$308 million in net earnings reported
Land O’Lakes Inc. saw record net earnings of $308 million, up from $266 million in 2015.
“Delivering record earnings in the current market environment underscores the strength of Land O’Lakes’ core business strategy,” said Chris Policinski, president and CEO of Land O’Lakes. “This was a record earnings year for Land O’Lakes in spite of challenging commodity markets, declining on-farm income and increasing industry consolidation. Additionally, we completed the largest merger in our company history and extended our global reach to Africa.”
In 2015, Land O’Lakes successfully merged United Suppliers Inc. crop protection and seed business with Winfield Solutions L.L.C. Land O’Lakes also purchased a majority ownership stake in Villa Crop Protection, a leading crop protection products company based in South Africa, the company’s first commercial investment in Africa.
Land O’Lakes had a strong financial year in 2015. The balance sheet is the strongest in its 94-year history. Cash returned to members in 2015 totaled $161 million, the seventh consecutive year that cash returned to members has exceeded $100 million. Net sales in 2015 totaled $13 billion.
For the quarter ending December 31, 2015, Land O’Lakes delivered quarterly sales of $3.3 billion, a slight decrease in year-over-year sales. Net earnings for the fourth quarter were $119.4 million, with Dairy Foods, Feed and Crop Inputs delivering strong quarterly earnings well ahead of the same quarter in 2014.
Feed reported 2015 net sales of $4.2 billion, down from 2014. However, pretax earnings of $57.8 million in 2015 were up from $27.8 million in 2014. The core Purina-branded feed lines delivered record-setting performance as a result of the execution of operational strategies that drove market share and accelerated growth. The business experienced growth in all customer channels. Land O’Lakes also launched PMI Nutritional Additives, a new segment of the business focused on products that optimize nutrient utilization and gut health and integrity.
Crop Inputs reported 2015 net sales of $4.8 billion in 2015, down slightly from 2014. Pretax earnings totaled $189.6 million in 2015, down from 2014. Low commodity prices impacted results across the portfolio and was offset to some extent through strength in CROPLAN corn, soybeans and alfalfa. The business continued to focus on productivity, sustainability and decision tools to help farmers make the right choices to increase on-farm productivity using fewer resources. The business introduced nine new products, experienced a strong year for data at more than 200 Answer Plot locations across the country and world, and provided greater access to data and insights through decision technologies like the R7 Tool and AnswerTech platform.
Additionally, Land O’Lakes completed the divestiture of the commodity egg business, operated through Moark L.L.C., which contributed pre-tax earnings of $13 million.