On Board With The Chairman - July 2025

Dear Member-Owners,

‍

The Board of Directors held its monthly meeting this past Tuesday at the Visalia headquarters with a full agenda ahead of them. We had some big committee meetings the day before as well, with the finance committee and the commercial committee both on the schedule that day.

 Brad Anderson was the first to present on Tuesday. He and Rob Vandenheuvel kicked off the meeting with the introduction of our newly hired Chief Operating Officer (COO), Panna Agrawal. Panna joined CDI on July 7and has been busy diving into the plants, touring each of them, and getting himself familiar with our assets and how they work. Panna brings a wealth of knowledge to this position, with tremendous experience in dairy manufacturing. The board and staff are excited to engage with him and get him going. Please keep Panna and his family in your prayers as they make the move from the Bay Area to the valley and settle in. Brad also provided some updates on the markets, looking at the year-to-year trends and some projections on what the markets are shaping up to be. Brad also provided the board with a deep dive, which his team had prepared, on our assets and if and how we could better utilize each plant and its capabilities.

Jason Allen then presented the financials for the month of June and year-to-date. June results were slightly lower than forecasted. The board had a lengthy discussion on the market adjustment being deducted from our member milk checks and the primary factors that the board and management need to watch as we navigate the remaining months of 2025. Based on what we know today, members should not expect a change in that adjustment in the next few months. There are multiple variables that will impact CDI’s end-of-year financial position, and we likely need results through the first three quarters before re-examining the adjustment to milk checks.  The market adjustment is something that the board will continue to look at going forward. This isn’t the news that we want to present, but it’s what we’re currently facing.

Michael Burdeny was next to present. He covered everything, from our powder and butter production to what has been going on at Valley Natural Beverages (VNB). Unfortunately, VNB still has two lines that are pending their final stamp of approval from the California Department of Public Health. This issue has nothing to do with our team or the processing systems installed at VNB and has everything to do with that California department not holding its staff accountable. It serves as a reminder of the legitimate reasons why companies are increasingly investing outside of California. We’ve been using all of our leverage to try and push this through the final process, but we’re in a wait-and-hold pattern until that certification comes through, which is hopefully any day now.

Rob closed out the meeting, providing an update on our plant operations. He’s been working closely with Panna for the last three weeks on Panna’s onboarding and introducing him to the plant staff. Rob has also been busy working with Brad on the transition to the CEO position and has updated the board accordingly. Rob provided updates on some smaller plant projects that are nearing completion, as well as policy updates requested by the board for his review.

 As summer comes to an end and the kickoff of a new school year approaches, I hope everyone was able to spend some quality family time together. I pray that for those of you who are sending kids off to college, God will bless them in whatever they set out to do. I pray that He guides them and keeps them all safe, letting them be lights of hope on their campuses. We pray for a smooth transition for the local kids as they start a new school year, and for the teachers and administrators to have a successful year as well.

 Please feel free to reach out to me or any of your board members with any questions you have.

All the best,

Cory Vanderham

Chairman of the Board

Vanderham West Dairy

Lazy V Farms

559-269-9618

‍