CHS reports strong fiscal year 2022 earnings
Net income of $1.7 billion and revenues of $47.8 billion exceed previous records
November 23, 2022
CHS Inc., the nation's leading agribusiness cooperative, recently reported net income of $1.7 billion for the fiscal year ended Aug. 31, 2022, compared to $554.0 million for fiscal year 2021.
Key financial drivers for fiscal year 2022 results include:
• Consolidated revenues of $47.8 billion for fiscal year 2022 compared to $38.4 billion for fiscal year 2021, a year-over-year increase of 24 percent.
• Refining margins in our Energy segment were higher and drove improved earnings due to the tightening global supply and demand landscape.
• The CHS global grain and processing and wholesale agronomy businesses within our Ag segment benefited from strong global demand and increased margins.
• Our equity method investments performed well, with increased CF Nitrogen earnings resulting from strong global demand for urea and urea ammonium nitrate, coupled with decreased global supply.
"We appreciate the support of our member cooperatives and farmer-owners, which enabled us to deliver a substantial increase in earnings for the fiscal year, while also helping feed people around the world," said Jay Debertin, President and CEO of CHS Inc. "Additionally, our employees demonstrated their dedication to helping our owners and customers succeed in a turbulent year for agriculture. As a result of these collective efforts, CHS intends to return $1 billion in cash patronage and equity redemptions to our member cooperatives and farmer-owners in fiscal year 2023, reflecting the company's financial strength and demonstrating the value of cooperative ownership."
"We are proud of our role in the cooperative system. We will continue to make investments that strengthen rural America and help our farmer-owners and customers meet the growing demand for agricultural products. Our investments in infrastructure, supply chain capabilities, people and innovation are driving operational and efficiency gains throughout our expansive network," Debertin added. "Although economic uncertainty, logistical challenges and inflationary pressures remain, CHS is well-positioned to maximize value for our member cooperatives and farmer-owners."
Fiscal year 2022 business segment results
Energy Pretax earnings of $616.6 million represent a $627.1 million increase versus the prior year and reflect:
• Higher refining margins and increased discounts on heavy Canadian crude oil processed by our refineries contributed to a significant increase in our refined fuels business income; these increases were partially offset by higher renewable energy credit costs and higher natural gas costs, as well as lower margins in our propane business.
Pretax earnings of $657.6 million represent a $359.5 million increase versus the prior year and reflect:
• Increased margins across all our Ag segment product categories, due to strong global market demand and global supply disruptions
• Continued favorable markets for oilseed processing, which were bolstered by robust meal and oil demand
• Increased revenues from feed and farm supplies, despite less favorable weather during spring planting and application season
Pretax earnings of $478.0 million represent a $357.0 million increase versus the prior year and reflect:
• Increased earnings from our strategic investment in CF Nitrogen, primarily due to market conditions and strong demand for urea and UAN, factors that were partially offset by higher natural gas costs
Corporate and Other
Pretax earnings of $57.9 million represent a $48.9 million decrease versus the prior year and reflect:
• Lower earnings primarily from our Ventura Foods joint venture, which experienced less favorable market conditions for edible oils.
CHS Inc. (www.chsinc.com) is a leading global agribusiness owned by farmers, ranchers and cooperatives across the United States. Diversified in energy, agronomy, grains and foods, CHS is committed to creating connections to empower agriculture, helping its farmer-owners, customers and other stakeholders grow their businesses through its domestic and global operations. CHS supplies energy, crop nutrients, seed, crop protection products, grain marketing services, production and agricultural services, animal nutrition products, foods and food ingredients and risk management services. The company operates petroleum refineries and pipelines and manufactures, markets and distributes Cenex® brand refined fuels, lubricants, propane and renewable energy products.