Brian Zinchuk is editor and owner of Pipeline Online
FCL CEO Scott Banda. Screen capture
SASKATOON — Coming off a string of big-money announcements, Federated Co-operatives Limited (FCL) posted nearly $9.1 billion in revenue and $495 million in earnings for the financial year ending Oct. 31, 2021, up from $7.9 billion in revenue and $177 million in earnings in 2020.
From its earnings, FCL will return $353.5 million to local Co-ops across Western Canada, the organization said in a release on Dec. 16.
That’s after the recent announcement on Nov. 30 of the purchase of 181 Husky retail fuel sites from Cenovus Energy for $264 million. FCL also announced it bought land for a $1 billion renewable diesel complex to be built adjacent to the Regina Refinery. Additionally, on Oct. 21, FCL and Whitecap Resources signed a memorandum of understanding to implement carbon capture, utilization and storage at both the refinery and Belle Plaine Ethanol Complex. That is expected to cost in the range of $810 million.
Indeed, FCL has announced so many projects that it’s been inundated with requests from companies interested in working on them, to the point where on Dec. 15, they asked those suppliers and contractors to hold off for now.
Some money came to the balance sheet by way of a sale of its upstream oil producing assets and land in September.
“There’s been a lot of change and uncertainty impacting our work and our lives in the last year, including the pandemic, global supply chain issues and distressing weather conditions across the Prairies,” said FCL CEO Scott Banda. “It’s remarkable how the Co-operative Retailing System continues adapting to ever-evolving circumstances to remain steadfast supporters of Western Canadian communities that Co-op members can depend on.”
FCL said it experienced a record year for sales in its fertilizer, crop protection, seed, and home and building solutions business lines, with strong performances in food and energy. Inflation was a factor across all business lines and FCL said it benefitted from improved market conditions in the energy sector in the second half of the year, which bolstered earnings.
Throughout 2021, FCL continued to make investments across Western Canada, including expanding its fertilizer terminal in Brandon, Man., forming a joint venture with Blair’s Family of Companies and acquiring True North Renewable Fuels. FCL launched the new Western Nations brand for Indigenous-owned and operated gas bars, with the first location opening in Prince Albert, Sask., as a partnership between Lake Country Co-op and Sturgeon Lake First Nation.
FCL also announced its emission targets, committing to reduce greenhouse gas emissions by 40 per cent below 2015 levels by 2030, while also aspiring to achieve net-zero emissions by 2050. This will be achieved through major investments in the coming years, such as the aforementioned future implementation of carbon-capture technology at the Co-op Refinery Complex and Co-op Ethanol Complex.
“To be sustainable, we must continue to invest in our Co-op retail assets and in our future as a provider of transportation fuel in the low carbon economy,” said Banda. “Our profits are returned to our members and our investments in the future of our business will happen right here in Western Canada. That is something our entire Co-operative can be proud of.”
In the past five years, FCL said it has been able to return a total of more than $2.3 billion to local Co-ops across Western Canada. But that period was also marred with a six-month long lockout at the refinery, which started in December, 2019. It was finally resolved in June of 2020.
A complete account of FCL’s financial results will be released in March as part of its annual report.
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