St. Paul / MN. (chs) CHS Inc., the United States’ leading agricultural co-op and a global energy, grains and foods company, reported net income of USD 775.9 million for the fiscal year that ended Aug. 31, 2018. «Our fiscal 2018 results show the progress we are making on the priorities we set for CHS», said Jay Debertin, CHS president and chief executive officer. «Our year-over-year financial performance shows good improvement, our balance sheet is solid, and our relationships with cooperative owners are strong. The diverse CHS business platform allowed us to deliver improved earnings and enables us to return USD 150 million in cash patronage and equity redemptions to owners even as we navigated challenging market conditions».
Key financial highlights
Key financial highlights for the fiscal year that ended Aug. 31, 2018, include:
- Net income of USD 775.9 million, an increase of USD 704 million from the previous fiscal year.
- Consolidated revenues of USD 32.7 billion, a USD 646 million increase from the previous fiscal year.
- Pretax income of USD 671.2 million, an increase of USD 781 million from fiscal 2017.
- Energy gains driven by higher refinery margins and favorable crude oil discounts.
- Disposal of assets resulted in cash proceeds of approximately USD 234.9 million and a pretax gain of approximately USD 131.8 million. The cash proceeds were used to optimize debt levels.
- A tax benefit through revaluation of the company’s U.S. net deferred tax liability as a result of the Tax Cuts and Jobs Act in 2017.
«As we move into fiscal 2019, we continue to build on the momentum and strong performance we started in fiscal 2018. This includes evolving and growing our core businesses in a changing marketplace and capitalizing on the value of this diverse organization to make CHS our owners’ and customers’ first choice», said Debertin. «We are focused on serving those who grow food to feed the world».
In October, CHS filed an 8-K with the Securities and Exchange Commission (SEC) announcing that it would restate its audited consolidated financial results for fiscal years 2015, 2016, 2017 and its unaudited consolidated financial results for the first three quarters of 2017 and 2018. The restatement was necessary to correct material misstatements related to valuation and accounting for certain rail freight contracts. The misstatements were discovered as a result of an investigation the company conducted through external counsel and under the oversight of the Audit Committee of its Board of Directors. Appropriate personnel actions were taken, based on the investigation’s findings. All overstated non-cash values have been written off and appropriately reflected in the company’s restated financial results. Additional information can be found in the form 10-K filed with the SEC.