United Farmers of Alberta (UFA) held its annual general meeting March 16 and, at it, approved a $12.5 million payment of patronage dividend to membership.
“We are turning a corner,” says Carol Kitchen, president and CEO, in a press release. “While we still have more work to do, the work that we have done is starting to pay off. We had a strong year reflected by customer and member satisfaction and our financial results. The co-operative now has the capacity to grow and invest in the business. All of our balance sheet metrics are the best they have been in over a decade.”
Kitchen says that the organization was driven to achieve a proftiability level that would allow it to pay a patronage dividend. It was unable to do that for 2015 or 2016.
“In 2017, UFA grew in nearly every segment of our core businesses,” says Kitchen. “This is a good news story for our business and a strong indicator that we are on the right path. The work is not done though and we will continue to look for efficiencies in our operations. The difference now is that we will also look for growth opportunities.”
Last year, UFA simplified its patronage dividend structure. In years where a dividend is declared, 40 percent is paid in cash, and 60 percent is issued as a member share equity. As of January 1, 2018, once $30,000 in member share equity is earned, 100 percent of the patronage dividends are paid in cash.
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Carol Kitchen, president and CEO of UFA, joined RealAgriculture’s Shaun Haney to talk about the recent announcement, and the company’s financials.
UFA restructured, simplified patronage dividend structure in 2017. if dividend declared, 40 percent paid in cash, 60 percent issued as member share equity
“Once you earn $30,000 in member share equity, 100 per cent of patronage dividends will be paid in cash,” explained Kevin Hoppins, UFA Chairman of the Board. UFA enacted this new structure on January 1, 2018.
“We are committed as a co-operative to creating value for our members,” says Kevin Hoppins, chair of the UFA board. “This new structure is easier for our members to understand, provides them with greater value, and returns more cash to those who have contributed to our success. We wouldn’t be declaring a patronage dividend without our members’ support.”
UFA has seen big changes in recent years, hiring Kitchen in 2015, and closing its Wholesale Sports Canada business two years later.
The co-operative has more than 110,000 member-owners, with 50,000 considered “active members.