The first three quarters of Fiscal 2010 set a new profitability record for Weyburn Inland Terminal Ltd. (WIT), driven by both grain handling and a strong crop inputs business, as shown in the company's third-quarter report.
WIT reported after-tax earnings of $4.165 million ($0.78/share) on sales of $96.968 million for the January to September period - up from $839,000 ($0.16/share) on sales of $86.934 million in the same period in Fiscal 2009.The company had solid performances across all operations, but especially from the grain and crop inputs businesses. A dramatic improvement in the performance of NorAmera BioEnergy was a major reason for the year-over-year improvement in profitability, and other diversification efforts in Alliance Grain Terminal and Alliance Seed have also been positive for WIT.
"The efficiencies that have been built into the terminal's grain handling operation continue to benefit our customers, and their continued support across our other business lines has allowed for excellent overall performance" said WIT President Claude Carles."While many companies charge different handling fees to farmers who have different crop qualities in different market areas, WIT has maintained our focus on providing high-value, low-cost services to all our farmer customers. We believe that the focus on farmers' needs that comes from being farmer owned and controlled will continue to pay off for both customers and shareholders, and we look forward to continuing to grow for the benefit of both."
Working capital at September 30 was $1.436 million compared to $0.816 million a year ago, and over $1.6 million in dividends have been paid to shareholders in 2010.WIT also paid out a total of $1.025 million in freight and dockage premiums to producers in the first nine months of 2010, and the company continues to file the lowest handling tariffs and be the only major grain handling company to offer net weight tariffs. This results in consistently lower costs to all farmers in the Weyburn market area for elevation, cleaning, and shipping of their grain.
"The wet spring reduced seeded acres significantly and summer rains resulted in additional acres being flooded out" said CEO Rob Davies."This impacted our crop inputs business, and certainly reduced the volume of grain harvested this fall."
Davies noted that between the carryout from last year's big crop and generally good yields in the crop that was seeded, WIT expects to maintain a steady, if somewhat smaller grain handling program over the next year. The ability of NorAmera to locally process some of the lower quality grains from this harvest has also been positive for local customers.
"WIT staff has and will continue to work closely with customers to provide delivery opportunity and create marketing, blending and drying programs where possible to improve the value of our farm customer's grains and oilseeds," added Davies.
There is optimism looking forward, noted Davies. "Although 2010 flooding may reduce grain handling volumes somewhat in 2011, crop price outlooks for next year are much improved over this time last year. Our experienced grain buying and marketing staff will continue to work with customers to create plans to maximize the value of their crop, we will continue to aggressively market flax and canola, and our professional agronomists will help customers maximizecrop production next year.NorAmera has taken major strides forward this year, and more consistent production there should help balance our income in 2011."
