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Financial Results Given at Annual Meeting
The annual meeting of Rocky Mountain Supply, Inc. (RMSI), was held in Twin Bridges on June 16, 2021. The cooperative reported very good results for its fiscal year ending Jan. 31, 2021.
FY2020 sales dollars of $83.3 million were down about $800,000 from the previous year, due to lower fuel and fertilizer prices stemming from the pandemic. However, RMSI set sales volume records in many key product areas, including fuel gallons, fertilizer tonnage, in-store sales and seed sales. If prices had remained at previous levels, sales may have hit $100 million.
On our FY2020 sales, we achieved a record $3.24 million in local net earnings. Our total net earnings before taxes stood at $7.46 million.
All three divisions — retail, energy, and agronomy exceeded their planned/budgeted results and previous year volumes. With no major projects impacting our operations at any location, this is likely as close to “hitting on all cylinders” as your co-op has ever been.
Other financial news
With the uncertainty of the COVID-19 pandemic, RMSI did participate in the Paycheck Protection Plan (PPP) offered by the U.S. Government. We needed to assure ourselves that we could protect jobs critical to serving our members. The PPP did have a positive impact on our earnings for FY2020.
Ten days before the end of our fiscal year, we received forgiveness of the entire amount we borrowed through the program. However, we had a very strong year, even without the benefit of the PPP.
With these strong results, RMSI’s board of directors plans to send about $1.6 million back to members in the form of cash patronage as well as equity retirements over the next year — in addition to any estate claims. We estimate cash patronage to be approximately $870,000 and equity retirements of about $750,000 will be paid out.
Please read the article provided by our CFO Terry Sweeney, on page 5. Terry is discussing a new form of equity we will implement this year as part of our patronage distribution. This “non-qualified” equity is not considered taxable at the time it is received by you, the patron.
Our goal, by using this type of equity, is to make our cash patronage distribution even more valuable to you. Because of the tax implications, you will be able to keep more of your cash patronage, instead of paying it to the government as part of your income tax.
Looking ahead
Thanks to everyone for your business and support over the past year. COVID-19 presented some unique challenges, but our employees showed their commitment to continue to serve our members and customers while dealing with the protocols required.
As you may know, we are building a new retail location in the Townsend area. This construction project will be done on an entirely new site, so it should not impact the present Townsend location.
This spring, our general contractor and subcontractors completed a considerable amount of site work in preparation for pre-engineered buildings that will serve as the store and warehouse. These buildings are scheduled to arrive the last half of July. The project is planned for completion by the end of calendar year 2021.