-John Knobloch, General Manager
While 2017 was one of the more difficult years for the agriculture sector in recent history, we are proud of how well the company performed across multiple fronts. Our strategy is structured around four strategic pillars: bringing value to the customer, focused growth, expanding relationships and personal development.
We deliver value to our customers by focusing our marketing on four areas. Reducing customer risk, increasing customer revenue, making the customer more competitive and making life easier.
The addition of four new FAST STOP® Express retail fuel sites will give us continued growth in energy. Audubon and Creston opened in June 2017 and Albia and Winterset opened in October 2017. All four new sites are on state highways and are attractive, 24-hour unattended fuel sites. New sites include on-road and off-road diesel, along with ethanol blender pumps to promote E-15, E-30 and E-85. The four new liquid fuel routes started from scratch in the past couple years continue to show growth and will begin contributing to net income in the 2018 fiscal year. Overall, fuel volume in the 2017 fiscal year increased eight percent (8%).
Our feed mill investment at Oskaloosa to improve efficiencies helped pave the road for the company to achieve record levels of gross and service. We are projecting a 25% increase in gross revenues during the 2018 fiscal year.
Agronomy increased dry plant food and crop protection by over eight percent (8%). Growth continued in 2017 for our turf department. We are preparing for future geographical growth in the turf products later in 2018. Investments are being made in 2018 fiscal year to upgrade agronomy facilities at Hedrick, Logan and Underwood.
On December 11, 2017 the boards of directors of Clarinda Co-op Co. (Clarinda, IA) and AGRILAND FS, Inc. (Winterset, IA) voted unanimously to merge the two cooperatives. Upon shareholder approval, Clarinda Co-op will merge into AGRILAND FS, effective February 1, 2018. Clarinda Co-op, Class A members will vote on the merger into AGRILAND FS. As a part of the merger agreement, two directors of the Clarinda Co-op board will join the AGRILAND FS board of directors.
AGRILAND FS performs best for our customers when we expand our business relationships across multiple product categories. This develops a stronger and deeper relationship with our customers that improves customer satisfaction and brings enhanced business efficiencies for your cooperative. Marketing programs and employee focus on growing within the customer base is a cross-selling strategy, and we have already shown success in 2017 with our crop protection and lubricant growth.
AGRILAND FS has more than doubled down on the development of our employee team! We believe our investment in skill development programs are seeds that will pay dividends in personal career growth and the future financial success of AGRILAND FS. Our AGRILAND FS culture is one of excellence. We take pride in training and developing ordinary people to become extraordinary!—it's the AGRILAND FS way.
In August 2017, the Board of Directors authorized AGRILAND FS to pay patronage at 80% cash and 20% stock. As we approach the 2018 calendar year, we are all focused on delivering progress on several long-term business objectives. AGRILAND FS is strong financially, and we look forward to striving for outperformance in the future.
In closing, we want to express our gratitude to the customers and cooperative members of AGRILAND FS for their ongoing support with your purchases of products and services.
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