Federated Co-operatives Ltd. has reported yet another record financial result.
The organization has reported retained savings of $988.9 million at the end of 2006, on gross sales of $5.39 billion, both of them records.
That compares with 2005 year-end savings of $784.7 million on gross sales of $4.8 billion.
“2006 was an outstanding year,” chief executive officer Wayne Thompson told delegates attending FCL’s annual meeting in Saskatoon last week.
Petroleum was the biggest source of wholesale revenue, with sales of $2.7 billion and retained savings of $341.5 million from Consumers Co-operatives Refineries Ltd.
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FCL’s investment in New Grade Energy Inc., a heavy oil upgrader that is integrated into the CCRL complex in Regina, had sales of $418 million and net savings of $104.6 million.
Most of the gasoline sold in Saskatchewan and Manitoba comes from the CCRL plant.
FCL president Glenn Tully acknowledged that retained savings of close to $1 billion may seem excessive, but said the organization has been accumulating money with an eye to future expansion of the co-op, notably at the refinery.
“We’ve been pretty vigilant at putting some money away every year to finance expansion,” he said, adding the organization expects to invest another $1 billion of new capital into the refinery over the next five years to boost capacity beyond the current output of 100,000 barrels per day to meet growing demand.
“We think it’s very important and prudent that we make sure the cash flow is there to fund that requirement,” Tully said in an interview.
Food sales was the next biggest revenue generator in 2006 after petroleum, with gross sales of $1.59 billion and retained savings of $71.3 million.
That was followed by crop supplies, with savings of $15.9 million, general merchandise at $12.9 million, forest products at $3.5 million and livestock feed at $2.4 million.
