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CHS Reports Lower Quarterly Earnings
Wisconsin Ag Connection - 07/13/2015

CHS Inc., the nation's leading farmer-owned cooperative and a global energy, grains and foods company, reported earnings of $649.6 million for the first three quarters of its 2015 fiscal year. That's a decrease of 26 percent from the $881.7 million reported for the first three quarters of fiscal 2014.

The company says revenues for first nine months of fiscal 2015 were $26.6 billion, down 19 percent from $32.7 billion for the same period a year ago, primarily due to lower average prices for the refined energy products, grains and fertilizer that make up a significant portion of CHS business.

Earnings for the third quarter of fiscal 2015 were $178.1 million, down 53 percent from $379.5 million for the same period of fiscal 2014. The third quarter of fiscal 2014 included a one-time gain of $108.8 million attributed to the establishment of the Ardent Mills flour milling joint venture in May 2014. Fiscal 2015 third quarter revenues of $8.7 billion declined 28 percent from the same three-month period a year ago.

For the first nine months of fiscal year 2015, Energy segment earnings declined primarily due to significantly reduced refining margins and scheduled maintenance at its McPherson, Kan., refinery, along with, to a lesser extent, decreased propane earnings.

CHS Ag segment earnings through the third quarter also declined. This decrease was attributed to lower earnings from logistics within grain marketing compared with the first three quarters of fiscal 2014, as well as lower grain and wholesale crop nutrients volumes. In addition, through the third quarter of fiscal 2015, CHS retail facilities experienced lower agronomy margins. Earnings for CHS renewable fuels marketing and production operations declined due to lower market prices which resulted in lower marketing commissions; those lower earnings were partially offset by the 2014 acquisition of a Rochelle, Ill., ethanol plant.

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