THE I. A. A, RECORD 



Page Thirteen 



Farm Supply Company 



Has a Successful Year 



Declare Patronage Dividends to 36 

 Member Companies of $38,307.89 



L. R. Marchant 



A PAID-IN capital stock totaling 

 $254,000 in the 15 new county 

 service companies organized during 

 1930 with an aggregate sum of $620,- 

 500 to represent the farmers' invest- 

 rrvent in the 36 companies affiliated 

 with the Illinois Farm Supply Company 

 as of August 31, 1930, was reported 

 by Manager L. R. 

 Marchant at the an- 

 nuni meeting of the 

 company in Bloom- 

 ington on Oct. 14. 

 A comparison of 

 the gasoline sales for 

 the 'first six months 

 of the calendar year, 

 made a V ai I a b 1 e 

 through the state 

 gas tax, discloses that 

 the total gallonage 

 of all member com- 

 panies places the Illinois Farm Supply 

 Company and its associates in the fifth 

 or sixth rank among the distributors in 

 Illinois. Only four or five of tlie 752 

 hcensed distributors show a larger busi- 

 ness. :v ■■':. t' '■" ••■ ■'■ 

 20,000,000 Gallons 



Petroleum products purchased dur- 

 ing the fiscal year of the company ap- 

 proximate 20,000,000 gallons. This is 

 equivalent to 1,623 tank cars of gaso- 

 line, 68 5 cars of kerosene, and 57 cars 

 of distillate and fuel oil, 572,644 gal- 

 lons of lubricating oils, and 405,3 51 

 pounds of grease. In comparison to 

 the volume handled the preceding year 

 this is a gain of 47 per cent in gasoline, 

 69 per cent in kerosene and distillate, 

 52 per cent in lubricating oils, and 123 

 per cent in grease. ;;•''..,■.;..■■. 



Of the 16 companies in operation for 

 a full 12 months' period prior to the 

 close of the 1929 fiscal year, only five 

 failed to make an increase in their busi- 

 ness the past year, and the remaining 

 11 made gains ranging from 7 to 80 

 per cent. 



Purchases Increase 



In addition to distributing petroleum 

 products, the company during the past 

 fiscal year supplied member companies 

 and farm bureaus with 344,900 pounds 

 of Atlacide calcium chlorate, a weed- 

 killer. Fly spray to the amount of 

 6,080 gallons also was purchased by the 

 31 companies featuring tiiis product for 

 the first season. 



In spite of lower prices, the com- 

 pany's purchases totaled $1,570,469.16, 



which is an increase of $400,000 over 

 last year's purchases. 



The capital stock of the state com- 

 pany includes 620 J4 shares of preferred 

 A 7 per cent cumulative stock having 

 a par value of $100 per share and 

 held by the 36 member companies. 

 Common stock outstanding consists of 

 36 shares at $1 per share which is held 

 by the member companies and entitles 

 them to participate in patronage re- 

 funds. 



Total operating income for the year 

 was $79,387.08, an increase of 73.9 per 

 cent over last year. The brokerage in- 

 come of $58,916.95 was an advance of 

 49 per cent, and the trading income 

 trebled with $20,470.13 resulting from 

 profits on purchases and sales. 



Operating expenses were $25,862.3 5, 

 or 32.6 per cent, of the gross income 

 compared to $15,834.58, or 34.69 per 

 cent, for the year ending August 31, 

 1929. 



Good Net Income :.../:.; 



The net operating income of $5 3,- 

 5 24.73 with the additional income from 

 interest and discounts earned of $6,- 

 401.76, less deductions of discounts al- 

 lowed, trade mark expanse, and federal 

 income tax, resulted in a net income of 

 $54,277.96, which is 68.37 per cent 

 of the gross operating income as com- 

 pared to $30,534.05, or 66.9 per cent, 

 for tiie preceding year. On the basis 

 of the paid-in capital stock of all com- 

 panies which were in Of>eration prior 

 to August 31, the earnings represent a 

 profit of 93.51 per cent in comparison 

 to 85 per cent on the paid-in capital 

 the year before. 



A reserve in the amount of $3,200.77 

 has been established for the payment of 

 Capital stock dividends and also a re- 

 serve in the amount of $38,307.89 for 

 the payment of patronage refunds. The 

 latter amount represents 48.2 5 per cent 

 of the gross income and the net addi- 

 tion of $15,970.07 to surplus, 20 per 

 cent of gross income. 



Net Worth $87,777.55 



The net worth of the company is 

 represented by a capital stock invest- 

 ment of $64,586 and a surplus of $23,- 

 191.5 5. '•^•■v^r^,.!;:-- 



Records show close to 50,000 cus- 

 tomers who are patronizing the 36 com- 

 panies affiliated with the Illinois Farm 

 Supply Company. In the territory 

 served there are an estimated 3 5,350 

 Farm Bureau members. 



Manager Marchant called attention in 

 his report to an article published re- 

 cently in one of the leading petroleum 

 magazines under the heading "The 

 Weakness of Co-Operative Oil Com- 

 panies Is Their Lack of Selling Experi- 

 ence." "This is a challenge to our or- 



Federal Farm Board 



C CONSOLIDATION of unprofit.iblo 

 > wheat farms into larger units was 

 advocated in a recent address by Chair- 

 man Legge of the Farm Board before 

 the Mortgage Bankers' Association of 

 America, meeting at Detroit. 



"Studies made by the agricultural 

 colleges indicate that the time has 

 passed when wheat can be grown prof- 

 itably on small acreages," said Mr. 

 Legge. "This, in our estimation, means 

 a readjustment in the side of the farm 

 unit where wheat is depended upon as 

 a cash crop. 



"Each individual company represented 

 here," said Mr. Legge, "probably has 

 cases where they have an unsatisfactory 

 loan on an 80 or 160 acre tract, where 

 an analysis of the subject would indi- 

 cate the loan on the present basis of 

 operation is likely to continue unpaid, 

 but by consolidating two or more of 

 these tracts in one unit, which would 

 in most cases probably involve refinanc- 

 ing of the larger unit, you could, in 

 our judgment bring about a situation 

 where the borrower was in ptosition to 

 ofierate successfully. 



"In other words, make one, borrower 

 a good credit risk where you now have 

 two or three bad ones." legge stales 

 that a similar situation exists in the pro- . 

 duct ion of cotton. 



ganization," he said. "We have the 

 choice of standing innocently by and 

 watching our competitors take a cer- 

 tain percentage of the business because 

 of superior salesmanship, or that of 

 constantly striving to build up the eHi- 

 ciency of our own organization vhich 

 will do much to strengthen tiie move- 

 ment throughout the state and place 

 co-operatives in general on a iiigher 

 plane." 



The sale of plant and equipment and 

 all the physical assets of Cornstalk 

 Products Company at Danville, Illinois, 

 was ordered recently by the U. S. Dis- 

 trict Court by Judge Walter C. Lind- 

 ley. The sale of assets was asked for 

 in a petition filed by attorneys for the 

 Federal Court. 



Plant and equipment inventories at 

 around $750,000, according to the at- 

 torneys for receivers, and approximate- 

 ly $2,500,000 has been expended at the 

 plant. The general indebtedness is 

 around $700,000, not including the in- 

 vestment of stockholders. 



The Cornstalk plant at Danville, 

 erected several years ago, specialized 

 in producing pulp from cornstalks for 

 manufacturing paper. 



¥ 



