ANNUAL REPORT

2013

Dear Agros Family:

Agros builds the last mile. That’s the way I sum up our work when asked. Here’s what it means.

When I worked in the telecommunications industry, the perennial challenge was how to build a business case for the so-called “last mile.” In other words, the cost of getting the signal from a high-capacity cable to the individual consumer (the “last mile”) greatly exceeded, in the short run, the revenue derived from that one individual.

In the world of international development today, there are many organizations focused, metaphorically, on building high-capacity fiber optic cables. Pick up almost any annual report, for example, and you will be blitzed with stunning advancements in medicine and technology. All of this work is foundational, much like the need to build the backbone of the internet. Yet, someone still has to build the critically important last mile.

For over thirty years, we have built the last mile. We focus on depth and lasting impact. Our approach may be countercultural, but it is incredibly effective. When that connection is made, lasting, generational transformation takes hold.

Letter from Our President

We understand

that behind all

our numbers and

technology is a

human being,

and without

a committed,

lasting

relationship,

without a “last

mile connection”

to that human

being, no change

will occur.

Letter from Our President

I met Johnathon a year ago while visiting the village of Tierra Nueva in Nicaragua. Like many of the men in the community, Johnathon braved the risk of taking on a land loan with the hope of turning a couple of acres of raw land into a livelihood. Using nothing more than hand-held gardening tools, Johnathon transformed his dirt and grass lot into a spectacular crop of peppers. More importantly, Johnathon knew to the penny how much he had invested in the land, seeds and fertilizer, and how much he had earned.

He had even begun to calculate the various returns on his investment based on his ability to increase the pepper production per plant. Johnathon not only learned how to grow peppers, he learned how to run a business. But the most amazing thing: Johnathon is only 16 years old!

People matter. Johnathon is a successful entrepreneur because of his connections to other people: people like you who fund his business; people like the Agros staff who provide technical support; and people like the families in Johnathon’s community who provide emotional support.

Reaching as many people as possible without losing this last mile connection is our goal in the coming years. That is why we have invested in strategically scaling our model without diluting its impact. In Tierra Nueva, we have proven that the model can be scaled from 100 people to over 700 people. Now, we are launching a new regional project in Nicaragua that will reach 5,000 additional people in the next seven years.

You are the reason this work and this commitment is possible. You have entrusted us with your time, talent and resources. With your continued support, we will build that last mile connection to every person who needs it.

Thank you and God Bless,

Don Manning President & CEO

Land. Hope. Life.From its founding, Agros International has recognized that secure access to land is critical to providing small-holder farmers in Central America with economic security and resiliency. However, land access needs to be accompanied by other critical investments to insure a sustainable pathway out of poverty.

The Agros development model combines secure access to productive land with a package of essential assistance uniquely crafted for the specific farmer and his family. This package includes: decent housing, clean water, access to capital, hands-on training in modern agricultural techniques, and basic health services. This integrated, holistic suite of services coupled with access to land creates the opportunities for a productive and sustainable livelihood.

Start small. Big ImpactFor years, Agros has been partnering with small communities in Central America and Mexico with an average village size of 30-50 families.

In 2011, Agros launched an exciting new project in the Matagalpa region of Nicaragua, reaching 150 families. Today, Tierra Nueva is thriving. The community is benefitting from a large-scale water system, significant improvements in health and nutrition, and burgeoning agricultural productivity.

Building on this success, Agros is preparing to launch its largest project to date, reaching more than 800 families in northern Nicaragua.

As Agros seeks to reach more families with its unique integrated rural development model, we are committed to identifying evidence-based practices to ensure that we are optimizing our resources and fulfilling our mission as effectively as possible.

Meet Enrique Enrique Ramirez has lived in the Agros community of La Piedra de Horeb, Honduras for more than five years. Like most new arrivals in an Agros community, Enrique’s first task was to plant, cultivate and harvest basic grains that would feed his family of eight. With food security addressed, Enrique focused on his agri-business. Learning about methods and markets from Agros staff, he began cultivating high-quality cacao (cocoa). Soon, Enrique was able to provide his family both food security and financial stability.

Enrique faced additional transition challenges. His wife and children, ranging in age from six to 28, struggled in the new community. As a result, Enrique’s wife and three youngest children moved back to the town of Arenales, raising chickens and pigs. Enrique ends most days travelling several miles to fulfill his role as a husband, father, and provider.

Enrique’s boundless energy is focused on improving his farm’s production. Sixty miles inland, and more than two thousand feet above sea level, Enrique now raises an improbable food: tilapia. Tilapia is a healthy source of proteins and other nutrients. A visitor asked Enrique why he chose fish. “It’s very simple,” he said. “Tilapia arrive as small fingerlings, barely as long as my first finger. Within 90 days, they are ready for market, and I can continuously grow and harvest, grow and harvest. Market prices are very high; tilapia are very profitable.”

When asked about the challenges of raising tilapia, he answered quickly “The birds! Especially when the fish are small, birds try to feed on my stock.” He has two solutions to the bird problem: a net over the ponds, and singing. Enrique sings to the fish while tending the ponds. “Singing scares away the birds… and I think it makes them grow faster too,” he smiles.

Three of Enrique’s children still live in Arenales with his wife. Irving is 17 and training to become an electrician. Ruben (15) and Norlin (6) attend primary school. None of this would have been possible without financial resources from their farm. Enrique is an innovative farmer, family provider, and recently became a pastor in the community. Like many other Agros families, Enrique’s story is one of hope and a future bright with opportunity.

Innovation and CollaborationIn 2013, Agros made significant strides toward the enhancement of its program model, investing in a comprehensive capacity development initiative. Agros brought together field leaders in multiple disciplines to build on the many strengths of the Agros program model, and identify opportunities for increased impact.

Toward this goal, Agros convened a workshop in summer 2013, where the Agros team worked alongside a team of technical specialists and partner organizations (including PATH and Catholic Relief Services) to assess and strengthen the Agros program model.

Since the workshop, Agros and its partners have continued to identify and implement new approaches, techniques, and strategies to push beyond its current successes, expand its reach, and improve on its fundamental mission “to see rural families own agricultural land, attain economic self-sufficiency, realize their God-given potential, and pass on to future generations the values and resources that enable them to flourish.”

LAND

Highly skilled agronomists provide families with the technical expertise, agricultural inputs and market information needed to successfully cultivate, harvest and sell cash crops.

MARKET-LED AGRICULTURE

Credit officers customize financial products to meet the cash flow and seasonal needs of the families to

ensure business success and to teach basic financial literacy like budgeting, saving and investing.

FINANCIAL EMPOWERMENT

Human development officers provide emotional, psychological and spiritual support while fostering community ownership of preventive healthcare, good nutrition and proper sanitation and hygiene.

HEALTH & WELL-BEING

FY13 Financial Results OPERATING REVENUES $4,092,405Unrestricted Gifts $858,9267

Gifts & Other Revenues Released From Restrictions $3,078,847

In-kind Contributions $7,980

Other Income $146,652

OPERATING EXPENSES $4,249,936Program $3,105,967

Resource Development $778,447

Administration and General $365,522

TOTAL INCOME $4,012,798Operating Revenues $3,105,967

Temporarily Restricted Gifts and Other Revenues $88,877

Permanently Restricted Gifts $9,270

NET ASSETS AT JUNE 30 $5,448,062Unrestricted Net Assets, invested In Land & Equipment $140,867

Unrestricted Net Assets, Designated For Land Purchases $199,177

Unrestricted net assets, designated for programs $132,500

Unrestricted Net Assets, Undesignated $724,726

Temporarily Restricted Net Assets $2,840,176

Permanently restricted net assets $1,420,616

Agros International is exempt from federal income tax under Section 501( c) (3) of the Internal Revenue Code; contributions to Agros International are tax-deductible. Because Agros receives pledges for village support that extend over multiple years, temporarily restricted funds may show significant surpluses in years when support is pledged or deficits in years when pledges are paid and funds are used in village development. Agros International’s audited financial statements are available upon request.

Individuals62%

Businesses4%

Other income4%

20%Foundations

11%Churches

Sources of Revenue

Chair

Vice Chair

Secretary

Members

FOUNDER

EXECUTIVE LEADERSHIP

FIELD LEADERSHIP

Chi-Dooh “Skip” Li—Partner Ellis, Li & McKinstry, PLLC law firm

Don Manning—President & CEO

Anne Baunach—Director of Resource Development

Kevin Pepper—Director of Program

Janet Stafford—Director of Finance and Administration

Joel Martinez—Regional Program Director

Boris Corpeño—Regional Director of Economic Develop-ment

Sharon McField—Human Resources Coordinator

Paul Moulton—Executive VP & CIO Costco Wholesale Corporation

John Friedery—Retired SVP—Ball Corporation

Brad Smith—Former Owner Dynamic Data Systems

Dustin Brumbaugh—SVP, Director of Research D.A. Davidson & Co.

Shaun Corry—Vice President and Chief Compliance Officer Lesa Sroufe & Co

Gary Darmstadt—Senior Fellow, Global Development Bill and Melinda Gates Foundation

Dawn Hagen—Sr. Manager Global Marketing and Communications, Microsoft

Susanna Hoke—Community Volunteer

Mark Weber—Owner Weber Marketing

BOARD OF DIRECTORS

2225 4th Avenue, 2nd FloorSeattle, WA 98121 USA206.528.1066 www.agros.org