November 30, 2020

Looking at the Up Side of Down

Editors note: MaxYield Cooperative’s annual meeting will be held Tuesday, December 16th. The event starts at 9:30 a.m. with coffee and cookies, the business meeting will start at 10:00 a.m. and conclude prior to 11:00 a.m.

MaxYield Cooperative has finished another successful fiscal year, thanks to you, our members and clients. While earnings were down a little, we were still able to do the things we want to do financially to serve you better, including upgrading assets, retiring equity, and retiring term debt.

It was a challenging environment in a few areas of our business, including grain, which led to lower earnings. On July 31, 2014, local earnings totaled more than $2.1 million, compared to more than $4.2 million the previous year. Still, your MaxYield board was able to:

• Invest nearly $6.4 million in facilities and equipment, including rolling stock, throughout the company. Because of these expenditures, the board chose to retain some of the
2014 earnings but pay a higher percent of the patronage allocations (50%) in cash.

• Retire more than $900,000 of previously allocated patronage.

• Approve the allocation of $502,538 to MaxYield’s members, with 50% ($251,269) to be paid in cash.

At the end of fiscal year 2014, MaxYield’s balance sheet showed $32 million of working capital, term debt of $18.6 million, local equity of more than $35 million, and a local leverage factor of 52.9%. In one year, it’s quite possible the local leverage factor could be below 45%. It has been a long time since MaxYield has enjoyed such a local leverage number.

It’s also worth looking at our fiscal year numbers in terms of history. At the close of fiscal 2014, MaxYield’s retained savings totaled more than $34.6 million, up from retained savings of -$122,242 on July 31, 1997. This is progress!

Planning for the future
I’m pleased MaxYield’s 2014 financial results are keeping your cooperative on the right track as we move forward. Your board remains focused on a balanced approach of upgrading assets, retiring term debt, and revolving previously allocated MaxYield patronage.

I see reason for optimism as we move into the next fiscal year. We’ll have a good crop to handle and there will be some drying revenue. Even though the ag economy is cooling, I believe 2015 will continue to offer some opportunities, including carry in the market, which will enable us to continue meeting our key objectives.

Thanks for your continued support and patronage of MaxYield. I look forward to working with each of you to continue MaxYield’s success in fiscal 2015. ■

A word from Howard Haas, board chairman
“If you don’t consider the last six or seven years, a $2-million year would be considered a good year. In fiscal year 2014 we increased retained savings significantly, which strengthens the financial stability of your cooperative. We will also maintain our focus on increasing local equity. If you think your cooperative should move in a different direction, I encourage you to make your voice heard. We appreciate your support of MaxYield.” ■

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