ST. PAUL, MINNESOTA, US — CHS Inc. sustained a loss of $38.2 million in the second quarter ended Feb. 28, as ongoing COVID-19 pandemic-related impacts continued in the Energy segment.
In the same quarter a year ago, CHS reported net income of $125.4 million. For the six-month period, CHS posted net income of $31.4 million, which compared with $303.3 million in the same period a year earlier.
Revenues for the first six months of 2021 increased nearly 20% to $17 billion.
“I am encouraged by the resilience of our employees and their commitment to owners in what continues to be a challenging operating environment,” said Jay Debertin, president and chief executive officer of CHS Inc. “We are cautiously optimistic about the rollout of COVID-19 vaccines and other progress being made in response to the pandemic in the US and around the world and the potential impact on our domestic and global businesses.”
Significant year-over-year earnings increases in Ag and Nitrogen Production segments and Corporate and Other businesses were offset primarily by ongoing COVID-19 pandemic-related impacts in Energy.
“Improved trade relations between the United States and foreign trade partners combined with our operating efficiency initiatives led to record grain and oilseed volume increases and continued price gains, significantly improving our Ag segment earnings over the prior year,” Debertin said. “Additionally, favorable growing conditions and overall strength in agriculture, helped drive demand for crop inputs, including crop nutrients and crop protection products and services.
“Our Energy segment, while showing improvement over the previous quarter, continues to experience unfavorable refined fuels market conditions related to the COVID-19 pandemic and exceptionally higher costs for renewable energy credits. These factors resulted in volume and margin declines that significantly reduced earnings compared to the prior year.”
The Ag segment saw favorable weather and improved relations between the United States and foreign trade partners, including China, which increased volumes of grain and oilseed commodities as well as feed and farm supplies.
In addition, there were higher margins for certain agricultural products, including processing and food ingredients, which improved because of soybean crush strength.
“As we look ahead to the second half of fiscal 2021, we remain committed to protecting the financial health of CHS, adding efficiency throughout our enterprise to benefit owners and customers, and caring for those who depend on us as we continue creating connections to empower agriculture,” Debertin said.