By Tom Downey, MMPA Chief Financial Officer
Fiscal year 2023 was my first full year with MMPA serving as chief financial officer and I am proud to report your cooperative continues to have a strong balance sheet poised for future growth. Working alongside the entire MMPA team, board of directors and independent auditors to market our members’ milk to the greatest advantage possible has been the most personally rewarding experience I have had in my career.
While acquiring Superior Dairy on January 1, 2022, was a significant milestone for MMPA, the hard work really started after the purchase was announced. Integrating two companies that are both over 100 years old is a complicated process that has required a significant amount of effort across both organizations. While those efforts will continue into the foreseeable future, I am excited about all that we have accomplished around the integration to date. We have made significant headway in combining the organizations across several teams (human resources, IT, accounting, quality, operations, etc.) and have prioritized ensuring our colleagues in Canton feel connected to MMPA and our member owners.
We continued to see a tight milk market in fiscal year 2022, marketing 4.7 billion pounds of milk (flat to prior year). These tighter markets drove elevated milk pricing and product margin throughout the year but that was partially offset by elevated input costs which I know our member owners had to navigate at the farm level as well. Despite the current inflationary environment, I am pleased with the synergies we have achieved bringing Superior into our manufacturing footprint that helped negate some of those cost headwinds.
This year’s audit presented a unique challenge as Superior Dairy transitioned from an MMPA customer to being MMPA owned. Combining the books and records of two large organizations is a complex process and I’d like to thank everyone that was involved for ensuring that the audit was completed on time with an unqualified or “clean” audit opinion. We had a lot of staff go above and beyond the normal call of duty to make that happen and their efforts are very much appreciated.
MMPA’s long-term debt to equity ratio, an industry standard used by lenders to determine the risk associated with lending to an entity, is extremely strong relative to other market participants. You can think of this value as how much of the cooperative’s assets are owned by our members, versus how much is owned by our lenders. While the membership percentage has decreased from the prior year, we are still well positioned to move forward on future growth opportunities based on our financial strength.
The example our member owners set with their tireless work ethic and unwavering commitment to doing the right thing is an inspiration to me and the MMPA team. Thank you to all MMPA members for the opportunity to work for and serve you. I am excited for what the future has in store.
This article was originally published in the January/February 2023 issue of the Milk Messenger. Subscribe »