Record year for farmers’ cooperative
Monday 28th November 2011
AtlasFram Group, one of the UK’s leading farmer-owned cooperatives, has announced record results for the financial year to 30thJune 2011. The Group, which purchases farm inputs and markets combinable crops on behalf of its 1060 Members who farm more than 275,000 hectares throughout the UK, achieved a 20.8% increase in turnover to £168 million, while financial reserves rose to a record £2.5 million. At 1.03%, the cost-to-turnover ratio of the business was significantly lower that for comparative cooperatives, highlighting the high level of operating efficiency which it achieved and the value for money which it delivers to Members
AtlasFram’s business divisions all recorded volume increases due to Members purchasing more through the cooperative, as reflected in the fact that its Finance and Administration Department processed 186,190 invoices, 2.3% more than the previous year. Outstanding performances were achieved by the Livestock Supplies Department, which even in an extremely difficult year for livestock producers increased sales volume by 17%, while Framtrade Ltd, a wholly-owned retail subsidiary which supplies energy-related products such bulk/bottled LPG, fuel, electricity and stock items to the public and other farming groups, contributed a record profit of £203,000.
The first year of the Group’s formal alliance with ADM Direct, one of the world’s largest millers/oilseed rape crushers, also proved very successful, giving AtlasFram’s Grain Marketing Department a significant boost.
Announcing the results to AtlasFram Members at the Annual General Meeting in East Anglia, Serena Greenwell, the Group’s Chair, stated:
“During a year in which the turbulent state of the global economy was always in the headlines, the AtlasFram Group delivered a very sound financial performance, while our highly professional, well informed staff continued to provide Members with excellent prices and service. The rapid increases in the cost of farm inputs only serves to underline the exceptional value offered by our unique Hectarage funding scheme, which means that even if input prices rise the Group does not make extra profit from our Members but further rewards their commitment.
“AtlasFram operates a transparent financial structure, works to break-even budgets, has a back-to-back ordering system which eliminates transaction risks, while our significant financial reserves provide a highly-secure financial base that makes it very attractive for suppliers to do business with us and allow us to negotiate from a position of financial strength. They also provide continued access to credit facilities, enable us to provide individual Members with advance payments against the grain they commit to our marketing pools and benefit all Members through better interest rates than they can obtain from banks.
Richard Anscombe, Chief Executive Officer, added:
“I am very encouraged by the progress which we have made towards our vision and strategy of being the UK’s foremost farmer-owned purchasing and marketing cooperative, delivering the best service and information, supported by the best value and advice.
“The exceptional volatility which we have seen in both farm input and output prices highlight the value that Members receive from belonging to a highly-professional, financially-strong cooperative which operates entirely in their best interests. The success of this approach is reflected by a high, and increasing, commitment from existing Members across all key product areas, including arable products, machinery, livestock supplies, fuel, electricity, telecoms and building materials.
“During the last 12 months, 24 farming businesses from East Anglia, The South East, South West, Midlands and North West have joined AtlasFram and we have more than 40 applications pending. A key reason for our success is that rather than adopting a ‘one-size-fits-all’ approach we offer a tailor-made service which reflects Members’ individual requirements.
“Eighteen months ago, AtlasFram Group took a major step forward by establishing a unique marketing alliance with ADM Direct, the purchasing arm of Archer Daniels Midland (ADM), one of the world’s major millers and oilseed rape crushers. Members have already benefited from the best marketing information, new initiatives such as the Targeted Marketing Scheme and various variety-related premiums, while AtlasFram pools have provided protection against extreme price movements and significantly higher returns than many competitors. The fact that the number of Members utilising the AtlasFram Group’s Crop Marketing services has increased substantially has encouraged us to set ambitious growth targets for the year ahead.
“The UK is now just a small part of a truly global marketplace and our domestic agricultural sector is becoming less important to increasingly-large international suppliers and end-customers. To remain competitive, farmers will have to work together more closely through a strong, stable cooperative which purchases the inputs they require, achieves the best returns for their combinable crops and provides impartial advice to enable them to operate more profitably.
“A key strategic focus for AtlasFram Group is to further strengthen our relationships with key suppliers, to understand their business models and assess how working together will present greater opportunities to achieve efficiency savings that translate into cost savings for our Members. We have also invested considerable energy to further develop Saturn, the umbrella organisation which helps collaboratively-minded farmer cooperatives to work together and cooperate.
“We recognise that the independent agronomy sector is critical to our business and are increasing our efforts to work with the independent agronomists who advise our Members, agronomy groups and the AICC, together with those third-party stakeholder groups which matter to our Members. With the future in mind, we have also developed our Renewable Energy team to enable us to provide a broad range of in-depth information that will assist Members to review their options in this sector.
“Volatile times will create opportunities for both farmers and the Atlas Fram Group, which operates transparently and delivers maximum financial benefits back to its Members, an offer which we believe will be increasingly attractive to forward-thinking farmers. Our aim is to be recognised as the best purchasing and marketing cooperative for committed farmer Members who view us as an extension of their own businesses.”
“A good example of this is that we have just created a new wholly-owned subsidiary of the AtlasFram Group, Suffolk FWAG. This new company will employ the team of six that were previously employed by FWAG nationally to cover Suffolk and be fully operational within two weeks, providing continuity of the valuable service that FWAG have offered to 440 Suffolk farmers. A third of these are already members of AtlasFram, so the creation of the new company will be good news to them, and an opportunity to those who are not members of AtlasFram to become closer to us.
“Environmental and sustainability issues are becoming key elements for farming businesses. Climate change, commodity price volatility and significant changes in the global consumption of food are increasing in their strategic significance to our Members. Suffolk FWAG is an exciting opportunity for us to be at the forefront of member service in this respect.”
Further press information is available from:
Ashley Gilman or: Julian Cooksley
AtlasFram Group Kendalls Communications
Tel: 01728 727700 Tel: 01394 610022
Email: ashley.gilman@atlasfram.co.uk Email: julian.cooksley@kendallscom.co.uk
NOTES FOR EDITORS
1.
Further details about the AtlasFram Group are available at www.atlasfram.co.uk
2.
Digital images are available to illustrate this press release. Please contact Julian Cooksleyat Kendalls Communications - Tel: 01394 610022 or email julian.cooksley@kendallscom.co.uk
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