Canada’s largest grain handling company has reported record financial results for the 2011 fiscal year and increased its annual dividend to shareholders by 50 percent to 15 cents per share per year.
Viterra president Mayo Schmidt said earnings before interest, taxes, depreciation, and amortization rose 36 percent to $702 million for the fiscal year that ended Oct 31, 2011.
Per share earnings rose 82 percent to 71 cents.
The company posted record returns despite fourth quarter net earnings of $9 million, down from $53 million in the fourth quarter of 2010.
Schmidt said fourth quarter results were affected by lower operating earnings, higher income taxes and non-recurring one-time costs, including those associated with asset disposal losses.
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Schmidt said profit margins from Canadian grain handling operations will continue to increase due to expanded market share, improved efficiencies at country elevator and port facilities and higher tariff rates for handling commercial grain.
Schmidt said the company’s assets in South Australia also continue to perform well due to increased volumes and grain handling efficiencies.
The company controls 95 percent of the grain handling capacity in South Australia and is expecting to handle as much as 6.8 million tonnes of the state’s estimated 7.9 million tonne crop in 2012.
Viterra is continuing to improve its position in key production regions including the Black Sea area.
In Western Canada, the recent acquisition of Imperial Oil’s rural fuel distribution network will strengthen the company’s position.
Viterra also sees an opportunity to increase fertilizer sales by adding new bulk distribution facilities in Western Canada, Schmidt said.
Despite sluggish fertilizer sales in the United States and Europe, Canadian fertilizer sales were brisk in the fourth quarter.
“Canadian farmers are still very bullish and are certainly looking to continue investing in their crops,” said Doug Wonnacott, chief operating officer of the agri-products segment.
The company will pay a semi-annual dividend of 7.5 cents per share next month. They will be paid Feb. 22 to shareholders of record on Jan. 30.
