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Mid-Year Financial Update
After verifying our operations for the first six months of 2022, I can tell you confidently that we’re having a good year. As of July 31, Rocky Mountain Supply (RMSI), has exceeded $100 million in sales. Last year’s sales topped $100 million in sales as well, but that was for the entire year. So, $102 million in sales for the first six months of 2022 is extraordinary. Over the same time period, local profits tracked slightly better than the previous year, so we’re positioned to finish 2022 well. Of course, fertilizer volumes are down--impacted by rising prices. We’ve sold 20-30% fewer tons than we did in the first half of 2021. Likewise, we’ve sold 5-8% fewer gallons of petroleum than the same period a year ago. Last year, we exceeded 30 million gallons in fuel sales, and we’re still poised sell over 30 million this year, but demand isn’t quite as strong. We’ve sold 10% more seed than previous years, and we’re very optimistic for strong fall seed sales. And in-store sales are up 7-8% from the first six months of last year. Gross margins in all categories are better this year than last. In 2021, volume carried the day. In 2022, volumes are good, but gross margins are up. Our profitability this year is also better than last. Actually, 2022 could be the best year for profitability that we’ve ever had.
Why we do what we do
After a rosy report like the one above, people ask me, “What’s next?” It does seem like we’ve always got a project in the hopper, so I wanted to talk about four strategic imperatives For sure, we don’t just come to work and say, “Let’s do this today!” These imperatives, and some examples of past projects addressing these imperatives, should give you insight into our decision-making process. Our goal is to be as transparent as possible with our members. Strategic imperatives are developed jointly by the Board of Directors and the Senior Leadership Team. Below are our current initiatives and examples of what we have done to support each imperative:
• Be the customers first choice by meeting current and future needs
Promotion and education about the importance and benefits of fall soil sampling – done through the agronomists’ “Weed Read” publication and the “Rocky Talk” newsletter.
Create a culture to provide the best talent to offer the best class service.
Participate in numerous compensation surveys to help ensure compensation levels are competitive to retain key employees.
• Evolving and diversifying RMSI’s agricultural presence.
Key acquisitions – Townsend Seed, Helena Fuel Supply, and Danhof Fuel. Implementation of the dual equity system, issuing non-qualified equity to ag producers and qualified equity to consumers and commercial/industrial accounts.
• Transforming RMSI’s technology platform to enhance the customer experience.
Implementation of the Epicor point-of-sale and inventory management system for the retail stores. Development and implementation of the QR code placed on customer bulk fuel tanks to make it easier for customers to order fuel through the RMSI website. RMSI’s board and leadership team evaluate our strategic imperatives every 3-4 years based on progress and other industry related changes and issues which may impact the direction of the company.