KANSAS CITY, MO (PRN)--More than 2,500 member-owners, employees and business partners of Farmland Industries met at Bartle Hall in Kansas City this week, bringing approximately $2.6 million to the local economy.
Members of the regional cooperative reviewed the company's fiscal 2001 accomplishments and heard president and CEO Bob Honse share his vision for the future.
In the General Session held Dec. 5, Honse delivered an address entitled "Straight Talk" in which he described the company's five-year financial history and the progress made in 2001 toward long-term financial strength.
Honse described fiscal 2001 as a year of re-building for the cooperative, as management focused on reducing debt and strengthening the balance sheet. Debt was reduced $268 million; corporate expenses were cut more than 50 percent; pre-tax operating income increased $66 million; and cash flow from operations increased more than $400 million. One-time, primarily non-cash restructuring charges of $80 million were reported as the company strengthened its balance sheet, resulting in a net loss of $90 million.
"In fiscal 2002, we will continue the hard work begun this year. We will make additional gains in operating income, further reduce debt, and achieve additional reductions in corporate and administrative expenses," Honse said.
Honse said Farmland will work with its partners to strengthen operations in agricultural marketing joint venture companies Agriliance, ADM-Farmland Inc., and Land O'Lakes Farmland Feed.
"Your Farmland was part of the first grain sale to Cuba in more than 40 years," Honse told the audience of producers and local cooperative managers. "The wheat came from your fields and your elevators. We are proud to be part of this historic transaction, which was made possible by our successful grain partnership with ADM."
According to Honse, Farmland will continue to improve profitability in its Crop Production division, which manufactures nitrogen- and phosphate-based fertilizers. "Our Coffeyville, KS, nitrogen plant, which uses petroleum coke instead of natural gas in the production of ammonia, was on-stream 100% through the month of November. We expect this plant to operate well this year, and we will reap the benefits of this facility's very low cost of production."
Farmland also plans to further reduce costs in its food companies by making its plant operations even more efficient. In fiscal 2001, the company closed two inefficient pork plants and opened three new pork and beef CaseReady facilities, changing its plant configurations in order to meet changing customer demand. Investments in advertising and promotions to further build Farmland(R) brand pork, beef and catfish products to national brand status will remain at the forefront of the company's efforts.
Through aLF Ventures, a joint venture between Farmland National Beef and DMV USA, the company expects to bring activated lactoferrin, a revolutionary food safety technology, to consumers later this year.
Honse closed the meeting by thanking the cooperative's membership for their confidence in his team. "We made significant progress in fiscal 2001 but there is much work to be done. I am confident we will continue to earn your trust."