company). Where
a person holds a relevant interest in shares other
ShareholderShares held% of total shares
Trinity Lands Limited 7,315,625 4.95%
LIC Treasury Stock 5,337,584 3.61%
Kotare Futures Limited 3,025,000 2.05%
Sim Brothers Limited 2,539,162 1.72%
David Lockhart Easton & Anthea Clare Easton & RFH Trustees 2,168,220 1.47%
Melrose Dairy Limited 1,600,087 1.08%
Anglesea Agriculture Limited 1,517,203 1.03%
Cayuga Limited 1,226,843 0.83%
Robert Laurentius Johannes Bruin & Annemarie Bruin 1,098,423 0.74%
Kotare Pastoral Limited 1,063,942 0.72%
CIP Nominees No 1 Limited (Employee Share Scheme) 1,048,008 0.71%
Mangatarata Farms Limited 850,000 0.58%
Mark Braden Neil Dewdney & Anne Heather Dewdney & Victoria Ann Dewdney 785,471 0.53%
Christopher John Stark & Graham Carr 718,372 0.49%
DB Douglas Limited 646,956 0.44%
Pilsen 2021 Limited 616,944 0.42%
J D & R D Wallace General Partnership Limited 566,288 0.38%
Malrose Properties Limited 525,241 0.36%
Bishop Farms Oxford Limited 474,572 0.32%
Kaimanawa Farms Limited 443,502 0.30%
Laird Farm Limited 437,772 0.30%
Landcorp Farming Limited 419,540 0.28%
Twenty Largest Shareholdings as at 30 June 2024
(including treasury stock and nil paid shares)
Livestock Improvement Corporation Consolidated Annual Report 2023/24 49

than by virtue of being the legal holder of shares,
the Company may not be aware of that person’s
relevant interest and would be reliant on their
lodgement of a substantial product holder notice.
LIC notes that the disclosures made at the date of
the original notice are also available on nzx.com
under LIC’s announcements.
Donations
The Company made donations totalling $7,000
during the year ended 31 May 2024.
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 NZX REGULATION LIMITED (NZXR)
On 29 August 2023, NZX Regulation Limited (NZXR) released an amended and restated waivers, rulings and
approvals decision in relation to the Company 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 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 .
6. 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.
7. 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.
8. 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;
50 Livestock Improvement Corporation Consolidated Annual Report 2023/24

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.
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
18 July 2024 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
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, or the
issue of Shares from treasury stock.
d) Shareholders who do not participate will not
be diluted or otherwise disadvantaged as
no new Shares are being issued under the
Dividend Plan;
e) 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.
f) 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;
g) 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
Livestock Improvement Corporation Consolidated Annual Report 2023/24 51

h) 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 Directors and Senior Managers who are
eligible and 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 Directors and Senior Managers 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
18 July 2024 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 Directors and Senior Managers a
means of acquiring additional shares in LIC
through a fixed trading plan, given the risk
they will often be information insiders, and
without incurring transaction costs which they
would otherwise incur;
b) The additional shares will be acquired by
Craigs either through on-market transactions
or the issue of Shares by LIC from treasury
stock. Participating Directors and Senior
52 Livestock Improvement Corporation Consolidated Annual Report 2023/24

Managers will pay the average NZX market
price paid by Craigs on market for those
Shares.Participating Directors and Senior
Managers will pay a uniform price in relation
to a season.
c) Participating Directors and Senior Managers
will pay a uniform price in relation to a season.
d) The Investment Scheme will enhance the
liquidity in the market for the Shares, providing
a more liquid market for both participating
Directors and Senior Managers and non-
participating Shareholders wishing to trade in
LIC shares; and
e) The Investment Scheme enables LIC to offer
eligible Directors and Senior Managers a
mechanism to invest in LIC Shares without
resulting in unnecessary new capital being
raised through the issue of new shares.
f) The amount of financial assistance is minimal
in comparison to the benefits arising out of the
Investment Scheme for participating Directors
and Senior Managers, non-participating
Shareholders and LIC.
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 18 July 2024 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 Shares are being
issued under the Employee Scheme;
d) The additional shares will be purchased
through Craigs at the market price.
e) 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;
f) 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 2023/24 53

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

---

There's always room for improvement
Livestock Improvement Corporation Limited (LIC or the Co-operative)
Climate Statements
For the year ended 31 May 2024

About these Climate Statements
As a large listed issuer on the New Zealand Stock Exchange (NZX), LIC is a
Climate Reporting Entity (CRE). The scope of the LIC reporting entity includes
all subsidiaries and aligns to the scope used for LIC’s consolidated financial
statements included in LIC’s Annual Report 2024, available here www.lic.co.nz/
shareholders/financial-results-announcements/. This is LIC’s first set of Climate
Statements prepared under the External Reporting Board’s climate-related
disclosure reporting framework. The Climate Statements are for the year ended 31
May 2024 and have been reviewed by LIC’s Board of Directors.
This initial report is the start of LIC’s climate reporting journey as we continue
to integrate climate change considerations into governance, strategy and risk
management processes. The disclosures comprising this climate statement comply
in all respects with Aotearoa New Zealand Climate Standard 1, Climate-related
Disclosures (NZ CS 1), in conjunction with adoption exemptions (and applicable
conditions for relying on those adoption exemptions) available under Aotearoa
New Zealand Climate Standard 2, Adoption of Aotearoa New Zealand Climate
Standards (NZ CS 2), and are presented in accordance with Aotearoa New
Zealand Climate Standard 3 (NZ CS 3), General Requirements for Climate-related
Disclosures (together the NZ CS). For example, information is disclosed in the
report where it is considered to be material, as defined in NZ CS 3, namely that
“information is material if omitting, misstating or obscuring it could reasonably be
expected to influence decisions that primary users make on the basis of an entity’s
climate-related disclosures”. Primary users are defined as LIC’s current and future
farmer shareholders, lenders and other creditors.
NZ CS 2 recognises that it may take time to develop capability to produce high-
quality climate-related disclosures. LIC has adopted certain exemptions available
under NZ CS 2 for this first report:
−Adoption provision 2, paragraph 12: Anticipated financial impacts of climate-
related risks and opportunities reasonably expected by the entity, NZ CS 1
paragraphs 15(b), 15(c) and 15(d);
−Adoption provision 3, paragraph 15: Transition plan aspects of LIC’s strategy,
NZ CS 1 paragraphs 16(b) and 16(c). Refer to page 25 for a description of LIC’s
progress towards developing transition plan aspects of our strategy;
−Adoption provision 4, paragraph 17: Scope 3 greenhouse gas (GHG) emissions, NZ
CS 1 paragraph 22(a)(iii);
−Adoption provision 5, paragraph 18: Comparatives for Scope 3 GHG emissions, NZ
CS 1 paragraph 40;
−Adoption provision 6, paragraph 20: Comparatives for metrics, NZ CS 1
paragraph 40; and
−Adoption provision 7, paragraph 22: Analysis of trends, NZ CS 1 paragraph 42.
Approved on behalf of the Board on 21 August 2024
DirectorDirector
LIC Climate Statements
2

Disclaimer
These Climate Statements contain forward-looking statements, including climate-
related metrics, climate scenarios, climate-related risks and opportunities,
estimated climate projections, targets, assumptions, forecasts, and statements of
LIC’s future intentions.
This document reflects LIC’s best estimate and current understanding of future
climate-related events, risks, opportunities, impacts and strategies as at 21 August
2024, the date of publication. LIC has sought to provide accurate disclosures as at
publication. Given the novel and developing nature of the information contained
in these Climate Statements, as well as the inherent uncertainty of the subject
matter, “accurate” does not entail certainty of outcome. It means that LIC has
undertaken appropriate measures and implemented adequate controls such that
the information presented is believed to be free from material error or misstatement
and is otherwise fairly presented.
LIC cautions that forward-looking statements are not facts, but rather estimates
and judgements regarding future results that are based on current estimates,
and on current views of LIC which may be subject to change, and are necessarily
subject to risks, uncertainties and/or assumptions. Estimates may prove to be
incorrect due to unforeseen risks and general uncertainties of the business and
environment we operate in, as well as due to the inherent uncertainty in the future
impacts of climate change on our business and the dairy sector. LIC has used its
best efforts to provide a reasonable basis for forward-looking statements but is
constrained by the novel and developing nature of this subject matter. Climate-
related forward-looking statements may therefore be less reliable than other
statements LIC may make in its external reporting.
Descriptions of the qualitative and quantitative current and anticipated impacts
and current financial impacts of climate change draw on and/or represent
estimated figures only and have been developed using methodologies currently
considered by LIC to be the most suitable. They are necessarily subject to risks,
limitations, uncertainties and/or assumptions and change. In particular, the risks
and opportunities described in this document, and the target emissions reductions,
may not eventuate or may be more or less significant than anticipated. There are
many factors that could cause LIC’s actual results, performance, or achievement of
climate-related metrics (including targets) to differ materially from that described,
including economic and technological viability, as well as climate, government, and
market factors outside of LIC’s control.
These Climate Statements, including any financial information included, have not
been subject to an external audit or independent assurance.
Nothing in this report should be interpreted as an offer of interests in financial
products or earnings, capital growth, or any other legal, financial, tax, or other
advice or guidance.
To the greatest extent possible under New Zealand law, LIC expressly disclaims all
liability for any direct, indirect or consequential loss or damage arising directly or
indirectly out of the use of or inability to use, or the information contained within,
these Climate Statements.
For the year ended 31 May 2024
3

LIC Climate Statements
4

Contents
INTRODUCTION 6
GOVERNANCE 7
STRATEGY 11
BUSINESS MODEL AND STRATEGY 11
CLIMATE
-
RELATED RISKS AND OPPORTUNITIES AND DECISION MAKING 13
CURRENT CLIMATE
-
RELATED IMPACTS 14
SCENARIO ANALYSIS 16
CLIMATE
-
RELATED RISKS AND OPPORTUNITIES 21
TRANSITION PLANNING 25
RISK MANAGEMENT 26
METRICS AND TARGETS 28
APPENDIX 34
GHG EMISSIONS METHODS, ASSUMPTIONS AND ESTIMATION UNCERTAINTY 34
For the year ended 31 May 2024
5

Introduction
LIC is a New Zealand dairy farmer-owned co-
operative and a leader in pasture-based dairy
genetics and herd management. We exist to deliver
superior genetics and technological innovation to
help our shareholders farm profitable and sustainable
animals. This is even more relevant to farmers today
given the growing climate challenges we’re facing.
Who we are and what we do has never been more
important for Kiwi farmers, our sector and New
Zealand as our future depends on protecting the
natural environment. The dairy sector needs to
continue to evolve, for climate change and because of
it, to retain ongoing market access.
At LIC, we are committed to reducing the emissions
of our business. LIC has previously set emissions
reduction targets based on science-aligned
methodologies using SBTi (Science Based Target
initiatives) tools and guided by the biogenic methane
emissions reduction target in the Climate Change
Response Act 2002, with the intention of reducing our
greenhouse gas (GHG) emissions and contributing
proportionately to the efforts to limit the global
average temperature increase to 1.5°C above pre-
industrial levels. While we have been working hard on
reducing emissions, the organisation is currently in the
process of reviewing our emissions reduction targets
and corresponding base year calculation to ensure
that they are appropriate given the challenges the
sector is currently facing with a lack of sufficient novel
technology and innovation being available to achieve
the targeted emissions reduction, as well as to reflect
LIC’s unique role in assisting the New Zealand dairy
sector to drive down methane emissions. This means
that the targets and base year calculations may
change, and current disclosures should be considered
with that in mind.
The physical effects of climate change are
already intensifying and becoming more common,
demonstrating the need for our business to be flexible
and resilient in providing critical on-farm services to
our farmer shareholders. Climate-related transition
risks also present a potential challenge, including the
risk of regulation and legislation change, impacts of
innovation and maintaining dairy sector reputation
and market access. LIC’s business is largely driven
by the size of the national dairy herd, which has been
reducing over time and may continue to reduce in
response to climate-related transition risk pressures.
If the dairy sector is milking fewer cows, those cows
need to be better ones. This creates a climate-related
opportunity for LIC to help farmers identify and breed
from their more efficient and profitable cows. Using
our genetic data relating to the national dairy herd,
LIC has been able to model the genetic potential
enteric methane emissions relative to milk solids
production, indicating an improved trend over recent
years attributable to better genomic selection.
LIC recognises the importance of identifying
climate-related potential scenarios in a consistent
and comparable way within the dairy sector. To
this end, our Chief Executive was a member of the
Leadership Group that developed the Aotearoa
Circle’s Agriculture Sector Climate Change Scenarios.
1

Building on these scenarios, we have adapted the
three possible future sector scenarios to LIC’s specific
circumstances to better understand our climate-
related risks and opportunities. These scenarios are
not predictions of the future, rather they challenge
us to consider our strategy and business model
under plausible socio-economic, technological,
environmental, and political futures. These insights
can help us build resilience, prepare for potential risks
and uncertainties, and identify opportunities to lead
the way in innovation and herd improvement.
1
Aotearoa Circle Agriculture Sector Climate Change Scenarios
LIC Climate Statements
6

Governance
Figure 1
Governance Body
LIC Board of Directors (the Board)
Audit Finance & Risk
Committee
People & Culture
Committee
Climate Governance at LIC
LIC Board of Directors
The primary responsibility of the Board in relation to risk management is to
ensure that it develops a clear understanding of the fundamental risks and
rewards implied under LIC’s business model and strategy, overseeing and holding
management accountable and setting appropriate risk appetite for LIC. As part
of their governance duties, our Board has visibility and oversight of sustainability
and climate-related risks and opportunities. The Board approves and is ultimately
responsible for our overall climate strategy, material initiatives, frameworks, targets,
metrics, and policies.
The Board monitors progress against and oversees achievement of climate-related
metrics and targets. Governance responsibility in relation to climate has been kept
at the full Board level at this stage, although the Audit, Finance and Risk Committee
(AFRC) oversees elements of climate-related risk, and the People & Culture
Committee has the responsibility for terms of remuneration of the Chief Executive
and oversees People policies (for more information in relation to how metrics and
targets are included in remuneration policies, refer to the Metrics and Targets section
of these climate statements).
LIC’s commitment to managing the environmental impact of our products,
services, and work activities, enhancing our environmental performance and
achieving continual improvement, including in relation to our farmer shareholders,
is documented in an Environmental Policy, which is approved by the Board every
two years.
During the reporting period, the Board held ten meetings. Climate-related risks,
opportunities and/or reporting requirements were discussed at seven of those
meetings. The AFRC held six meetings during the reporting period. Climate-related
risks and/ or reporting requirements were discussed at all of those meetings.
More information on our Board and Board committees can be found in our Annual
Report 2024
2
.
2
LIC’s Annual Reports are available at www.lic.co.nz/shareholders/financial-results-announcements/
Management
LIC Senior Leadership Team (SLT)
SLT members with specific climate responsibilities
Chief
Executive
Officer
Chief People
Officer
Chief
Scientist
Chief
Financial
Officer
Other management roles with specific climate-related responsibility
General
Counsel
Health, Safety
& Environment
Manager
Senior
Environmental
Advisor
Group
Financial
Controller
Representatives
from each LIC
business unit
Environment & Sustainability Management Committee, also includes
Chief People Officer & Chief Scientist
For the year ended 31 May 2024
7

The Board’s oversight of climate-related risks and opportunities (Table 1):
Processes and frequency by which the Board
is informed about climate-related risks and
opportunities
Climate-related transition and physical risks and opportunities were discussed with the Board in May 2023 and further
workshopped in March 2024. The Board endorsed the approach of climate risk being a sub-category risk in LIC’s risk
management tool as it impacts more than one of LIC’s key risk areas. Updates on LIC’s key risk areas (including, where
identified, climate-related risks) are presented at each meeting of the Audit, Finance and Risk Committee. Progress
on material climate-related opportunity initiatives is reported by management to the Board at every meeting through
traffic light reporting and individual papers where relevant. As implementation of climate-related reporting is still in
the early stages, full climate-related risk and opportunity information has been discussed with the Board at multiple
meetings during the reporting period. Management is developing regular reporting for material climate-related risks
and opportunities, with an update being provided to the Board at every Board meeting.
How the Board ensures that appropriate skills and
competencies are available to provide oversight
As part of the Director election process, skills are considered including Sustainability on Farm, which includes climate
change expertise related to the dairy sector. Our Board Chair is a member of Fonterra’s Sustainability Advisory Panel,
and another Director is also a Director on Fonterra’s Board and a member of Fonterra’s Sustainability & Innovation
Committee. Other Directors and members of management have taken individual responsibility for increasing their
climate capability through attending relevant conferences and courses and climate-related matters are being
considered in planning Director development. Management recruitment has included experts in GHG emissions and
environment advice, and management have worked with the Board on ensuring that compliance requirements are
well understood.
The Board Chair and Chair of the People & Culture Committee work with the Chief People Officer on a forward program
of development for the Board and individual directors, which includes developing climate-related competency.
How the Board considers climate-related risks and
opportunities when developing and overseeing
implementation of strategy
Material climate-related risk and opportunity initiatives are considered as part of the annual planning and budgeting
process. For example, this year’s capital budget included installation of solar panels at Head Office and the R&D
operational budget included expected spend on climate-related opportunity initiatives. Moreover, LIC’s strategy
includes Environment and Sustainable Co-op as key pillars. Material investments are presented separately to the Board
for budget approval.
For further information in relation to LIC’s climate-related risk and opportunity initiatives, refer to section titled
“climate-related risks and decision making” in the strategy section of this climate statement.
How the Board sets, monitors progress and oversees
achievement of metrics and targets
GHG emissions targets, results and progress relative to the baseline year are presented to the Board annually and
the Board discusses further initiatives, metrics, or targets that may be required based on those results and progress.
Environmental Strategy and Energy Strategy documents are also reviewed by the Board. Progress on material climate-
related risk and opportunity initiatives are reported on as part of Board traffic light reporting by the Chief Executive and
regular reporting outside of traffic light reporting is also being established.
For further information in relation to the metrics and targets that LIC currently has in place and whether these are
incorporated into remuneration policies, refer to the metrics and targets section of this climate statement.
LIC Climate Statements
8

LIC Senior Leadership Team
Day-to-day management of risks and opportunities within the Co-operative is
delegated to members of LIC’s Senior Leadership Team (SLT) and other senior
leaders, as shown in Table 2 and Figure 2. While the wider SLT monitors and
discusses climate-related risks and opportunities and endorses content to go to
Board meetings, the members identified in Table 2 have significant responsibilities
related to climate-related risks and opportunities.
The SLT meets fortnightly, with quarterly strategy offsites, and those meetings
have included a range of environmental topics since the beginning of the reporting
period, including: updates on environment and sustainability, climate reporting,
Environment and Sustainability Strategy 2024-2027, Energy Strategy 2024-2030.
The Environment and Sustainability Management Committee (ESMC) includes
two SLT representatives, meets quarterly and focusses on identifying and driving
environmental risks and opportunities for improvement across the business.
Any new climate-related risks raised can be integrated into LIC’s risk tool for
assessment and control and/or mitigation identification and material risks would
then form part of management discussions and AFRC reporting.
SLT members with specific climate-related responsibilities (Table 2):
Chief Executive Officer• Responsible for managing and delivering the Co-op’s
strategy and performance
• Responsible for management of climate-related risks
and opportunities
• Attends all Board and sub-committee meetings
Chief People Officer• Oversees Environmental Policy, environment
strategic plans, GHG data management and
reporting
• Attends ESMC
• Attends People & Culture Committee
Chief Scientist• Oversees climate-related R&D initiatives
• Attends ESMC
Chief Financial Officer• Aligns LIC’s reporting on climate-related risks and
opportunities with NZ CS
• Considers financial implications of climate-related
risks and opportunities in financial planning, capital
allocation and financial reporting
• Oversees Sustainability Reporting
• Attends Board and AFRC meetings
For the year ended 31 May 2024
9

Other management roles with climate-related responsibility (Figure 2):
Environment & Sustainability Management Committee, also includes Chief People Officer & Chief Scientist
General Counsel
Health, Safety &
Environment Manager
Senior Environmental AdvisorGroup Financial Controller
Representatives from each LIC
business unit
Oversees sustainability and
climate-related legal risk.
Attends Board meetings, where
required attends subcommittee
meetings. Monitors upcoming
legislative change and reports
potential impacts to AFRC.
Drives compliance with
environment legislation,
development and execution of
environment policy and strategy,
oversees GHG reporting, Chairs
ESMC.
Drafts, implements and
maintains environment policy,
systems and strategy, manages
GHG data gathering and
reporting, facilitates ESMC
and works with business unit
members on initiatives.
Oversees climate and
sustainability reporting,
considers financial implications
of climate-related risks and
opportunities in budgeting and
financial reporting. Attends
AFRC, presents to Board on
climate and sustainability
reporting.
Employees passionate about
driving continuous improvement
to reduce waste and reduce our
environmental impact.
−LIC’s Transformation Office reporting tool categorises environmental initiatives to enable
centralised reporting of all relevant environmental or sustainability initiatives
−LIC’s Investment Committee considers requests for funding and approves the internal emissions
price: business cases for initiatives are required to include any environmental considerations
and a monetary impact if GHG emissions are estimated to be impacted by more than 10 tCO
2
-
equivalent emissions per year
−LIC’s R&D team includes scientists with relevant skills and experience working on climate-related
opportunities
LIC Climate Statements
10

Business Model
LIC is a New Zealand dairy farmer-owned co-
operative and LIC shares are listed on the NZX. To be
a shareholder in LIC, you have to farm dairy cows in
New Zealand, supply a New Zealand milk processor
and buy a minimum amount of qualifying products
and services from LIC every season. As a farmer-
owned co-operative, all of our profit is returned to our
farmer shareholders in dividends or reinvested into
new solutions and research and development (R&D).
LIC’s headquarters are in the Waikato, along with
laboratories, herd testing facilities, a dairy farm and
bull farms. Additional bull farms are in the Central
North Island. Herd testing and artificial breeding
depots are located throughout the North and
South Island.
LIC’s principal activities are carried out in New
Zealand, including artificial breeding products and
services, herd testing of milk samples, DNA testing,
animal health testing, herd management software,
on-farm support and consultants, sale of heat
detection and animal tag products and research and
development (R&D).
The majority of LIC’s customers are dairy farmers,
or professionals such as vets providing our services
to dairy farmers. LIC is structured to best support
farmers and our operational teams to effectively
supply products and services to customers, which
results in a significant volume of vehicle travel to dairy
farms in rural areas. For artificial breeding products
and R&D purposes, LIC owns or oversees a large
volume of elite bulls, a dairy herd and trial animals.
LIC has smaller business operations in Australia, UK
and Ireland, mainly for the purpose of selling artificial
breeding products collected in New Zealand, and
owns a small business manufacturing bovine heat
detection products in Australia.
Strategy
3
Home - Pathways to Dairy Net Zero
Strategy
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 farmer shareholders sustainably farm a
profitable animal. Value for farmer shareholders is at
the heart of our strategy (Figure 3).
Our strategy makes three commitments to our
farmer shareholders: operational excellence, faster
genetic improvement and software reliability and
performance. Faster genetic improvement specifically
commits to having farmers’ backs when it comes to
helping them meet the environmental challenges
we face as a sector, in particular through animal
efficiency and methane mitigation.
In October 2021, LIC pledged its support for ‘Pathways
to Dairy Net Zero’
3
, a global initiative which aims to
accelerate climate change action and reduce GHG
emissions across the dairy sector.
Our three-year plan (which runs to 31 May 2027)
includes climate-related initiatives, some of which will
bring long-term genetic benefits - the most significant
impact we can make is through helping farmers to
reduce the environmental footprint of the national
dairy herd. Working with dairy farmers, including
via processors such as Fonterra, to help farmers
accelerate their herd improvement is important to
help the sector to reduce its overall emissions.
For the year ended 31 May 2024
11

Our Farmers
Deepen our understanding
of the current and future
needs of all of our farmers.
Animal
Most sustainable &
efficient animal. Highest
value products.
Data & Digital
Modernising the
animal data & digital
capabilities.
Innovation
Research &
development.
Responsive innovation.
LIC’s strategy (Figure 3)
LIC is running a number of long-term trials, resulting in
a significantly higher volume of trial animals included
in our biogenic methane emission results compared
to our 2018/19 emissions base year. This will likely
continue while there are still opportunities identified
to reduce emissions through genetic improvement
requiring a R&D focus, or other areas of genetic
improvement needed within the dairy sector.
As a result, LIC’s own Scope 1 biogenic methane
emissions may not reduce until we have advanced
the work to help the national dairy herd to reduce
methane emissions and we are currently reviewing
this target to ensure that it reflects likely progress
of R&D initiatives over time. Improving genetics
is a long game, but we are confident that our
initiatives will result in benefits to the sector through
more emissions-efficient, heat tolerant and more
productive animals.
Although LIC is committed to ongoing reduction of
emissions, we recognise that new technologies will be
required to further reduce our emissions out to 2050,
creating uncertainty around how we will continue to
reduce emissions without using some form of carbon
credit offset in future. For example, much of LIC’s
vehicle travel is over long distances in rural areas so
feasible alternatives to diesel-fuelled utes and light
trucks will be critical, as well as lower emission fuelled
air travel.
LIC Climate Statements
12

Climate-related risks and opportunities and decision making
Climate-related risks fall into two main categories: physical and transition risk
factors. These have the potential to affect LIC’s entire business, including through
impacts of those factors on our dairy farmer customers, and are taken into account
as an input to LIC’s internal capital deployment and funding decision-making
processes, along with climate-related opportunities, as described below.
Physical risk
Physical risk factors are those related to the impacts of the changing climate and
can be further categorised as acute or chronic:
−Acute risk factors are those related to more frequent and intense extreme climate
events such as heatwaves, droughts, bushfires, floods and storms; and
−Chronic risk factors are those related to gradual changes in climatic conditions
such as increasing temperatures, changes in precipitation patterns and sea-
level rises.
Transition risk
Transition risk factors are those related to the process of transitioning towards a
climate-resilient and lower emissions society where transition pathways may vary
and can be further categorised as arising from these changes:
−Policy changes, including policies and regulations impacting both the broad
economy as well as those impacting the dairy sector;
−Innovation changes, including developments in farming practices and alternative
proteins; and
−Market and reputation changes, such as shifts in consumer preferences or
market access impacts.
The number of cows in the national herd is a key assumption considered as part
of LIC’s strategic planning process and underpins our expected five-year activity
level in relation to product sales. In addition, the biggest asset on LIC’s balance
sheet is our bull team. There is a complex, inter-related mix of factors impacting
the number of cows (including climate-related risks and opportunities), such as
challenges with succession planning on farm, farmers seeking to diversify their
operations, changing land use, volatility of milk price and the high cost of capital
for new entrants. Seasonal milk prices are an additional key assumption: a low milk
price can generally result in lower levels of activity with farmers seeking to reduce
costs. The risk of low milk price could be increased by climate-related factors, such
as market or reputation transition risk, but can also have an inverse relationship.
Where weather conditions contribute to global supply being lower than demand,
milk price could be stronger.
LIC’s Investment Committee has set an internal emissions price to be used as a
tool to calculate a financial impact when considering climate-related opportunity
or risk initiatives. The results factor into capital investment decisions to ensure
that decarbonisation opportunities are considered in a similar way to any other
initiative. The financial analysis template LIC uses for considering costs and
benefits of proposed initiatives, including climate-related risks or opportunities, has
been updated to include a financial impact of GHG emissions reduction using the
internal emissions price. Where an initiative will change LIC’s GHG Scope 1 or Scope
2 emissions by more than 10 tCO
2
-equivalent per year, the business is required to
include a GHG monetary impact factor in the financial analysis.
In 2023 we went through a process to identify the most material physical and
transition climate-related risks relevant to LIC and ensured that those risks were
included in LIC’s risk register. After discussion with management, AFRC and the
Board decided that climate-related risk should be represented as a sub-category
risk in LIC’s risk management tool. This was on the basis that there are a range of
different climate-related risks that impact more than one of LIC’s key risk areas,
enabling risk appetite for the different types of climate risk to continue to be set for
those overarching key risk categories, and to be factored into capital deployment
and funding decision-making.
LIC’s material climate-related risks and opportunities are detailed on page 21.
For the year ended 31 May 2024
13

Current climate-related impacts
Current climate-related physical impacts
While the effects of climate change are expected to intensify over the coming decades, a number of impacts are already being observed.
Seasonal impacts are becoming more frequent, although not all climate events or impacts experienced translate into material impacts for LIC.
ImpactDescription of impactCurrent financial impacts
Drought or dry summer
conditions
Dry conditions in some areas may have
caused early dry-off of cows. Early dry-off
impacts LIC’s activity levels, for example
cancelled herd testing of milk.
It is not possible to identify any lost revenue in the reporting period that is
specifically attributable to drought or summer conditions exacerbated by
climate change, as farmers may have had multiple reasons for cancelling
a product or service, including lower milk price or the cost of feed
outweighing the benefits of extra days in milk.
Weather eventsExtreme weather events caused disruption
to LIC production and services, damage
to LIC assets and disrupted farmer
operations, resulting in cancellation or
delay to LIC services. For example, South
Island flooding impacted some farmers
during September 2023.
Weather events during the period were sufficiently temporary to not
materially impact LIC services provided on farm or result in a material
financial impact for LIC but are nevertheless material impacts in that they
indicate a trend of extreme weather and accordingly have an influence
on LIC’s planning for its exposure to this risk on an ongoing basis.
In the previous year, there was a $0.15m claim for repairs relating to
a lightning strike on 29 January 2023 which occurred at the end of
the Auckland Anniversary weather event. This caused damage to an
electrical board that managed LIC’s fire protection systems at the head
office building. The claim was paid out in the current reporting period.
Current climate-related transition impacts
ImpactDescription of impactCurrent financial impacts
Legislation and
regulation
• LIC is impacted by regulatory change and uncertainty in NZ relating
to climate policy, as well as general emissions reduction policies
• Resources allocated to collate data, perform analysis, prepare and
review Climate Statements
$0.1 million
Excludes employee time
LIC Climate Statements
14

ImpactDescription of impactCurrent financial impacts
Efforts to reduce
LIC’s emissions or
reduce environmental
impact risk
• Installation of more than 480 solar panels at Hamilton head office to
reduce LIC’s energy emissions
• Ongoing transition of vehicles to electric vehicles (EVs) and hybrids to
further reduce LIC’s fuel emissions
• Further additions to LIC EV charging station network
• Ongoing discussions with suppliers to reduce waste, increase
recycling, improve efficiency and access to emissions data
• Other asset replacements to reduce climate impacts
• Resources allocated to update Environmental Strategy and prepare
Energy Strategy
$0.6 million
Not all costs are able to be separately
identified (such as electricity supply for EV
charging stations, change in costs solely
due to electrification of vehicle fleet),
excludes employee time
Investments in climate-
related research
• Continued investment in climate-related opportunity research
projects to assist farmers to reduce emissions or adapt to climate-
change through improved genetics in future, including methane
validation trials and a heat tolerance breeding program.
$1.6 million (excludes external funding)
Although R&D time is captured, this is not
used to create separate financial records
for all initiatives
Climate change training• External training on climate statement requirements for relevant
employees, education sessions on potential impact of
climate-change risks on the dairy sector for employees
• Ongoing discussions with our dairy farmer customers on how
improvement to herd genetics can assist in decreasing
emissions intensity
• LIC runs a sustainability survey annually to gather information from
employees on flexible working and commuting patterns to gather
data for estimating Scope 3 employee commuting emissions. The
survey is also designed to understand the level of awareness across
our employees of LIC’s environmental disclosures, policies and
procedures, as well as to seek feedback from employees. There was
good engagement on our 2024 survey, with a 41% response rate.
No identifiable additional cost in the period
For the year ended 31 May 2024
15

Scenario analysis
The Aotearoa Circle Agriculture Sector Scenarios
4
were used as the foundation for
developing LIC’s climate-related scenarios for this report. The sector scenario work
programmes led by the Aotearoa Circle have been influential in bringing together
sectors across New Zealand to support climate reporting entities and encourage
greater comparability of reporting.
LIC’s scenario analysis process involved engagement and governance at a number
of levels of the organisation:
−Chief Executive and another SLT member engagement with the Aotearoa Circle in
developing the Agriculture Sector Scenarios
−Analysis and input from key management resources
−Reviews and discussion at both SLT and Board level
−Final approval of outputs at Board level
LIC did not enlist the help of external partners and no external stakeholders were
involved, with the exception of elected directors, who are farmer shareholders
in LIC. LIC intends to seek the views and input of external stakeholders in future
reporting periods when reporting processes are more developed.
LIC determined that the Aotearoa Circle Agriculture Sector Scenarios
4
were
the most relevant and appropriate starting point because they have been
created specifically for agribusinesses operating in New Zealand’s agricultural
sector, including LIC. Moreover, the scenarios were aligned to the temperature
requirements in NZ CS 1, including to have a 1.5 degree scenario, a 3 degree or
greater scenario, and a third climate-related scenario. The Aotearoa Circle created
three climate scenarios for the sector, which help meet the prescribed temperature
scenarios as set out in NZ CS 1:
−Orderly, temperature rise limited to 1.5°C (mandated)
−Disorderly, temperature rise limited to 2°C
−Hothouse, temperature rise increases past 3°C (mandated)
Scenario analysis is the process of exploring how an entity might perform under
a range of plausible futures. In a world of uncertainty, scenario analysis is meant
to challenge ‘business as usual’ assumptions. Climate-related scenario analysis
does not predict the future, but rather provides a range of hypothetical outcomes
to enable an entity to better assess how physical and transition risks and
opportunities associated with climate change could impact its operations.
Scenario narratives
Climate-related scenario narratives are plausible, challenging descriptions of
how the future may unfold and provide the parameters in which an entity conducts
scenario analysis to test overall strategic resilience based on a coherent and
internally consistent set of assumptions about key driving forces and relationships
covering both physical and transition risks in an integrated manner. Climate-
related scenarios are not intended to be probabilistic or predictive, or to identify
the ‘most likely’ outcome(s) of climate change. They are intended to provide an
opportunity for entities to develop their internal capacity to better understand
and prepare for the uncertain future impacts of climate change. Accordingly, all
outcomes described in our climate-related scenarios are only insights to assist
in resilience testing and strategy development and are not predictions of actual
future outcomes.
Scenario narratives are determined by the interaction of key social, technological,
economic, environmental, and political ‘drivers of change’ that may influence an
entity’s operating environment. These narratives include assumptions and logical
relationships to help identify potential impacts and severity of the impacts, on
operations, strategy, and financial planning.
4
Aotearoa Circle Agriculture Sector Climate Change Scenarios
LIC Climate Statements
16

LIC has adapted the Aotearoa Circle Agri-sector scenarios to reflect LIC’s role in
the dairy sector specifically. This process involved analysis by management of
the Aotearoa Circle scenarios, which LIC’s Chief Executive was directly involved
in developing, together with workshops with both SLT and the Board to develop
impact pathways specific to LIC. These outputs were then integrated with narrative
specific to LIC to shape the scenario narratives, which have been reviewed by the
full Board. This has been a standalone process, which is intended to become part of
regular strategy reviews over time.
Key differences between Aotearoa Circle’s scenario narratives and LIC’s scenario
narratives relate to focussing primarily on changes relevant to LIC’s role within
the dairy sector and technology developments. Table 3 summarises the three
scenario narratives and the key assumptions underlying each. It is worth noting
that scenarios are designed intentionally to be challenging and are not meant to be
perceived as ‘most likely’ outcomes.
Scenario assumptions and narratives – Table 3
OrderlyDisorderlyHothouse
ScenariosNet Zero 2050
Limit temperature rise to 1.5°C (with overshoot)
Delayed transition
Limit temperature rise to 2°C
Hothouse world
Temperature rise >3°C
Key climate
scenarios and
models used
• Intergovernmental Panel on Climate Change
(IPCC) Representative Concentration Pathway
(RCP) 2.6/SSP-1
• Scenarios dataset for the Climate Change
Commission’s 2021 Final Advice: Tailwinds data
set
• Ministry for the Environment 2018 Climate
change projections for NZ
• Ministry for the Environment 2022 Interim
guidance on the use of new sea-level rise
projections
• IPCC RCP 4.5/SSP-2
• Scenarios dataset for the Climate Change
Commission’s 2021 Final Advice: Headwinds
data set
• Ministry for the Environment 2018 Climate
change projections for NZ
• Ministry for the Environment 2022 Interim
guidance on the use of new sea-level rise
projections
• IPCC RCP 8.5/SSP-5
• Scenarios dataset for the Climate Change
Commission’s 2021 Final Advice: Current policy
reference data set
• Ministry for the Environment 2018 Climate
change projections for NZ
• Ministry for the Environment 2022 Interim
guidance on the use of new sea-level rise
projections
Brief descriptionRepresents a world defined by a smooth transition
to net zero CO
2
by 2050. Global warming is
limited to 1.5°C through stringent climate policies
and innovation. Assumes climate policies are
introduced immediately and become gradually
more stringent as 2050 looms. Both physical and
transition risks are relatively subdued. Achieving
net zero by 2050 reflects an ambitious mitigation
scenario.
Represents a world with little policy action until
after 2030, after which strong, rapid action is
implemented to limit warming to 2°C. Countries
and territories use fossil-fuel heavy policies to
recover from Covid-19, so emissions increase, and
nationally determined contributions are not met. It
is only after 2030 that new climate change policies
are introduced, but not all countries take equal
action. Consequently, physical and transition
risks are higher. This is a costly and disruptive
transition.
Describes a world in which emissions continue
to rise unabated beyond 2050 as no additional
climate change policies are introduced. Fossil
fuel use continues to increase, and so global CO
2

emissions continue to rise. The physical impacts of
climate change are severe. There are irreversible
changes such as ice sheet loss and sea level rise.
Adapting to climate change has become the
priority.
For the year ended 31 May 2024
17

OrderlyDisorderlyHothouse
Time horizonShort (to 2026/27), medium (2027-2035) and long (2036-2050) term, with 2050 being the endpoint, with the exception of Hothouse where the temperature
continues to increase beyond 2050 to exceed 3
o
C by 2080
Climate
impacts
Lowest - The physical impacts of climate change
have increased water stress in some regions.
Storm damage still poses high risks across large
parts of the country.
Medium - Physical climate worsens as critical
tipping points are surpassed.
Highest - The physical impacts of climate change
are severe.
Scope of
operations
The climate scenario analysis was focused on LIC’s New Zealand operations. International factors were considered where material, such as consumables
manufactured offshore or shipping of product sold to international markets. The climate scenario analysis also focused primarily on the dairy sector,
referencing the work done by the Aotearoa Circle on the agriculture sector.
Policy &
Socioeconomic
assumptions
• Climate policies and innovation are more
immediate and gradually become more
stringent
• Shift towards sustainable diets that include a
diverse range of proteins, but still a market for
premium animal products
• Some farmers were supported to transition out
of agriculture in unsustainable areas and policy
targets were met, with significantly lower cow
numbers resulting
• Alternative and lab grown proteins are
common, but a market for sustainable dairy
remains
• Consumers increasingly seek local produce with
labelling and stories that embed sustainability
• Disruptive, costly transition as rapid and strong
policy is implemented after 2030
• Reactive regulation results in cumbersome and
inconsistent reporting requirements for New
Zealand farmers
• Some farmers had to reduce, diversify, move, or
liquidate
• Collectives that have worked together to drive
transformative change have seen rewards
• Gene editing and selection policy has emerged
• No additional climate policies have been
implemented since the 2020s with mitigation
policy centred around the emissions trading
scheme
• Geopolitical tension and supply chain disruption
increases
• Increase in urbanisation means food production
suffers as rural communities decline and cost of
farming increases
• Food shortages and insecurity means New
Zealand has lost its low-emissions competitive
advantage and there is increased demand for
cheap protein, including dairy, to feed growing
populations
• Vulnerable countries have become
uninhabitable, leading to a refugee crisis
Dairy herd
impact – critical
assumption/
uncertainty
30% smaller dairy herd than 2020 by 205017% smaller dairy herd than 2020 by 205013% smaller dairy herd than 2020 by 2050
LIC Climate Statements
18