CHS Inc., the nation’s leading agribusiness cooperative, intends to return a total of $1 billion in cash patronage and equity redemptions to its owners in calendar year 2023, delivering on its objectives to share profits with owners and contribute to building strength in rural America.
CHS will return $180 million in cash patronage and equity redemptions to its owners based on fiscal 2019 earnings.
Of that $180 million, $90 million will be distributed in cash patronage and $90 million will be distributed through equity redemptions.
Of the $90 million in equity redemptions, $63 million will be returned to member cooperatives and $27 million to individual members.
The $27 million in redemptions of individual producer member equity will be provided based on qualifying requests from individual members (estates and age 70+).
As in previous years, 10 percent of fiscal 2019 patronage-based earnings will be designated to the company’s unallocated capital reserve, which is an important component of maintaining financial strength.
The CHS Board makes equity management decisions for the cooperative. The CHS Board also approved a policy change that states individual producer equity may be redeemed once every five years following any redemption that occurs upon reaching age 70.
All domestic production activities deduction (DPAD) will be used by CHS this year to offset the company’s tax liability.
CHS is committed to the success of cooperatives, farmers and ranchers today and into the future. Earning patronage and equity on the business conducted with a company owned by cooperatives, farmers and ranchers is a unique part of the cooperative business model.
The CHS Board made fiscal 2019 equity management decisions with these goals in mind:
Ensure decisions are in the best long-term interest of CHS and its owners
Maintain a strong balance sheet, including the capital reserve
Strengthen the company’s ability to pursue long-term growth
Patronage and equity are key benefits for owners of CHS and the cooperative system. CHS is committed to distributing patronage and redeeming equity for its owners while maintaining a strong balance sheet so it can continue to provide owners with the goods, services and supply chain capabilities required for long-term success.
Following the close of fiscal 2018, the CHS Board of Directors has announced the following patronage and equity distribution decisions: (more…)