Letter from the CEO
May 01, 2024
With 2023 completed, I want to reflect on the tremendous momentum we have experienced this year. Our employees and facilities functioned at a very high level, creating growth, and timely service. I want to thank the employees for their commitment and dedication and our member/owners for your loyalty and trust. Each of our core divisions saw unit increases and captured efficiencies to provide a good return on investment. The United Cooperative board has approved many building projects this year to meet the demands of our customers. The communities where major construction projects were completed and are in construction phases include Waupun, Mayville, Ripon, Wilton, Center Valley, Boscobel, South Beaver Dam, Deerfield, and Coleman.
We were blessed with another great crop year even though moisture levels were a great concern for most of the growing season. Our planting season seems to get more condensed each year. The facility upgrades we continue to make really help us to move a lot of products in a short period. On another positive note, we were able to find the help and the logistics to get this accomplished. Thank you to our seasonal employees and our suppliers for this achievement. The harvest season was like last years, with great weather and harvesting conditions. Overall, we enjoyed favorable yields and excellent fall tillage conditions. We also had a considerable amount of fall fertilizer application this year. This should take some of the pressure off our spring planting season. We received record volumes of corn and near record volumes of soybeans last harvest season. We continue to add grain storage capacity to meet the demands of our member owners. Grain production continues to increase in Wisconsin, and we will always evaluate our infrastructure to ensure that we can provide the best possible service available. To our grain customers, thank you for your confidence in United Cooperative this past harvest season.
December 31st marked the end of our fiscal year and the privilege of being in business for 88 years and United Cooperative had another strong year. Planning, execution, product availability, customer service, and loyal members are the foundation for United Cooperatives’ success.
Our vision for the future has to parallel the agricultural changes of our farmers to create a positive customer experience where our farmers can “Rely On Us”. This is evident today based on the economic environment, supply chain issues, inflation, and worldwide markets. To maintain this type of experience, please discuss your needs with your trusted advisors at United Cooperative. Decision-making, forecasting, planning, and execution all have a direct impact on profitability at the farm and the cooperative.
United Cooperative takes pride in giving back to our local communities and helps advance many non-profit organization’s initiatives throughout the year. The cooperative’s approach is to target community giving to three areas that support members the most: rural health and safety; agricultural youth; and food pantries. This year our total giving to initiatives in these three areas reached over $100,000. In 2023, 46 high school and college students were awarded a $1,000 United Cooperative scholarship, bringing the total number of students supported through this program to over 550 since the program’s inception in 2008.
Revenues for 2023¬ were $1.36 billion. United Cooperative’s core businesses of agronomy, grain, feed, and energy generated $75.5 million in profits. The investments United Cooperative has made in ethanol production contributed $37.2 million to our net income in 2023. Patronage from regional cooperatives was $11.3 million dollars. All combined, United Cooperative had a total net margin before income taxes in 2023 of $124 million dollars.
With those numbers, United Cooperative is returning $67.8 million in total patronage to members. Fifty percent of this patronage, or $33.9 million, will be distributed in cash to our patron members in May, while the other 50 percent, or $33.9 million will be retained in equity credits. In addition, we plan to again revolve stock in October, retire stock at age 77 and pay all estates as requested.
We strive to uphold United Cooperative’s promise to build on all available resources to create positive customer experiences while growing profits for members and the cooperative. We want members to “Rely on Us” for high-quality reliable products and exceptional service, all backed by up-to-date, efficient equipment and facilities.
Thank you again for your patronage in 2023 and I look forward to an exciting and prosperous year in 2024.