In its second quarter financial release, CHS is attributing a year-over-year loss to poor weather conditions and continued global trade tensions.
Its fiscal quarter ended Feb. 28, and CHS Inc. reported net income of $125.4 million for the second quarter of 2020, which compares to net income of $248.8 million in the second quarter of fiscal year 2019.
“Today our top focus is on our core value of safety—including the health and safety of our employees, farmers, our owners, our customers, our local cooperatives and the communities where we live and work around the world—as we all navigate the impact of COVID-19,” Jay Debertin, president and CEO of CHS Inc said in the company’s release. “The investments we’ve made in our infrastructure connect farmers and local cooperatives to the inputs and services they need during this busy spring season. This crop needs to get planted. Farmers will get this crop planted. And we will be there to be part of it as we support them and our communities.”
For the ag and nitrogen segments of the company, here are second quarter 2020 results compared to second quarter 2019 with the company’s commentary:
Ag: A pretax loss of $20.8 million in second quarter of fiscal year 2020 compared to pretax loss of $62.4 million in the second quarter of fiscal year 2019 reflects:
• A strong wheat crop and improved weather conditions that contributed to improved results.
• Poor weather conditions in fiscal year 2019 and ongoing global trade tensions that continued to negatively impact volumes and margins within agricultural markets.
Nitrogen Production: Pretax earnings of $5.7 million in the second quarter of fiscal year 2020 compared to pretax earnings of $10.7 million in the second quarter of fiscal year 2019 reflect:
• Lower equity income from our investment in CF Nitrogen due to decreased market pricing of urea and urea ammonium nitrate, which are produced and sold by CF Nitrogen, of which CHS has partial ownership.
