ST. PAUL, MINNESOTA, U.S. — CHS Inc. announced on Nov. 5 earnings for fiscal 2014 of $1.1 billion, the second highest in its history.
Earnings were up 9% from the $992.4 million reported in fiscal year 2013. CHS attributed the increase to strong energy earnings, global agricultural expertise and record local retail operations performance. Revenues for the year were $42.7 billion, down 4% from $44.5 billion for fiscal 2013, primarily due to lower values for commodities the company handles, including refined fuels, grain and oilseeds.
"Even as we experienced an overall softening of the global agriculture and energy sectors during fiscal 2014, CHS continued to focus on and deliver what it does best: value that helps our farmer- and cooperative-owners grow," said Carl Casale, president and chief executive officer. "We fulfilled that commitment by continuing to make significant investments in the future of our businesses; providing significant direct economic returns and maintaining a strong financial foundation for the future."
Year-over-year earnings for the CHS Energy segment declined during fiscal 2014, due to lower refining margins for much of the year for the company's two refineries. The segment also included record performance for other energy businesses, including propane, lubricants, renewable fuels marketing and transportation.
CHS Ag segment earnings for fiscal 2014 increased, reflecting the company's core competencies in logistics and risk management which enabled it to maximize volumes and earnings for its global grain marketing and wholesale crop nutrients operations. In addition, significant crop inputs and services business, along with strong grain margins, contributed to record earnings for CHS Country Operations local retail, animal nutrition and sunflower businesses. CHS Processing and Food Ingredients business earnings declined in fiscal 2014, compared with 2013, primarily due to non-cash asset impairment charges.
CHS reports results for its business services operations and two food processing-related joint ventures under the Corporate and Other heading. Overall earnings increased in fiscal 2014 compared with the previous year.
Combined earnings for CHS insurance, risk management and financing businesses declined in fiscal 2014 compared with fiscal 2013, largely due to market volatility and commodity prices which affected borrowing and hedging activity. Earnings contributions to CHS for fiscal 2014 reached high marks for the company's 50% ownership of Ventura Foods, LLC, a vegetable oil-based food manufacturing business, and its 12 percent share of Ardent Mills, a wheat milling venture. CHS recorded a $109.2 million gain associated with formation of Ardent Mills in May 2014.
In fiscal 2014, based on fiscal 2013 earnings, CHS returned a record $637.2 million to its owners in cash patronage, equity redemptions, preferred stock and dividends on preferred stock to its owners. This included a one-time retirement of $200 million in qualified owner equity with preferred stock.