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CHS Posts Fiscal 2010 Earnings of $502.2 Million

ST. PAUL, Minn., Nov. 12, 2010 /PRNewswire via COMTEX/ -- CHS Inc., a leading energy, grains and foods company, today reported fiscal 2010 net income of $502.2 million, the fourth-highest in the farmer-owned cooperative's nearly 80-year history.

The $502.2 million in net income from company operations reported for fiscal 2010 (Sept. 1, 2009 - Aug. 31, 2010) compared with $381.4 million for fiscal 2009. Revenues of $25.3 billion for fiscal 2010 were down 2 percent from the $25.7 billion generated in fiscal 2009 reflecting overall lower volatility in values for the grains and crop nutrient commodities that make up the majority of CHS sales.

For the fourth quarter of fiscal 2010 (June 1 - Aug. 31, 2010) CHS reported earnings from company operations of $154.1 million on revenues of $6.6 billion.

That compared with earnings of $97.3 million and revenues of $6.7 billion for the fourth quarter of fiscal 2009.

"Fiscal 2010 once again demonstrated the value of the diverse CHS business portfolio which allowed us to achieve strong financial performance amid a continued weak global economy," said John Johnson, CHS president and chief executive officer. "While some of our businesses faced market challenges in 2010, many others achieved record or near-record performance in 2010." As a producer-owned cooperative, CHS returns a portion of its earnings to eligible owners. In 2010, based on fiscal 2009 performance, the company issued $237 million in cash patronage, equity redemptions, preferred stock and dividends. Based on 2010 earnings, CHS is expected to return about $231 million to owners during fiscal 2011.

Performance was led by the company's Ag Business segment. The company's retail Country Operations unit posted record earnings, while grain marketing generated strong profits through its ability to manage through numerous global origination and demand challenges. Crop nutrients achieved a strong recovery in fiscal 2010 after posting significant losses the previous year precipitated by rapid global devaluation of product inventories.

Fiscal 2010 was a period of market fluctuations for the Energy segment. The year opened with record fall propane demand for crop drying, followed by a strong winter heating season. CHS lubricants and renewable fuels marketing businesses also captured market opportunity to generate record earnings. Petroleum refining margins fell dramatically for the first six months, as a continued weak economy depressed demand and crude oil inventories grew, but recovered in the third and fourth quarters, 2010, resulting in solid fiscal 2010 profitability for refined fuels, as well.

The CHS Processing segment includes its own oilseed crushing and refining operations, along with ownership in Horizon Milling, LLC and Ventura Foods, LLC.

Slightly improved demand and near-record volumes contributed to CHS Oilseed Processing performance. Vegetable oil-based food manufacturing joint venture Ventura Foods drew on strong customer relationships to achieve strong earnings during a continued downturn for the foodservice sector while the flour joint venture Horizon Milling combined increased demand with solid margins and risk management to achieve its second-best year. Overall earnings for the Processing segment were strong in fiscal 2010, with all businesses contributing solid performance.

CHS Business Solutions operations, recorded within the "Corporate and other" category, reported lower earnings for fiscal 2010, the result of an ongoing soft market for insurance services along with continued slow activity within the company's hedging and risk management and financing businesses, driven by reduced market volatility and continued record low interest rates.

CHS Inc. (www.chsinc.com) is a diversified energy, grains and foods company committed to providing the essential resources that enrich lives around the world. A Fortune 100 company, CHS is owned by farmers, ranchers and cooperatives, along with thousands of preferred stockholders across the United States. CHS supplies energy, crop nutrients, grain, livestock feed, food and food ingredients, along with business solutions including insurance, financial and risk management services. The company operates petroleum refineries/pipelines and manufactures, markets and distributes Cenex(R) brand refined fuels, lubricants, propane and renewable energy products. CHS is listed on the NASDAQ at CHSCP.

This document contains forward-looking statements within the meaning of The Private Securities Litigation Reform Act of 1995 that are based on management's current expectations and assumptions. These forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from the potential results discussed in the forward-looking statements. The company undertakes no obligations to publicly revise any forward-looking statements to reflect future events or circumstances. For a discussion of additional factors that may materially affect management's estimates and predictions, please view the CHS Inc. annual report filed on Form 10-K for the year ended Aug. 31, 2010, which can be found on the Securities and Exchange Commission web site (www.sec.gov) or on the CHS web site www.chsinc.com.

CHS Inc. Earnings By segment (in millions $) For the Three For the 12 Months Months Ended Ended August 31, August 31, 2010 2009 2010 2009 ---- ---- ---- ---- Energy $129.7 $67.2 $234.4 $418.7 Ag Business 12.9 16.4 269.3 73.7 Processing 27.1 33.3 74.7 4.1 Corporate and Other 1.4 2.0 5.4 7.2 Income before income taxes 171.1 118.9 583.8 503.7 Income taxes (3.9) (16.1) (48.4) (63.3) ---- ----- ----- ----- Net income 167.2 102.8 535.4 440.4 Net income attributable to noncontrolling interests (13.1) (5.5) (33.2) (59.0) ----- ---- ----- ----- Net income attributable to CHS Inc. $154.1 $97.3 $502.2 $381.4 ====== ===== ====== ====== SOURCE CHS Inc.

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