Net income for the quarter (Sept. 1 - Nov. 30, 2006) compared with $154.2 million for the same period a year ago. Revenues for the quarter were $3.8 billion, an increase from $3.5 billion for the first quarter of fiscal 2006.
CHS earnings reflected solid performance within each of its three business segments. Energy earnings remained strong, but declined for the first quarter of 2007, reflecting reduced margins for gasoline, diesel and other refined fuels as markets eased from historic highs a year ago. Within the energy segment, CHS propane, lubricants, renewable fuels marketing and transportation businesses exceeded fiscal 2006 performance.
Earnings increased within the Ag Business segment, consisting of CHS agronomy, local retail facilities and grain marketing operations. CHS retail operations reported strong performance for the first quarter of fiscal 2007 due to increased sales of farm inputs and energy products, along with good grain movement. The company's grain marketing operations also recorded earnings ahead of fiscal 2006 due to continued expanded domestic and global demand and high grain prices. Within agronomy, depressed nitrogen fertilizer markets affected earnings. CHS also recorded a $5.3 million gain on its sale of a portion of its shares of CF Industries, a crop nutrients manufacturer.
Within its Processing segment, earnings generated by oilseed processing and the company's portion of the Ventura Foods, LLC, contributed to a solid first quarter fiscal 2007 for CHS.
CHS Inc. (Nasdaq: CHSCP) ( http://www.chsinc.com ) is a diversified energy, grains and foods company committed to providing the essential resources that enrich lives. A Fortune 500 company, CHS is owned by farmers, ranchers and cooperatives from the Great Lakes to the Pacific Northwest and from the Canadian border to Texas, along with thousands of preferred stockholders. CHS provides products and services ranging from grain marketing to food processing to meet the needs of customers around the world. It also operates petroleum refineries/pipelines and, through a broad range of working partnerships, markets and distributes Cenex(R) brand energy products and renewable fuels, along with agronomic inputs and livestock feed to rural America. CHS is listed on the NASDAQ at CHSCP.
This document contains forward-looking statements within the meaning of The Private Securities Litigation Reform Act of 1995 that are based on management's current expectations and assumptions. These forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from the potential results discussed in the forward-looking statements. The company undertakes no obligations to publicly revise any forward-looking statements to reflect future events or circumstances. For a discussion of additional factors that may materially affect management's estimates and predictions, please view the CHS Inc. annual report filed on Form 10-K for the year ended Aug. 31, 2006, which can be found on the Securities and Exchange Commission web site ( http://www.sec.gov ) or on the CHS web site http://www.chsinc.com .
CHS Inc. Earnings
By segment
(In millions $)
Sept. 1 - Nov. 30
1stQ 2007 1stQ 2006
Energy 111.3 146.0
Ag Business 28.1 16.7
Processing 10.6 9.9
Corporate and Other 3.5 2.2
Taxes (17.2) (20.6)
Net Income $136.3 $154.2
