Meeting Members’ Needs
February 26, 2024
Written By Adam Buckallew
MFA Oil Company had good tidings to share with its members this past holiday season. The company announced that members would receive a combined $19.9 million in cash and equity in exchange for doing business with the co-op.
The company announced the planned distribution at its 94th Annual Delegate Meeting on Dec. 11, 2023. Chief Financial Officer Jeff Raetz reported the cooperative realized a net income of $42.1 million for the fiscal year ending Aug. 31, 2023, compared to $14.3 million for fiscal year 2022. Approximately $22.9 million of 2023 net income came from regional patronage that MFA Oil received from other cooperatives. MFA Oil had a strong year, with companywide earnings of $19.9 million from its own operations.
“It was another great year for MFA Oil across all of our business units,” said Jon Ihler, president and CEO. “We credit the support, commitment, work ethic and passion of our employees with our success.”
Based on 2023 earnings, the company’s board of directors approved the retirement of 100% of 2009 member equities ($4 million), retirement of 2010 member equities ($2.2 million) and retirement of 50% of 2011 member equities ($1.7 million). The board also approved $8 million of qualified cash patronage, which represents two thirds of allocated qualified patronage for the 2023 fiscal year to be paid to members. Together, those figures equal $15.9 million in cash distributions. Additionally, MFA Oil will issue $4 million of member equities for 2023—bringing the total cash and equity distribution to $19.9 million.
Over the past five years, MFA Oil has returned $45.7 million in cash to members of the cooperative. Glen Cope, chairman of the MFA Oil Board of Directors, said the company’s strong results were “a collaborative effort shared between employees from every level of the company” and made possible by the co-op’s loyal member owners “who continue to see the value of doing business with MFA Oil year after year.”
“We take great pride in meeting the needs of our farmer-members who own the cooperative,” he said. “We reward their business with cash patronage and equity redemptions so that our member-owners can share in the co-op’s successes.”
MFA Oil members are eligible for patronage based on a percentage of the total money they spend on gasoline, diesel, propane, and lubricants purchased through the company’s refined fuel and propane plants and at Petro-Card 24 stations. Customers who are agricultural producers or owners of land used for farm production and purchase at least $1,000 of product from MFA Oil during its fiscal year (Sept. 1 through Aug. 31) are eligible for membership in the cooperative.
Cope told the more than 370 delegates who attended the meeting at the Holiday Inn Executive Center in Columbia, Mo., that the Board of Directors has three primary areas of focus: maintaining a strong balance sheet, growing the business and meeting the needs of member-owners.
“Effective growth and risk management are top of mind in the boardroom every time we meet,” Cope said. “This drives the board in our strategic thinking as we look to position the coop for long-term success and navigate volatile markets.”
In addition to receiving reports on the company’s financial standing and operational performance, delegates heard from guest speakers Missouri Lt. Gov. Mike Kehoe and farm broadcaster Max Armstrong.