Those who put 33 euros on the table for a Lotus Bakeries share when it went public at the end of 1988 can now sell it for more than 5,500 euros. No Belgian stock has done better in the past quarter century. And yet, Lotus offers biscuits, an unsexy product. How did a family business pull off this feat?
Impossible to miss them. In all supermarkets, the biscuit shelves are full of Lotus Bakeries products. The family business produces chocolate, cakes, cookies, healthy snacks, gingerbread, waffles, etc. But its flagship brand remains Biscoff, still known in Belgium as Speculoos Lotus.
Impossible to miss them. In all supermarkets, the biscuit shelves are full of Lotus Bakeries products. The family business produces chocolate, cakes, cookies, healthy snacks, gingerbread, waffles, etc. But its flagship brand remains Biscoff, still known in Belgium as Speculoos Lotus. The stock market performance of Lotus Bakeries is equally remarkable. At 5,500 euros, the share is the most expensive on Euronext Brussels in nominal terms, while the biscuit maker only made its debut there in December 1988 at around 33 euros. It’s a pity that the small shareholders have not completed the entire course (read the box “The myth of the small shareholder” below). What is the recipe for success of the family shareholders who still own almost 56% of the company via the Dutch-law foundation Administratiekantoor van Aandelen Lotus Bakeries? The company is controlled by two families. The Boones, whose figurehead is CEO Jan Boone (50), and the Stevens family. The latter is in fact made up of a single person, the discreet Anton Stevens (read the box “The Alexander Van Damme of biscuits” below). On the contrary, for example, Belgian aristocrats who own AB InBev, the Boone and Stevens families do not make significant investments in other companies. The brewers hold diversification holdings worth billions of euros. With the motto: don’t put your eggs in the same basket. The families that own Lotus Bakeries do exactly the opposite: they mostly invest in their own business. The number of family actions thus remains remarkably stable. More: their stake in Lotus Bakeries has grown over the past decade. In November 1988, just before the IPO, 17 members of the two families from several branches combined their more than 400,000 shares in a family control vehicle. Today, the foundation under Dutch law holds more than 450,000 shares. This stability, however, hides a profound evolution between the branches of the family. While Anton Stevens has remained a very loyal shareholder, three branches now share control of the company within the Boone family. All descend from the patriarch Jan Boone (see the family tree below): with Anton Stevens, the families of the Karel brothers, Matthieu and Johan hold more than 90% of the family capital. It is no coincidence that they also control all the mandates of family administrators. Jan Boone, a son of Matthieu, is CEO. His step-nephew Jan Vander Stichele is chairman of the board. “We consolidated the shares in the foundation under Dutch law in 2010, explains Jan Boone. Some shareholders did not join us, but not out of dissatisfaction. A foundation has advantages and disadvantages. advantage of freedom. Those who join it can also participate in the management of the company. But they also find themselves linked to others. The foundation thus guarantees a certain anchoring. We believe in companies with a reference shareholder who takes decisions for the long term. But we did not unite because we have family ties. We believe in the future and the strategy of the company. Family ties are not a sufficient anchor.” In Lembeke, in the heart of distant and peaceful Meetjesland, lost between Ghent and the Dutch border, we clearly have great faith in its know-how. For more than a decade, the action did not take off on the stock market. The situation began to improve from 2003. And the real take-off came in 2010. But the ambition has always been present. “We want to make Lotus Biscoff one of the biggest brands in the world,” say Jan Boone and Jan Vander Stichele without blinking in the latest annual report. The brand is sold in more than 60 countries. Lotus Biscoff is set to become the third most popular cookie in the world. Numbers one and two are Oreo and Chips Ahoy, both in the hands of multinational Mondelez International. Lotus Biscoff is currently in ninth position. Lembeke’s production lines produce 7 billion Lotus Biscoffs per year. The American factory produces 1 billion. This brand policy did not fall from the sky. The 2002 annual report is already centered on the Lotus brand – more than 100 million euros in turnover or 70% of the total. In previous years, the company had invested too much in different brands. The fact that there is now only one Lotus brand has accelerated growth. Lotus Bakeries is the result of the merger of two biscuit makers from Meetjesland. In 1934, three brothers – Emiel, Henri and Jan Boone – created the Banket- en Peperkoekbakkerij Lotus in Lembeke, which produces speculoos and gingerbread. In the nearby town of Oostakker, pastry chef Marcel Stevens has been producing cakes and madeleines with his company Corona since 1937. They were leaders in their segment in Belgium when they merged in 1974. The marriage still holds. Family management is just as consistent. Second-generation leaders were forced out of office on their 70th birthday, the age limit set for directors. Antoine Stevens, the father of current shareholder Anton Stevens, worked in the family business from 1965 to 2003. Brothers Karel and Matthieu Boone were also asked to step down at 70. Karel was active there from 1966 to 2012, Matthieu from 1972 to 2016. Both were CEOs and managing directors, later chairman of the board of directors. Karel Boone also gained some form of notoriety in the 1990s as president of the Federation of Belgian Enterprises (FEB). In May 1996, Trends-Tendances saw in his appointment a clear signal of the FEB’s desire to highlight the importance of SMEs. At the time, the biscuit maker was only a large family SME. The current generation, the third, shows the same determination. CEO Jan Boone started by gathering experience elsewhere, notably at PwC and Omega Pharma. The KU Leuven economics graduate returned home in 2005, becoming CEO in 2011. His nephew by marriage and engineer Jan Vander Stichele started as director of Lotus Bakeries France in 1996, and became chairman of the board in 2016. Jan Boone and his wife Isabelle Maes are the only family members with operational functions at Lotus Bakeries. Jan Boone is the CEO, Isabelle Maes heads the Natural Foods division. “We prefer family management, but only at the level of the global management committee, justifies Jan Boone. It would not be good for family members to be scattered at different levels of the company, under the authority of people outside the family. I prepared the transition with my uncle and my father for five years. You have to avoid abrupt changes. But as soon as you become a CEO, there is no longer any question of the predecessor still wandering the corridors several days a week. We are very strict on this plan. My father celebrated his 65th birthday on May 21, a Saturday. On May 20, he stopped: he no longer came to the office. One can be as healthy whatever you want, at 65, you retire.” Families cultivate humility. Unlike some other large Belgian family fortunes, no one lives in a castle. From a financial point of view, they are also more transparent than the families at the head of AB InBev, for example. The shares of the family are certainly housed in a foundation under Dutch law, but this always leads to one of the Belgian heritage companies, most of which clearly mention the number of Lotus Bakeries shares. Here, there are no shell companies in Luxembourg or in exotic tax havens. Of course, dividends regularly flow from asset holding companies to shareholders. But it is rarely huge amounts. Wealth companies are mostly healthy, with asset values not reflecting the current market value of Lotus Bakeries. Despite this humility, the families jealously maintain their connections with the Flemish business networks. Evidenced by several marriages of convenience with successful businessmen. Benedikte Boone is the spouse of Francis Eeckhout, CEO and main shareholder of listed building materials manufacturer Deceuninck. Sofie Boone, CEO Jan’s sister, is the manager of a pharmacy. Her husband Joseph Baert (51) owns a consulting firm specializing in family transfers and is chairman of the board of Bekina, a boot producer in the Flemish Ardennes. Evelien Boone (51), daughter of Stanislas Boone, is married to Philippe Vandeurzen, managing director of De Eik, the asset company of the famous Van Waeyenberge business family. His brother Frederik (49) was married to Annick Draelants, the CEO of sun protection and awning producer Harol in Diest. Frederik Boone is one of the rare scion of the family to do politics, as group leader of the N-VA in Diest. We will also notice the presence of many dentists in the family tree. Administrator of Lotus Bakeries, Johannes Boone (70) owned a dentist’s practice with his wife Hilda Kirsch (70). Kristin, a daughter of Karel Boone, is also a dentist. Stanislas even has two children in this sector: Cathérine (53 years old) and Thomas (46 years old). The latter is a dental technician in Lembeke. Those who eat too many speculoos and other sweets know where to go…