Viterra Records Q1 Profit

REGINA - Mar 12/08 - SNS -- Viterra reported net earnings of CDN $41.217 million on sales of $1,317.142 million for the first quarter ending January 31, compared to a net of $7.935 million on sales of $447.623 million during the same three month period last year.

The jump in sales and earnings reflects the impact of the merged operations of the Saskatchewan Wheat Pool and Agricore United. With the acquisition of Agricore United, the company expanded its total handling capacity from 1.1 million MT, to 1.9 million MT, an increase of about 66%. As a result, for the first quarter of fiscal 2008, Viterra shipped 4.2 million MT of grains and oilseeds from primary elevators, compared to 2.2 million MT in the same quarter of 2007, an increase of about 90.6%. The improvement in shipments relative to capacity reflects a higher turnover ratio in the current year as the company now has greater efficiencies in its grain handling pipeline.

Viterra determines its market share based on primary elevator receipts and as noted in the company's 2007 Annual Report, market share following the integration of Agricore United was expected to normalize at about 42% (on the six major grains). Market share for the first quarter of 2008 was consistent with this target.

The split between CWB and non-CWB commodities shipments for the three-month period was 42:58 compared to 56:44 for the same period last year, while the industry's ratio for the three months ended January 31, 2008 was 51:49 compared to 60:40 in the three months ended January 31, 2007. During the first quarter of 2008, the company completed the execution of a number of feed barley shipments, based on contracts which were secured during the temporary de-regulation of the CWB's barley program last fall. As a result, those shipments were categorized as non-Board shipments contributing to the heavier weighting to non-CWB shipments for the period. Additionally, as the leading merchandiser and exporter of oilseeds and pulses in Western Canada and with strong worldwide demand, the company 's weighting to non-CWB commodities will be higher than in the prior year as Viterra is better positioned to capture incremental margin opportunities in these markets.

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