WIT Announces 1st Half Peformance

The first half of Fiscal 2011 was profitable for Weyburn Inland Terminal Ltd.; however operations have been impacted by consecutive years of flooding in the Company’s core market area.  

WIT reported after-tax earnings of $904,000 ($0.17/share) for the January-to-June period — down from $3.566M ($0.67/share) in the same period in Fiscal 2010.  The Company had reduced earnings across all business operations primarily as a result of a 25% reduction in seeded acres in 2010 and 75% reduction in 2011.

“The efficiencies that have been built into the terminal’s grain handling operation over the years have benefitted our shareholders and customers, and given the Company a strong financial base to allow it to weather consecutive crop disasters” said Company President Claude Carles.  “The Board of Directors are all farmers, and understand that sometimes the weather can have a huge impact on an agricultural business.  That doesn’t change our focus on ensuring we are a strong participant in the farm economy in the future.  We believe that our local presence and the focus on farmers’ needs that comes from being farmer owned and controlled will continue to pay off for both customers and shareholders in the long term. We look forward to continuing to grow for the benefit of both.”  

Working capital at June 30 was $1.493M compared to $2.874M last year, and retained earnings increased slightly to $30.776M from $30.663M a year ago.  After an August semi-annual dividend declaration of $.05/share, dividends of over $1.350M will have been paid to shareholders this year.  The Company continues to ensure that the operating assets are state of the art, with $2.511M in capital expenditures to date in 2011.  WIT also paid out a total of $455,000 in freight and dockage premiums to producers in the first half of 2011, and the Company continues to file the lowest handling tariffs and be the only major grain handling company to offer net weight tariffs. This competitive pressure results in consistently lower costs to all farmers in the Weyburn market area for elevation, cleaning, and shipping of their grain.

“The wet spring reduced the harvestable acres by about 75% from intended” said CEO Rob Davies.  “This impacted our crop inputs business severely, and will limit the volume of grain harvested this fall.”  Davies noted that two consecutive years of flooding will result in a significantly reduced grain handling program over the next 12 months.  Looking at this fall, Davies added that “Our history of working with customers to improve their returns is well demonstrated, through drying, blending, and ergot cleaning programs we have offered in the past.  Our experienced grain buying and marketing staff will continue to work with customers to create plans to maximize the value of their crop, we will continue to aggressively market flax and canola, and our professional agronomists can help with crop management through harvest.

There are many opportunities for the next year, noted Davies.  “As we move towards a non-CWB monopoly marketing environment, WIT will spend significant time developing new plans and programs to allow us to continue to work closely with our customers after August 1, 2012.”     

WIT is a farmer-owned and farmer-directed grain company located on the CP Rail Soo Line near Weyburn, Saskatchewan. Since its beginning in 1976, ‘The Terminal’ has been at the forefront of change in the industry, leading the way to help improve the overall efficiency of Canada’s grain-handling system. The philosophy and goals of the company are summed up in its mission statement: Profitability Through Service, Innovation and Integrity.