GARDEN CITY CO-OP 96 TH ANNUAL STOCKHOLDERS MEETING DECEMBER 2 ND 2015 GARDEN CITY, KANSAS

Transcription

1 GARDEN CITY CO-OP 96 TH ANNUAL STOCKHOLDERS MEETING DECEMBER 2 ND 2015 GARDEN CITY, KANSAS

2 GARDEN CITY CO-OP, INC. 96 th ANNUAL MEETING AGENDA Call to Order Tom Mulville Invocation Tom Mulville Welcome Tim Miller Declaration of Quorum Bruce Howard Proof of Notice Bruce Howard Approval of Minutes Bruce Howard Introduction of Guest and Past Board Members John McClelland Audit Report Brent Merz Chairman Report Tom Mulville General Manager Report John McClelland New Business Tom Mulville Nominating Committee Report Boyd Lear Candidate Speeches Election of Directors Tom Mulville Employee & Retiree Recognition John McClelland Question & Answer Session Door Prizes Tyler Hands Adjournment

3 November 19, 2015 OFFICIAL NOTICE OF THE ANNUAL COMMON STOCKHOLDERS MEETING NOTICE IS HEREBY GIVEN, that the Annual Meeting of the Common Stockholders of The Garden City Co-op, Inc. will be held Wednesday, December 2 nd, at 2 o clock p.m. at the Clarion Inn Convention Center, at 1911 E. Kansas Ave., Garden City, Kansas. Registration will begin at 1:30 p.m. The purpose of the Annual Meeting will be to receive reports of officers and management including a review of audited financial statements, elect directors, and such other matters as may properly come before the membership. There are 2 positions open. Tyler Hands, Gordon Drees and any candidates nominated from the floor, will be running for these 2 open Director positions. This is an important meeting, and the board of directors encourages your attendance and participation. We look forward to celebrating, and in doing so, we will hold a drawing for 5 awards of early redemption up to $1,000 in Co-op stock, as well as other door prizes. Refreshments will be served. Sincerely, Bruce Howard Secretary/Treasurer

4 GARDEN CITY CO-OP, INC. Garden City, Kansas CONSOLIDATED BALANCE SHEETS August 31, 2015 and 2014 ASSETS CURRENT ASSETS Cash $ 465, $ 791, Investment securities available-for-sale $ - $ 1,002, Accounts and notes receivable - trade $ 4,577, $ 4,187, Allowance for bad debts $ (50,000.00) $ (50,000.00) Grains receivable - trade $ 17,950, $ 16,490, Grain storage receivable $ 1,629, $ 1,121, Other receivables $ 2,923, $ 9,655, Inventories $ 30,863, $ 32,230, Prepaid commodities and expenses $ 4,641, $ 6,160, Deferred tax asset $ 40, $ 99, TOTAL CURRENT ASSETS $ 63,040, $ 71,689, INVESTMENTS AND OTHER ASSETS Corporate stock and equity $ 46,086, $ 42,969, Limited liability companies $ 2,295, $ 2,292, Cash surrender value of life insurance $ 241, $ 237, Notes receivable $ 117, $ 178, Other assets $ 11, $ 17, TOTAL INVESTMENTS $ 48,752, $ 45,694,746.99

5 PROPERTY, PLANT, AND EQUIPMENT Cost $ 91,133, $ 88,187, Accumulated Depreciation $ (43,535,976.40) $ (41,626,571.28) NET PROPERTY, PLANT, AND EQUIPMENT $ 47,597, $ 46,560, TOTAL ASSETS $ 159,390, $ 163,944, LIABILITIES AND MEMBERS EQUITY CURRENT LIABILITIES Accounts, expenses, and taxes payable $ 6,667, $ 12,290, Grains payable $ 5,479, $ 8,233, Collections received in advance $ 69, $ 134, Current maturities of notes payable $ 33,854, $ 29,223, Current maturities of capital lease obligations $ 1,245, $ 1,089, Current maturities of patron notes payable $ 5,600, $ 5,600, Patronage dividends payable $ 367, $ 1,143, Equity retirements payable $ - $ 1,000, Income taxes payable $ 197, $ 9, TOTAL CURRENT LIABILITIES $ 53,481, $ 58,725, LONG-TERM LIABILITIES, excluding current maturities Notes payable $ 17,720, $ 17,090, Capital lease obligations $ 3,880, $ 4,905, Grain contracts payable $ 789, $ 759, Deferred income taxes $ 622, $ 714,593.22

6 TOTAL LONG-TERM LIABILITIES $ 23,012, $ 23,469, MEMBERS EQUITY Common stock $ 29,905, $ 29,210, Participating stock $ 7,210, $ 6,381, Patronage dividends $ 856, $ 2,669, Equity retirement payments $ - $ (1,000,000.00) Retained savings $ 44,923, $ 44,501, Accumulated other comprehensive income $ - $ (12,687.30) TOTAL MEMBERS EQUITY $ 82,895, $ 81,750, TOTAL LIABILITIES AND MEMBERS EQUITY $ 159,390, $ 163,944,729.73

7 7 GARDEN CITY CO-OP, INC. Garden City, Kansas CONSOLIDATED STATEMENT OF OPERATIONS for Years Ended August 31, 2015 and SALES Grain $ 96,010, $ 85,971, Supply $ 29,788, $ 26,115, Commercial & Wholesale $ 64,638, $ 130,590, TOTAL SALES $ 190,438, $ 242,677, TOTAL COST OF SALES $ 171,146, $ 227,558, GROSS MARGINS ON SALES $ 19,291, $ 15,119, OTHER INCOME Storage and handling $ 1,536, $ 2,226, Drying income $ 397, $ 360, Service income $ 882, $ 675, Freight income $ 3,228, $ 2,865, Gain on disposal of property, plant and equipment $ 27, $ 182, Interest income and finance charges $ 52, $ 37, Patronage dividends $ 4,476, $ 6,810, Investment income and dividends on stock $ 768, $ 6,836, Miscellaneous $ 219, $ 112, TOTAL OTHER INCOME $ 11,588, $ 20,106, GROSS SAVINGS $ 30,880, $ 35,225, EXPENSES

8 8 Personnel costs $ 12,814, $ 11,290, Fixed expenses $ 9,217, $ 7,871, Other operating expenses $ 6,869, $ 5,902, TOTAL EXPENSES $ 28,902, $ 25,064, SAVINGS BEFORE INCOME TAXES $ 1,977, $ 10,161, INCOME TAX BENEFIT (EXPENSE) $ (333,127.50) $ 441, NET SAVINGS $ 1,644, $ 10,602, DISTRIBUTION OF NET SAVINGS Patronage dividends $ 1,223, $ 3,812, Retained earnings $ 421, $ 6,790, TOTAL $ 1,644, $ 10,602,916.01

9 CONSOLIDATED STATEMENT OF OPERATIONS (NON-GAAP) for Years Ended August 31, 2015 and SALES Grain $ 96,010, $ 85,971, Supply $ 29,788, $ 26,115, Commercial & Wholesale $ 64,638, $ 130,590, TOTAL SALES $ 190,438, $ 242,677, TOTAL COST OF SALES $ 171,146, $ 227,558, GROSS MARGINS ON SALES $ 19,291, $ 15,119, OTHER INCOME Storage and handling $ 1,536, $ 2,226, Drying income $ 397, $ 360, Service income $ 882, $ 675, Freight income $ 3,228, $ 2,865, Gain on disposal of property, plant and equipment $ 27, $ 182, Interest income and finance charges $ 52, $ 37, Cash patronage dividends $ 392, $ 243, Cash investment income and dividends on stock $ 706, $ 6,838, Miscellaneous $ 217, $ 409, TOTAL OTHER INCOME $ 7,440, $ 13,837, GROSS SAVINGS $ 26,732, $ 28,956, EXPENSES Personnel costs $ 12,814, $ 11,290, Fixed expenses $ 4,938, $ 4,585,

10 10 Other operating expenses $ 6,869, $ 5,902, TOTAL EXPENSES $ 24,623, $ 21,777, SAVINGS BEFORE INCOME TAXES $ 2,108, $ 7,178, INCOME TAX BENEFIT (EXPENSE) $ (333,127.50) $ 441, NET CASH SAVING $ 1,775, $ 7,620, OTHER SAVINGS/EXPENSE Deferred patronage dividends $ 4,084, $ 6,567, Deferred investment income $ 63, $ - Depreciation expense $ (4,278,686.82) $ (3,584,139.33) TOTAL OTHER SAVINGS/EXPENSE $ (130,779.09) $ 2,982, TOTAL NET SAVINGS $ 1,644, $ 10,602, DISTRIBUTION OF NET SAVINGS Patronage dividends $ 1,223, $ 3,812, Retained earnings $ 421, $ 6,790, TOTAL $ 1,644, $ 10,602,916.01

11 11 UNAPPROVED Garden City Co-op, Inc Annual Stockholders Meeting December 3, 2014 The Annual Meeting of the Stockholders of the Garden City Co-op, Inc. met Wednesday, December 3, 2014, at the Clarion Inn, 1911 E Kansas Ave, Garden City, Kansas. At 2:00 p.m., Tom Mulville, Board Chairman, called the meeting to order. Directors in attendance were Tyler Hands, Bill Maughlin, Michael Deaver, Tim Miller, Bruce Howard, Lynn Teeter and Associate Directors Matt Horton, Nate Bingaman and Chris Fullmer. Tim Miller welcomed members and guests and expressed the Board of Directors appreciation at the level of attendance and commitment from so many to the Garden City Co-op. Bruce Howard advised that there were 211 voting members present, thus making a quorum. Bruce further advised that on November 19, 2014, 1,444 notices were mailed and it was certified by the U.S. Post Office. Bruce asked for any corrections to the minutes. With no corrections, minutes were approved as provided. John McClelland recognized special guests: Bob Temple and Dave Cornett with WindRiver Grain; Gerald Miller with Commerce Bank; Greg Johnston and Rick Gudding with KFSA, Kendall Poland with Sublette Coop, Gary Friesen with Scott Coop; Stacy McVey with Plains Equity; Kelly Kroz with CoBank, Nick Mueting with Lindburg, Vogel, Pierce, Faris, Rocky Bell with CHS, Sean Thayer and Grant Elpers with Wells Fargo Advisors. John also recognized all past board members by asking them to stand, as well as Harley Foulks as past General Manager and all Vice Presidents. Brent Merz, CFO, reviewed the financial information that was distributed in the Annual Report: Sales $242,677,377.76; Gross Margins $15,119,035.37; Gross Income from Local Operations $35,225,714.86; Total Assets $163,944,729.73; Total Current Liability $58,725,173.88; Total Long Term Liabilities $23,469,266.75; Total Members Equity $81,750, Retained Savings are at $6,790, and Total Patronage Dividends are at $3,812, Brent further reported the patronage rates that are to be returned for Nick Mueting of Lindburg Vogel Pierce Faris stated that he had submitted an unmodified or clean opinion on the August 31, 2014 financial statements. There were no questions or comments regarding the financial report. Tom Mulville then introduced the current Board of Directors. During the year, there were a total of 10 regular and 1 special, with 4 associate director absences. He advised there was attendance at the CoBank, Texas Co-op Council and KFSA meetings, participation in KCC training, as well as several neighboring cooperative annual meetings.

12 12 Tom emphasized the fact that as we move forward and look at the structure of the Co-op, we have become aware of both an aging employee group and aging facilities. Over the next year the Board s commitment is to continue to look at future needs and adjust accordingly. Tom further talked about the activities that the Board where involved in over the last year and their interaction with the employee group and other co-op members and members from other areas. Tom thanked the employee group and the membership for continuing to support their strong and growing cooperative. John McClelland, General Manager, talked about where we are as a company and how far we have come over the last year. The continued investment in facilities has vastly expanded storage capacity for grain, petroleum products and ag inputs. The continued growth of infrastructure has allowed for possibilities within the company. Trucking and technology has changed extensively in support of substantial growth. The addition of precision farming is an exciting and new aspect of the Garden City Co-op in support of new and changing demands. John stressed the fact that the company will continue to answer membership needs. John then announced the rollout of the Otis and Mary Lee Molz Cooperative Scholarship at the Garden City Community College. In addition, CoBank announced that they were also contributing $10,000 to the scholarship fund. The Garden City Co-op will also contribute $15,000 per year to cover the interest on the initial $500,000 to be able to maintain the fund. Tom asked for new business. There was no new business. There was no old business. Tim Miller then introduced Boyd Lear to provide the nominating committee report. Tom Mulville, Bruce Howard and Bill Maughlin were introduced for the three Director positions. There were no nominations from the floor. There was a unanimous ballet cast for the three nominations. John and Tom recognized Alberto Barron for 25 years, Toby Wilson for 20 years, George Pittman, Jeremy Kells, Mike Mings and Holly Cowan for 15 years, Henry Miller and Shelly Mann for 10 years and Abe Hamm, John Griffin, Brandon Ochs, Kevin Redger, Ronald Woods, Omaro Quinonez, Pedro Hernandez, Scott Heydinger, Victor Duarte, Tavo Gomez, Isaac Gonzalez and Nathan Gonzalez for 5 years of service. He also congratulated and recognized Johnny Leiker on his retirement after 36 years of service. A Question and Answer session was then opened. There were questions regarding the building of the new chemical shed at the Lowe facility and on the sales of EKC and WindRiver. Early redemptions of stock up to $1,000 were given to Marlene Clark, Greg Hands, Toni Horton, Clara Fae Schweer and Kyle Miller. Pete Maestas announced the winners of the 4-Wheeler as Lear Farms; Gary Richmeier the gun safe; Clayton Unruh, Rome Brothers, and Mike Standley all won $500 Gift Cards. It was moved and seconded that the meeting be adjourned.

13 13 Lowe Fertilizer/Chemical Storage

14 14 Tom Mulville, Chairman Bruce Howard, Secretary Tim Miller, Vice-Chairman Tyler Hands Mike Deaver Bill Maughlin Lynn Teeter

15 15 ASSOCIATE BOARD MEMBERS Chris Fullmer Nate Bingaman Chris Boyd Clayton Maddux

16 16 Tyler Hands Gordon Drees Tyler Hands was raised in the Plymell community just South of Garden City. After graduating from Garden City High School, Tyler attended Kansas Tyler Hands State was University raised in where the Plymell he majored community in Milling just South Science of Garden and City. After Management graduating from and Garden minored City in High Leadership School, Tyler Studies. attended He Kansas is now State back University helping out where on the majored family farm in Milling south Science of Garden and Management City and south and of minored Deerfield. in Leadership They raise Studies. irrigated He is wheat, now back milo, helping corn, out and on the soybeans family farm and south also of dryland Garden wheat City and and south milo. of Deerfield. They raise irrigated wheat, milo, corn, and soybeans and also dryland wheat and milo. Tyler is the fourth generation to help farm the family farm starting with his Tyler is the fourth generation to help farm the family farm starting with his greatgrandfather, V.V. Hands, V.V. Hands, then his then grandfather, his grandfather, Fielding Hands, Fielding followed Hands, by his great-grandfather, followed father, Greg by his Hands. father, All Greg three previously Hands. All served three on previously the Board served of Directors. on the Board of Directors. Tyler and his wife, Amanda, have 3 daughters. They belong to the First United Tyler Methodist and his Church. wife, Tyler Amanda, also enjoys have a hunting daughter, and fishing. Macy. They belong to the First United Methodist Church. Tyler also enjoys hunting and fishing. Tyler became an Associate Director of the Garden City Co-op in December Tyler became an Associate Director of the Garden City Co-op in December Gordon Drees was raised Northeast of Garden City. He attended Garden City High School and Kansas State University where he majored in Agricultural Technology Management and minored in Business. He worked in the grain industry after college and is now back helping with the family farm north east of Garden City. They raise wheat, corn and milo. Gordon is a fifth generation farmer. Gordon and his wife, Kelly have one son, Cooper. They belong to the Trinity Lutheran Church. Gordon served as an Associate Director of the Garden City Co-op between December 2011 and December 2013.

17 17 Without continual growth and progress, such words as improvement, achievement and success have no meaning. Benjamin Franklin