Rising to the Occasion – 92nd Annual Delegate Meeting
February 19, 2022
Written By Adam Buckallew
MFA Oil Declares $6.5 Million in Cash Distributions for Member-Owners
The Polar Vortex of 2021 plunged nearly every state in the country into a deep freeze with snow, ice storms and record-cold temperatures. The historic, prolonged Arctic blast created energy supply disruptions, the largest surge in propane demand in 17 years, and circumstances that required every propane terminal in the Midwest to ration supply to retail suppliers like MFA Oil Company.
These challenging conditions were among the many hurdles MFA Oil faced in its 2021 fiscal year. The cooperative contended with multiyear highs in fuel costs, a resurgence of COVID-19, supply chain issues, ongoing labor shortages, and more. Yet, the cooperative not only survived the tide of adversity—it thrived.
“We outperformed our expectations for the year thanks to our dedicated employees throughout the company,” said Jon Ihler, MFA Oil president and CEO. “Our employees care greatly for our customers and take pride in our services. I am incredibly proud of their efforts, which made 2021 another successful year for the cooperative.”
Ihler delivered the good news to the co-op’s delegates at the 92nd Annual MFA Oil Delegate Meeting on Dec. 13 in Columbia, Mo. Nearly 350 delegates, guests and employees attended the meeting. The company reported a pre-tax net income of $15.6 million for its 2021 fiscal year and announced it would pay $6.5 million in cash to its members in exchange for doing business with the company.
The announced distribution of cash to MFA Oil members includes a 100-percent payout of the company’s earnings for the 2020 fiscal year ($3 million in patronage) and the retirement of 50 percent of member equities from 2008 ($3.5 million). MFA Oil received an additional $2.7 million in patronage from other cooperatives that will be passed on to its members in the form of equity. Over the last five years, MFA Oil has paid out $36.3 million in cash to its members.
MFA Oil Chairman of the Board Glen Cope said the cooperative’s Board of Directors and management team share a simple philosophy regarding the company’s profits: “We keep what we must to sustain and grow our business and return the rest to you, our member-owners.”
MFA Oil members are eligible to receive 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, as well as 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.
“Doing business with MFA Oil means that you are investing in a company that will provide value to you and your communities,” Cope said. “Your board and senior management are committed to striking a balance between updating our company assets while returning profits in the form of patronage to our member-owners.”
In September 2020, the company launched MFA Oil Captive, a wholly owned subsidiary, to combat rising insurance costs. The captive insurance company allows MFA Oil to self-insure a portion of its insurance needs and provides financial income and tax savings benefits. Ihler said enhanced safety vigilance and more robust risk management policies helped reduce insurance claims in 2021.
The 2021 fiscal year included MFA Oil’s entry into the solar industry with the launch of Energized Solar, a wholly owned subsidiary of the farmer-owned cooperative. Energized Solar offers solar panel installations for farmers, homeowners and businesses.
The cooperative’s solar debut builds on MFA Oil’s reputation as a trusted energy provider and represents its latest commitment to diversifying its product offerings with renewable energy.
“We’ve met the energy needs of our members and customers for more than 90 years, and we see great opportunity in the fast-growing solar market,” Ihler said. “We’re excited to bring sustainable energy solutions to our farmers and the rural communities we serve.”
While the company is evolving and introducing new business lines within the cooperative, Ihler promised not to lose sight of the company’s historical role and purpose.
“We fully understand the important role we play in supplying energy to our members and that customers count on us to run their business,” Ihler said. “We’re working to maintain a big-picture, long-term view which accounts for the future needs of our member-owners.”
District Meetings Underway
Last March, the MFA Oil Company Board of Directors voted to amend the cooperative’s bylaws to allow delegate voting caucuses to move to the company’s Annual District Meetings, which began on Feb. 1 and are scheduled throughout the month.
The caucuses, held during the cooperative’s Annual Delegate Meeting in past years, are how delegates from each of the company’s eight voting districts elect their respective board members.
“Driving to the annual meeting can be a long trip for our delegates who live on the outskirts of our territories,” said Cope. “Moving the caucuses to the district meetings should allow more delegates to participate in the voting process since they won’t have to travel as far. The more people we can get involved with our cooperative, the stronger it becomes.”