Gino De Jaegher is a thrill seeker. A keen sailor who seeks out stormy waters, the native Belgian has a track history of either turning around ventures or starting them up. Remember when Sunny Delight hit our shores? He was the man responsible. Now he has a fresh challenge to sink his teeth into. Last September he joined British Sugar as MD of its UK and Ireland business after 21 years at Procter & Gamble, latterly as head of its paper division, reporting to Gianni Ciserani. He couldn't have joined the UK sugar industry at a more tumultuous time.

Since July 2006, the EU sugar regime has been undergoing painful restructuring. To prevent a glut of sugar in member states, EU producers have been forced to cut production by six million tonnes by 2010 with a view to giving almost 500 developing nations, the majority in Africa, the chance to find a footing in the global market. For a business predominantly UK-based and focused on selling beet sugar products to the food and drink industry as well as sister company Silver Spoon, news that its UK quota would be cut by 165,000 tonnes and that the restructuring levy was going up from €126 per tonne to €173 could have been devastating.

But the ABF subsidiary decided to view it as an opportunity, embarking on a reinvention of its UK business and a tactical overseas expansion campaign to reduce its reliance on beet and increase its global footprint. So far the strategy has paid off - revenue and adjusted operating profit leapt to £1.15bn and £199m last year from £671m and £115m in 2006 driven by its global expansion programme. Compare with this cane sugar business Tate & Lyle's "year to forget", as Citi Investment Research put it, and it is easy to see why De Jaegher thought the offer was too good to refuse.

Joining at such a critical juncture in British Sugar's history and from such a different business culture has not been without its challenges, admits De Jaegher. "I wanted something completely different and boy did I get something different," says the likeable Belgian. But, he adds: "I'm not a man who goes for steady as she goes."

The same could be said of British Sugar - and it will have to continue to diversify to survive, he says. "The challenges from a cost point of view are, first, the production levies imposed by the restructure, second, energy prices and, third, inflation. It puts significant pressure on the sugar industry at large and on us. That's why we've chosen to expand our portfolio. Keeping just sugar beet in the UK wouldn't have been the right choice. At the same time, we're continuing to look at how we can be more efficient in that side of the business."

To that end, it signed up this week to the Carbon Trust's carbon footprinting scheme and, last September, it started production at the UK's first bioethanol plant. Located next to its sugar factory at Wissington near King's Lynn in Norfolk and using sugar beet as feedstock, the plant is now supplying petrol blenders, which in turn supply major supermarket forecourts. British Sugar also announced a joint venture with BP and DuPont to build a world scale plant in Hull, which will open in 2009, using wheat as feedstock.

And biofuels aren't the only lucrative sideline the business has developed. Wissington has become something of a model of sustainability, with basic sugar production at the core of an operation that produces a host of other products, including electricity, topsoil, stones, animal feed, lime and... tomatoes.

It may come as a surprise to many to learn that British Sugar is the biggest grower of classic round and speciality salad tomatoes in the UK. Last year it doubled the size of its glasshouse at Wissington to 11 hectares and now grows about 70 million tomatoes a year using the steam produced in the sugar process that would otherwise be expelled into the air. "We supply Tesco and Waitrose," boasts De Jaegher, hinting that other forms of horticulture could be on the cards. "Salad would be the natural extension. Would we do what we've done at Wissington at our other factories? That's another question."

Yet another is whether to reconfigure its UK processing facilities to handle cane as well as beet, he reveals. Whatever it decides to do, sustainability will be at the heart of British Sugar's evolution, he says. "I have not seen a business that has taken it to the extremes we have. British Sugar has spent £1bn over the past 20 years increasing the efficiency of its business," he says. "It's a big re-platforming of the business and by reducing our dependence on energy we're now self-sufficient in electrical energy needs. We also sell more than 100 megawats of electricity back to the National Grid and have reduced gas and fuel needs by about 40% over the past few years. There's more to British Sugar than sugar these days."

Or Britain it seems. Revenue and profits were up last year largely thanks to the first-year contribution from Illovo Sugar, the African cane-based business in which it bought a controlling stake in 2006, as well as increased profit from China, where it also now has a strong presence in beet and cane production.

British Sugar's international expansion has been astute for two reasons. One, it has helped it counteract the impact of the quota cut and restructuring levy in its European businesses. And two, thanks to the Illovo acquisition, it has allowed it to develop its quota and tariff-free exports to the EU, as four of the six countries in which Illovo operates have Least Developed Country status.

In the short term, however, British Sugar is eyeing markets closer to home, such as the Republic of Ireland, which has renounced its quota. "The sugar reform has incentivised less efficient producers to renounce their quotas, take an EU restructuring aid and stop producing. So there's some volume to be had. We currently supply about a third of the Irish market and plan to increase this further. The other deficit markets are mainly in the southern European belt, Spain and Italy."

Critics have questioned its commitment to the domestic sugar industry after a number of factory closures, however. A row erupted last December when it reopened its York factory for two days in order to demonstrate that it was a fully functioning factory and secure £69m restructuring aid from the EU. This week, the UK Rural Payments Agency confirmed British Sugar was eligible for this aid. But at the time the local press went to town, claiming that none of the additional cash would be given to York workers who lost their jobs. De Jaegher insists the coverage did not tell the full story. British Sugar was within its rights to try and offset a proportion of the expected £330m levies paid to the EU to fund the restructuring programme, he says. "With regards to the human angle, we had put forward significant redundancy packages - one of the union leaders described it as the best he'd ever seen," he adds. "We feel very strongly about our employees."

British Sugar also empathises with its beet farmers, De Jaegher insists, which is why it has agreed to pay them more. Following negotiations with the NFU, it agreed to a price formula linked to current feed wheat prices and the euro exchange rate that could see the beet price hit £24 per tonne in 2009, £4 more than it was last year.

Though profit in its European business is likely to be down this year because of the restructuring levy, British Sugar is "coping quite well", says De Jaegher. "There's an enormous amount of pain that we are going through but there's a bright future for players that are organised and efficient in the first place." So what if there are turbulent waters along the way, he says - that's the way he likes it.n



Snapshot



Name: Gino De Jaegher

Age: 46

Education: Read applied economics in 1984 at the State University Ghent in Belgium and gained a Masters in marketing from Vlerick business school, also in Belgium.

Career to date: Joined Procter & Gamble in 1986 in Belgium, moved through the ranks of marketing, serving as marketing manager for P&G's beauty care category in Turkey from 1990 to 1994. Was marketing director for Sunny Delight's UK launch.

What's your claim to fame? "I brought Sunny Delight from the US to Spain and France before bringing it here. I moved to Newcastle and tested the market in Carlisle from mid 1996 before it was rolled out nationally in 1998."

What do you like doing in your spare time? "One of my hobbies is sailing. I'm not a weaker seas man though. I'm not a G&T sailor - I like heavy weather and some turbulence. I grew up with water."

How does British Sugar compare to P&G? "British Sugar's workforce is older than P&G's, where the average person was in their 30s. It is going through tremendous change and needs to become more agile, more commercially able - that's not where its current strengths lie. It's more agricultural, with a deep understanding of sugar farmers."

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