CBH Group reports strong FY23 surplus
The CBH Group has reported a strong surplus for the 2023 financial year, propelled by a record harvest and outloading that saw the co-operative report a multitude of new operational records throughout the year.
The grower-owned co-operative today released its 2023 Annual Report, which outlines the financial and operational performance for the year ending 30 September 2023.
CBH reported a Group surplus of $353.3 million for the 2023 financial year, driven by the record harvest of 22.9 million tonnes, record shipping volumes, and favourable export margins early in the year.
CBH Chief Executive Officer Ben Macnamara said this strong financial result positions CBH to achieve the Board-endorsed Path to 2033 Strategy – generating more value and strengthening the network for current growers and future generations.
“This success was a year underpinned by a second consecutive record harvest delivered by Western Australian growers to CBH sites,” Mr Macnamara said.
“To grow and deliver back-to-back record crops is an outstanding achievement and is testament to the resilience, commitment and innovation of Western Australian growers, as well as the CBH team who helped to receive it.
“Together we set almost 100 new harvest records and achieved our second safest 12-month period on record.
“Critically it was also the first time in the co-operative’s 90-year history that we outturned a record 21.9 million tonnes to our international and domestic customers, with both records allowing CBH Operations to achieve its largest ever surplus of $156.1 million.”
The outturn program saw the supply chain ship a record 19.7 million tonnes from our port terminals, while road and grower subcontractors moved a record 8.3 million tonnes of grain directly to our ports, breaking nine monthly records.
Rail performance significantly improved during the year, with Aurizon helping to move a record 11 million tonnes, breaking 10 monthly rail records for the year in the process.
CBH invested a record $572.7 million into the network, including entering into three agreements that will significantly bolster the existing rail fleet by 24 locomotives and 650 wagons.
As part of this network investment, good progress was made on 11 rail outloading and siding projects, including the completion of the Brookton rail siding project and the start of construction at the Broomehill rapid rail outloading project.
During the year, 436,000 tonnes of permanent storage and 2.3 million tonnes of temporary storage was added to the CBH network, while a record $173.6 million was invested in more than 230 sustaining capital projects that will ensure the longevity and functionality of network assets.
CBH Marketing & Trading (M&T) reported a surplus of $176.3 million which was driven by increased export margins early in the year, a second consecutive record harvest in WA and the re-opening of the China barley market.
During the year, M&T bought 43 per cent of the record WA crop and paid $4.8 billion to WA growers, while shipping 8.9 million tonnes of grain.
“To support the Path to 2033 Strategy, $170 million of M&T’s surplus will be paid as a fully franked dividend to CBH for the sole purpose of network investment, with the remainder used to support the division’s equity position,” Mr Macnamara said.
CBH Fertiliser reported excellent growth in a year of transformation and expansion, with a record 232,000 tonnes sold.
This milestone was aided by the opening of the new Kwinana Fertiliser Terminal, entry into the liquid fertiliser market and significant growth in the Esperance region.
“CBH Fertiliser now holds an 11 per cent market share in Western Australia – well on its way to achieving its Path to 2033 strategic goal of holding a 15 per cent market share, and more importantly, creating competitive tension in the market,” Mr Macnamara said.
Looking ahead, Mr Macnamara said CBH was focused on achieving the ‘Path to 2033’ Strategy.
“By 2033, we want to increase how much we export to a peak of 3 million tonnes a month and critically, be able to outturn 70 per cent of the crop in the first half shipping window to maximise the value of WA growers’ grain,” Mr Macnamara said.
“As you will see in the Annual Report, we are making good progress on the Strategy with record-breaking supply chain performance and in December 2022, we exported 2.2 million tonnes.
“We remain focused on the core of our business, our storage and handling network, marketing and trading grain, and providing a secure and consistent supply of fertiliser for WA grain growers.
“Although we are having a smaller harvest this year, we project that over the coming decade the average crop size will continue to increase.
“Right now though, our focus is on ensuring we safely and efficiently receive the remainder of this year’s harvest.”
The 2023 Annual Report can be downloaded here.