Company cites change, challenge and transition for decline
Land O’Lakes Inc. reported net sales of $14.9 billion and net earnings of $255 million for the year ending December 31, 2018, compared with net sales of $13.7 billion and net earnings of $365 million in 2017. The company’s net earnings included a non-recurring charge for the estimated withdrawal liability associated with its participation in a multi-employer pension plan. Excluding the effect of this charge, the company’s fiscal year net earnings were $309 million.
“As Land O’Lakes Inc. and many others in our industry navigated a year marked by change, challenge and transition, we continued building on core strategies for future success in a changing marketplace,” said Beth Ford, president and CEO of Land O’Lakes. “With a strong foundation built on technology, differentiated services and a world-class branded products portfolio, we enter 2019 well positioned to lead farmer-to-fork innovation in unique and unexpected areas.”
In 2018, Dairy Foods capitalized on its focus on growth areas in the sector. Marketplace-back, on-trend convenience foods, along with snack, desserts and food service delivered strong performance, which helped offset lower retail product mix and compressed margins on milk powders. In Animal Nutrition, insights and breadth of the product offering along with improved premix margins helped mitigate a challenging livestock environment in which producers were sometimes trading down. Business results in Crop Inputs and Insights were lower, reflecting increased competitiveness and a shift in product mix attributed to low commodity markets and the general decline of farm income. The Land O’Lakes SUSTAIN business, launched by Land O’Lakes to help farmers mitigate environmental impact while increasing potential profits, welcomed new customers and new partnerships throughout the year.