GROWMARK Reports Estimated Year-End
Financial Results
CHICAGO
(Sept. 5, 2008) — GROWMARK officials today reported
unaudited, estimated results for the fiscal year that ended
August 31, 2008. Vice President of Finance Jeff Solberg
announced sales of $6.3 billion for the 2007-08 fiscal year,
an all-time record. GROWMARK net income is estimated to be
$312 million, also an all-time record.
“The results from operations include our traditional
wholesale divisions of Seed, Plant Food, Crop Protection,
Energy, and Facility Planning,” Solberg said. “GROWMARK
sales are now 20 percent retail with the operations of
GROWMARK FS and Seedway, both in the Northeast; AgVantage,
New Century, and STAR Energy in Iowa; FS Partners in
Ontario; and Illini FS.”
More than $121 million in patronage refunds will be
returned to GROWMARK member cooperatives. “The results being
achieved are producing the highest income in the history of
your company,” Solberg told GROWMARK shareholders.
Agronomy/Seed Divisions
Plant food product prices were the highest on record for
fertilizer products. High corn and soybean prices supported
strong application rates, and the Plant Food Division posted
its second highest income ever.
“Price risk management has
emerged as a key component of managing this business,”
Solberg said. “Our objective is to provide ‘best in class’
market information and firm price recommendations.”
GROWMARK’s market information and price recommendations
provide guidance for FS member cooperatives’ plant food
purchases.
A 20 percent sales increase and
record income in 2008 were posted by the Crop Protection
Division. Adjuvant sales improved 25 percent, thanks in part
to the launch of an expanded FS product line.
The GROWMARK Seed Division
reported significant growth. Sales topped $180 million and
gross income improved 15 percent. System supported seed
brands were placed on an additional 250,000 acres in 2008,
Solberg said.
Energy Division
The
Energy Division posted its third year of gross income
exceeding $100 million. The division enhanced refined fuel
distribution operations with the purchase of a Menard
County, Ill. terminal. Propane recorded record volume in
2008, for the second year in a row.
GROWMARK sales of FS branded
lubricant products, as well as the United and Archer brands,
are increasing, led by a 20 percent increase in the top
quality FS brand.
Grain Division
Western Grain
Marketing, LLC (WGM) began operations in February 2008 and
construction of a unit train shuttle loader in Adair, Ill.
is progressing. This partnership between Two Rivers FS,
Inc., RIVERLAND FS, Inc., West Central FS, Inc., and
GROWMARK is expected to be fully functional for the 2009
harvest season.
Total Grain Marketing, LLC (TGM)
recorded a strong second year of operations. The partnership
between GROWMARK, Effingham-Clay Service Company, and Wabash
Valley Service Company operates 21 locations in multiple
counties with access to over 40 markets.
Facility Planning and Supply
Division
The cooperative’s
Facility Planning and Supply Division posted increases in
sales and gross income. The division acquired new facilities
in Waterloo, Iowa to add capacity and convenience for tank
and truck manufacturing. Sales of large application
equipment also reached record levels.
Subsidiary Operations
GROWMARK FS, the retail agronomy subsidiary in the
Northeast, had record sales and record income. A focus on
improved efficiency and acquisition opportunities
contributed to higher profitability.
Seedway, a vegetable and farm
seed business headquartered in Hall, NY, produced its sixth
straight year of higher sales and profitability.
Despite significant flooding
this spring, GROWMARK’s Iowa retail units (AgVantage, New
Century, and STAR Energy) reported strong profitability.
Illini FS, the retail division of GROWMARK, will pay
patronage again this year, 50 percent in cash and 50 percent
in stock.
“The GROWMARK Board and FS
member cooperatives have supported significant change in our
business structure and operations over the past decade.”
Solberg said. “The results prove we are not just surviving,
we are thriving because of our ability to be creative and
our willingness to change.”
