Full 2020 Annual Report

More united than ever. 2020 Annual Report Mission Rooted in our regions and leveraging our collective strengths, we nourish people by ensuring the prosperity of farming families to ensure a sustainable future for our world. Vision To be recognized as a leader of reference in our Canadian retail markets, in the North American agricultural market and in the International agri-food industry. Values Honesty Equity Responsibility Solidarity Each of us acts with Each of us, like each Each of us fully assumes Driven by a desire for the utmost transparency, working group, treats our role within Sollio mutual aid, we consult both within our company our partners fairly and Cooperative Group, in and advise one another and in our relations with equitably. We believe that particular by ensuring the to achieve our common member cooperatives and everyone deserves to find sound management of our goals. We work hand other stakeholders. We all their place within our large members’ collective assets, in hand, in an open, admit our mistakes freely, cooperative network, to by ensuring they fulfill their consistent, methodical give credit where due be recognized there and individual, mutual and manner and rally around and seek to avoid conflicts to flourish. collective commitments, decisions made for of interest. remaining fully accountable the common good of for their actions, and by our company. embracing the goal of sustainable development. What will tomorrow be made of? Of hearts at work and moments shared together. Of fields of expertise and fertile fields. Of projects that bear fruit and flourishing regions. Of healthy citizens and an enriching world. Tomorrow will be made of us. We, the producers, transformers, distributors, associated companies and employees. We, the people on the ground, thinking of tomorrow. We, with our feet planted firmly in the present and our eyes focussed resolutely on the future, are more committed, more passionate, more dedicated and more resilient than ever. Driven by the same values. Steadfastly determined to preserve the Canadian food resources served on tables every day. We, united under one business model, come together to speak with one voice and dream of the same future. A promising, sustainable, collective future. A caring, optimistic, prosperous future. Where cooperation, innovation and shared expertise will continue to cultivate our collective strengths. At Sollio Cooperative Group, we’re proud to be active participants in the economic development of our land, our country. An agent of effective, local change and a leading corporate citizen, we produce here, transform here and harvest here to ensure a future that will inspire the generations that follow. Ahead of our 100th Anniversary, we’re making every effort to leave our children a rich, lasting food legacy that they, in turn, will nurture. To bring these aspirations to life, we must remain true to our vision, agile and above all else… more united than ever. Table of contents Highlights 4 President's message 7 Management discussion and analysis 13 Sollio Agriculture 19 Olymel 23 BMR Group 27 Financial position 31 Risks and uncertainties 33 Our cooperative heritage 35 Management's report 46 Independent auditor's report 47 Consolidated balance sheet 49 Consolidated statement of earnings 50 Consolidated statement of reserve 50 Consolidated statement of cash flows 51 Notes to consolidated financial statements 52 Financial review 78 Affiliated cooperatives 82 Auxiliary members 83 2020 Annual Report Sollio Cooperative Group 3 Highlights Revenues 2020 $8,152,114 2019 $7,282,058 (in thousands of dollars) 2018 $6,515,972 2017 $6,271,772 2016 $6,335,219 Earnings before patronage 2020 $201,037 2019 $79,353 refunds and income taxes 2018 $210,725 (in thousands of dollars) 2017 $351,228 2016 $275,438 Dividends paid to the 2020 $ 7,700 2019 $2,400 Cooperative Pork Chain 2018 $11,200 (in thousands of dollars) 2017 $15,800 2016 $10,800 Patronage refunds 2020 $29,200 2019 $17,6 0 0 (in thousands of dollars) 2018 $42,400 2017 $88,000 2016 $55,000 Working capital 2020 $661,293 2019 $404,261 (in thousands of dollars) 2018 $553,559 2017 $414,274 2016 $415,280 Preferred shares and 2020 $2,032,586 2019 $1,780,586 Sollio's Group equity 2018 $1,480,827 (in thousands of dollars) 2017 $1,285,250 2016 $961,809 4 Annual Report 2020 Sollio Cooperative Group [IN THOUSANDS OF DOLLARS] 2020 2019 $ $ Revenues 8,152,114 7,282,058 Operating earnings 178,792 48,085 Earnings before patronage 201,037 79,353 refunds and income taxes Patronage refunds 29,200 17,6 0 0 Net earnings 140,987 48,604 Accounts receivable and inventories 1,594,679 1,414,439 Current assets 1,770,159 1,545,083 Working capital 661,293 404,261 Property, plant and equipment, 2,702,183 2,220,841 at cost Property, plant and equipment, 1,567,259 1,215,381 net carrying amount Total assets 4,728,182 3,880,159 Long term debt and obligations 1,270,098 845,774 under capital leases including current portion Preferred shares and 2,032,586 1,780,586 Sollio's Group equity Number of employees 16,150 15,360 Annual Report 2020 Sollio Cooperative Group 5 More commited than ever. Ferme M & A Scoble Finalist New Farm Enterprise and Farm Succession Award 2020-2021 President's message — Ghislain Gervais Sollio Cooperative Group’s past fiscal year was marked by exceptional turmoil resulting from the COVID-19 pandemic. Despite these difficult conditions, Sollio Cooperative Group once again showed that its cooperative identity is an asset to overcome obstacles and to continue positioning itself favourably for the future. In 2020, Sollio Cooperative Group The CN strike coincided with peak This strong commitment and mobiliza- completed its ambitious growth strategy demand for propane, not to mention tion effort reflects the values that drive of the past few years and launched a new a railway blockade some months later. our network and which more than ever cycle for the next five years. Our new COVID-19 led to major changes in take on their full meaning: responsibility, 2025 Strategic Plan is well rooted in our operations, plant closures, shutdown solidarity, equity and honesty. of construction sites, and disruptions of ambition, namely to ensure prosperity All these efforts also enabled us to com- supply chains and markets. The Port of for our farming families and help our plete our ambitious growth plan. members feed the world. Montréal strike caused many logistical challenges. Lastly, organizations across The integration of F. Ménard operations The Vision 2020 network project is well the world were hit by an unprecedented went smoothly. This acquisition enabled underway and continues to advance. wave of hacking. Olymel to maintain its position as one of This year again, the network spared no the largest pork processing companies effort, amid the pandemic, to pursue The past year also brought some in North America. Olymel also made cooperative consolidation and forge tailwinds. The hardware sector greatly a significant investment to expand its new partnerships. benefited from the enthusiasm for Saint-Damase poultry processing plant, renovations sparked by the lockdown. Sollio Cooperative Group’s financial allowing for the diversification of opera- Export markets for pork were robust, results demonstrate the resiliency of our tions and activities, and the addition of particularly the Chinese market. teams and our network as well as our new state-of-the-art facilities. cooperative business model. Conso- Above all, the severe strain on supply Sollio Agriculture completed construction lidated sales exceeded $8 billion with chains highlighted the importance of work on the grain terminal at the Port of earnings before patronage refunds and encouraging buying local and increasing income taxes reaching $201 million. Québec City, providing agricultural pro- food self-sufficiency while developing ducers access to the international grain Note that we had to face one headwind exports. export market. after another during the past fiscal year. Amid the pandemic, we worked relent- Lastly, the recent partnerships with The harvest season was difficult across lessly to keep supporting producers BMR Group in growing market segments Eastern Canada. in their vital operations and serve our are generating the expected results. clients. We successfully adapted our operations for the benefit of local consumers and foreign markets. 2020 Annual Report Sollio Cooperative Group 7 PRESIDENT'S MESSAGE — GHISLAIN GERVAIS Solidarity is the very foundation of our network and all our actions. By considering both the needs and the contribution of each individual, solidarity strengthens value chains. Our growth would not have been The various hardships we endured this The creation of a partnership in grain possible without the support of finan- year have clearly demonstrated network marketing, namely Sollio & Grains cial institutions. This year again, our solidarity, among other things, through Québec Agriculture coopérative, will financial partners provided backing for its commitment to the community. The make it possible to offer better marke- us by investing in preferred shares and launch of the From Us to You initiative ting conditions to producers and better renewing our credit facility. along with 17 network cooperatives is meet processors’ needs. Discussions are one example. underway with Uniag Coopérative for We would like to thank our financial setting up partnerships tailored to their partners for their strong vote of confi- Under this initiative, food was donated regional conditions. dence in our organization and the and financial support was provided cooperative business model. to organizations that help people in This impetus towards solidarity was also observed across the bio-food sector. On behalf of the Board of Directors, need throughout Québec and eastern Together, organizations in the value I extend my thanks to Gaétan Desroches, Ontario.

Load more