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CHS Reports First Quarter Fiscal 2019 Net Income

Net income of $347.1M, an increase of $159.9M

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CHS Inc., a leading farmer-owned cooperative and a global energy, grains and foods company, has reported a net income of $347.1 million for the first quarter of fiscal 2019.

"Our strong first quarter results position us well as we start our 2019 fiscal year," says Jay Debertin, CHS president and chief executive officer. "We are focused on making CHS our customers' first choice by advancing our technology solutions and equipping employees to meet the changing needs of our customers around the world. We will do this while maintaining financial discipline and rigor."

Key financial highlights for the quarter that ended Nov. 30, 2018, include:

  • Net income of $347.1 million, an increase of $159.9 million from the restated first quarter of fiscal 2018.
  • Consolidated revenues of $8.5 billion, a $452.4 million increase from the restated first period of fiscal 2018.
  • Pretax income of $367.2 million, an increase of $159.4 million from the restated first period of fiscal 2018.
  • Improved crude oil pricing, which drove higher refining margins.
  • Favorable market conditions in the crop nutrients business, which resulted in higher margins.
  • Improved earnings in the company's CF Nitrogen, Ardent Mills and Ventura Foods investments.

First Quarter Fiscal 2019 Segment Results
The following segment results were reported for the first quarter of fiscal 2019 as compared to first quarter fiscal 2018.

The $112.0 million increase in Energy pretax earnings reflects the following:

Improved market conditions in the refined fuels business driven by favorable crude oil pricing.

The $5.1 million increase in Ag pretax earnings was driven by the following:

Improved pricing within the company's crop nutrients and processing and food ingredients businesses and volume increases within grain and processing.

The $18.0 million increase in Nitrogen Production pretax earnings reflects the following:

Improved margins within the Nitrogen Production business driven by increased sales prices of urea and UAN, which are produced and sold by CF Nitrogen.

The $24.3 million increase in Corporate and Other pretax earnings reflects the following:

Higher earnings from the company's investments in Ventura Foods, LLC and Ardent Mills, LLC as well as increased interest revenue from the company's financing business.

In late December 2018, CHS, a 25% owner of West Central Distribution, exercised its option to purchase the remaining 75% of the respected crop protection distribution company and is in the process of completing due diligence and satisfying regulatory, legal and other requirements.

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