ARDEN HILLS, MINN. — For the full-year and fourth quarter, Land O’Lakes saw net income grow, despite dips in sales.
Net income for the full year ended Dec. 31 totaled $88,666,000. This compared with net income of $128,943,000 in 2005, which included a $69.7 million gain related to the company’s sale of its position in CF Industries, Inc. Disregarding this gain, net income grew 50% in 2006.
Net sales for the year were $1,934,947,000, down 3% from $2,001,275,000 in 2005.
The Feed segment reported pre-tax earnings of $36.7 million for the year, up slightly from 2005.
The company sustained a full-year $40.2-million pretax loss in its Layers/Eggs business, MoArk L.L.C. This compared with a pre-tax loss of $31.8 million in 2005. Results for 2005 included a pre-tax asset-sale gain of $7 million, while 2006 results included a $16.8 million impairment, partially offset by an $8 million asset sale gain. Without those one-time charges, operating results improved by approximately $8 million.
For the year, the Seed segment achieved a record $40.1 million in pre-tax earnings, well beyond the $29.4 million in pre-tax earnings registered in 2005.
Pre-tax earnings for the Agronomy segment for the year were $11.8 million. In 2005, Agronomy pre-tax earnings were $95.5 million, which included a $73.5 million pre-tax gain on the CF Industries sale.
For the fourth quarter ended Dec. 31, the company saw net income grow substantially, totaling $44,499,000. This compared with a loss of $1,638,000 in the fourth quarter of 2005.
Net sales for the quarter fell 4% to $7,274,913,000.
The Feed segment posted pre-tax earnings of $28.2 million in the fourth quarter of 2006, compared with $17.8 in the same period last year.
MoArk reported pre-tax earnings of $1.6 million, following a late-year improvement in egg prices. This compared with a pre-tax loss of $4.2 million for the same quarter last year.
The Seed segment had pre-tax earnings of $700,000 in the fourth quarter, compared with a pre-tax loss of $1.6 million in the year-ago period.
The Agronomy segment experienced a pre-tax loss of $16.3 million for the quarter, largely due to its 50% ownership in the Agriliance joint venture. In the fourth quarter of 2005 the Agronomy segment sustained a loss of $20 million.