Dairy Business Analysis Project: 2000 Financial Summary

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Title:
Dairy Business Analysis Project: 2000 Financial Summary
Physical Description:
Fact Sheet
Creator:
de Vries, A.
Publisher:
University of Florida Cooperative Extension Service, Institute of Food and Agriculture Sciences, EDIS
Place of Publication:
Gainesville, Fla.
Publication Date:

Notes

Acquisition:
Collected for University of Florida's Institutional Repository by the UFIR Self-Submittal tool. Submitted by Melanie Mercer.
Publication Status:
Published
General Note:
"Original publication date December 3, 2002. Reviewed January 2008, and March 2011."
General Note:
"AN135"

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Source Institution:
University of Florida Institutional Repository
Holding Location:
University of Florida
Rights Management:
All rights reserved by the submitter.
System ID:
IR00003763:00001


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A. de Vries, R. Giesy, L. Ely, D. Webb, A. Andreasen, B. Broaddus, P. Miller, T. Seawright, C. Vann, A. de Araujo2

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Dairy Business Analysis Project: 2000 Financial Summary 2

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Dairy Business Analysis Project: 2000 Financial Summary 3 DBAP 2000 Summary Milk per cow (lbs/year) by heifers per cow. DBAP 2000 Summary Net farm income from operations (NFIFO) per cwt ($) by heifers per cow. DBAP 2000 Summary Net farm income from operations (NFIFO) per cwt ($) by total expenses per cwt ($). DBAP 2000 Summary Net farm income from operations (NFIFO) per cwt ($) by milk per cow (lbs/year).

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Dairy Business Analysis Project: 2000 Financial Summary 4 DBAP 2000 Summary Net farm income from operations (NFIFO) per cwt ($) by average number of cows (lbs). X-axes not shown to prevent identification of farms.

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Dairy Business Analysis Project: 2000 Financial Summary 5 DBAP 2000 Summary Business size and production efficiency by state and overall average, median, standard deviation. Overall State Averages Category Average Median Std1 Florida Georgia Number of farms 23 23 23 17 6 Business size Average number of cows 1,079 624 8991,142 900 Average number of heifers 615 348 747 707 356 Milk sold (million lbs) 20.5912.6619.4021.22 18.81 FTE workers 20 14 17 22 15 Acres of pasture + cultivated land 463 231 539 511 327 Production efficiency Milk sold/cow (lbs) 17,77817,3773,70216,907 20,249 Cows/FTE worker 53.8147.9419.0354.10 52.98 Milk sold/FTE worker (lbs) 0.96 0.89 0.37 0.91 1.08 Cull rate 0.38 0.36 0.11 0.40 0.32 1Standard deviation. DBAP 2000 Summary Revenues and expenses by state and overall average, median, standard deviation. Overall State Averages Category Average Median Std1 Florida Georgia Number of farms 23 23 23 17 6 Revenues (per cwt) Milk sold ($) 16.6916.75 0.7916.78 16.42 Raised, leased cow sales ($) 0.61 0.71 0.79 0.78 0.13 Heifer sales ($) 0.40 0.07 1.08 0.47 0.19 Gain on purchased livestock sales ($) (0.04)(0.06)0.63(0.12) 0.16 Other revenues ($) 0.50 0.59 0.62 0.41 0.80 Total revenues ($) 18.1618.06 1.7618.32 17.70 Expenses (per cwt) Personnel ($) 2.66 2.66 0.87 2.89 1.99 Purchased feed ($) 6.94 7.09 1.74 7.47 5.45 Crops ($) 0.27 0.05 0.42 0.16 0.58 Machinery ($) 0.86 0.77 0.53 0.78 1.11 Livestock ($) 1.69 1.62 0.92 1.69 1.70 Milk marketing ($) 1.10 1.07 0.36 0.99 1.42 Buildings and land ($) 0.63 0.41 0.64 0.48 1.05 Interest ($) 0.65 0.58 0.43 0.70 0.50 Depreciation: Livestock ($) 0.88 0.66 0.76 0.89 0.84 Machinery ($) 0.44 0.35 0.41 0.38 0.61 Buildings ($) 0.22 0.18 0.18 0.22 0.20 Other expenses ($) 0.74 1.10 0.32 0.78 0.64 Total expenses ($) 17.0816.54 2.4917.43 16.09 Net farm income from operations ($) 1.07 1.28 2.07 0.88 1.60 1Standard deviation.

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Dairy Business Analysis Project: 2000 Financial Summary 6 DBAP 2000 Summary Financial ratios by state and overall average, median, standard deviation. Overall State Averages Category Average Median Std1 Florida Georgia Number of farms 23 23 23 17 6 Liquidity Current ratio 2.02 0.89 2.29 1.40 3.80 Working capital ($) (8,319)(5,760)632,552(137,199) 356,840 Solvency Debt to asset ratio 0.36 0.36 0.20 0.36 0.35 Equity to asset ratio 0.64 0.64 0.20 0.64 0.65 Debt to equity ratio 0.74 0.57 0.64 0.72 0.79 Profitability Rate of return on assets 0.07 0.05 0.08 0.07 0.08 Rate of return on equity 0.07 0.04 0.14 0.06 0.09 Operating profit margin ratio 0.06 0.06 0.13 0.05 0.08 Financial efficiency Asset turnover rate 0.89 0.79 0.46 0.83 1.07 Operating expense ratio 0.82 0.83 0.10 0.83 0.79 Depreciation expense ratio 0.08 0.08 0.04 0.08 0.09 Interest expense ratio 0.04 0.03 0.02 0.04 0.03 Net farm income ratio 0.06 0.07 0.12 0.05 0.09 Repayment capacity Cash flow coverage ratio 4.24 0.87 8.71 3.65 5.94 Term debt coverage ratio1 9.93 0.94 38.4413.10 0.94 Capital replacement margin ($)2 145,54415,799578,631167,361 83,731 1Term debt and capital lease coverage ratio. 2Capital replacement and term debt repayment margin. DBAP 2000 Summary Balance sheet by state and overall average, median, standard deviation. Overall State Averages Category Average Median Std1 Florida Georgia Number of farms 23 23 23 17 6 Balance sheet (January 1) Current assets/cow ($) 459 384 354 362 734 Total assets/cow ($) 4,584 3,978 2,620 4,657 4,376 Current liabilities/cow ($) 566 420 480 632 378 Total liabilities/cow ($) 1,392 1,384 790 1,441 1,255 Equity/cow ($) 3,191 2,196 2,875 3,216 3,121 Balance sheet (December 31) Current assets/cow ($) 405 398 267 353 552 Total assets/cow ($) 4,580 4,088 2,361 4,778 4,017 Current liabilities/cow ($) 425 394 316 508 190 Total liabilities/cow ($) 1,438 1,300 827 1,559 1,093 Equity/cow ($) 3,142 2,107 2,373 3,219 2,924 1Standard deviation.

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Dairy Business Analysis Project: 2000 Financial Summary 7 DBAP 2000 Summary Business size and production efficiency by average number of cows and milk per cow. Average number of cows Milk per cow (lbs/year) Category < 400 4001,600 > 1,600 < 16,000 16,00019,000 > 19,000 Number of farms 7 9 7 7 9 7 Business size Average number of cows 251 8772,1674441,273 1,465 Average number of heifers 149 4321,316315 569 975 Milk sold (million lbs) 3.5117.2142.026.3822.29 32.63 FTE workers 5 18 38 10 21 30 Acres of pasture + cultivated land196 305 933 360 507 510 Production efficiency Milk sold/cow (lbs) 14,02519,85218,86513,77817,554 22,068 Cows/FTE worker 49.3153.3158.9448.7063.24 46.79 Milk sold/FTW worker (lbs) 0.691.041.120.67 1.11 1.05 Cull rate 0.42 0.35 0.38 0.39 0.40 0.34 DBAP 2000 Summary Revenues and expenses by average number of cows and milk per cow. Average number of cows Milk per cow (lbs/year) Category < 400 4001,600 > 1,600 < 16,000 16,00019,000 > 19,000 Number of farms 7 9 7 7 9 7 Revenues (per cwt) Milk sold ($) 16.7816.3217.0716.9016.83 16.30 Raised, leased cow sales ($) 1.160.360.391.150.34 0.43 Heifer sales ($) 0.660.160.450.320.85 (0.11) Gain on purchased livestock sales ($)(0.04)(0.04)(0.06)(0.28)0.21 (0.14) Other revenues ($) 0.940.260.380.730.35 0.47 Total revenues ($) 19.5017.0618.2318.8218.58 16.95 Expenses (per cwt) Personnel ($) 2.532.812.592.492.83 2.60 Purchased feed ($) 7.816.496.668.046.79 6.04 Crops ($) 0.420.200.220.420.16 0.27 Machinery ($) 1.070.740.811.080.66 0.91 Livestock ($) 1.671.751.641.391.94 1.67 Milk marketing ($) 1.310.961.071.271.04 1.01 Buildings and land ($) 0.980.440.530.930.60 0.38 Interest ($) 0.800.540.640.860.55 0.55 Depreciation: Livestock ($) 0.940.691.040.661.42 0.39 Machinery ($) 0.600.460.270.610.25 0.52 Buildings ($) 0.280.160.210.320.13 0.21 Other expenses ($) 0.690.690.860.710.69 0.86 Total expenses ($) 19.1015.9316.5418.7817.06 15.41 Net farm income from operations ($) 0.39 1.12 1.69 0.04 1.52 1.53

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Dairy Business Analysis Project: 2000 Financial Summary 8 DBAP 2000 Summary Financial ratios by average number of cows and milk per cow. Average number of cows Milk per cow (lbs/year) Category < 400 4001,600 > 1,600 < 16,000 16,00019,000 > 19,000 Number of farms 7 9 7 7 9 7 Liquidity Current ratio 1.202.791.871.29 2.19 2.55 Working capital ($) (42,456)59,076(60,834)(27,969)(23,594) 30,969 Solvency Debt to asset ratio 0.360.330.400.35 0.36 0.37 Equity to asset ratio 0.640.670.600.65 0.64 0.63 Debt to equity ratio 0.720.650.890.67 0.79 0.74 Profitability Rate of return on assets 0.030.060.110.01 0.09 0.10 Rate of return on equity 0.020.060.12(0.03)0.10 0.13 Operating profit margin ratio (0.04)0.080.12(0.04)0.09 0.11 Financial efficiency Asset turnover rate 0.860.900.920.61 1.11 0.89 Operating expense ratio 0.850.830.790.87 0.79 0.81 Depreciation expense ratio 0.100.080.080.09 0.10 0.07 Interest expense ratio 0.040.030.040.05 0.03 0.03 Net farm income ratio 0.010.070.09(0.00)0.08 0.09 Repayment capacity Cash flow coverage ratio 1.284.217.251.60 6.97 3.38 Term debt coverage ratio1 0.852.4828.590.4923.81 1.52 Capital replacement margin ($)2 (19,886)9,977485,276(52,825)357,616 71,250 1Term debt and capital lease coverage ratio. 2Capital replacement and term debt repayment margin. DBAP 2000 Summary Balance sheet by average number of cows and milk per cow. Average number of cows Milk per cow (lbs/year) Category < 400 4001,600 > 1,600 < 16,000 16,00019,000 > 19,000 Number of farms 7 9 7 7 9 7 Balance sheet (January 1) Current assets/cow ($) 219478 676 257 411 724 Total assets/cow ($) 5,4174,3804,0135,799 3,456 4,819 Current liabilities/cow ($) 362518 831 359 645 670 Total liabilities/cow ($) 1,3841,2021,6461,518 1,067 1,686 Equity/cow ($) 4,0333,1782,3674,282 2,389 3,133 Balance sheet (December 31) Current assets/cow ($) 213433 559 223 388 607 Total assets/cow ($) 5,5464,3303,9335,889 3,575 4,562 Current liabilities/cow ($) 360364 567 319 416 542 Total liabilities/cow ($) 1,6231,2611,4801,779 1,167 1,444 Equity/cow ($) 3,923 3,069 2,454 4,110 2,408 3,117

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Dairy Business Analysis Project: 2000 Financial Summary 9 DBAP 2000 Summary Business size and production efficiency by net farm income from operations per cwt and rate of return on assets. Net farm income from operations/cwt ($) Rate of return on assets (%) Category < $0.30 $0.30-$2.00 > $2.00 < 2.5% 2.5%-8.5% > 8.5% Number of farms 7 9 7 7 9 7 Business size Average number of cows 878 975 1,414726 711 1,906 Average number of heifers 589 538 741 506 402 999 Milk sold (million lbs) 14.63 18.21 29.6112.0913.17 38.64 FTE workers 19 18 24 17 13 32 Acres of pasture + cultivated land504 250 696 364 366 686 Production efficiency Milk sold/cow (lbs) 15,43818,94118,62415,54118,109 19,591 Cows/FTE worker 42.60 55.67 62.6242.0454.49 64.70 Milk sold/FTW worker (lbs) 0.66 1.01 1.18 0.66 0.96 1.25 Cull rate 0.42 0.33 0.39 0.43 0.33 0.39 DBAP 2000 Summary Revenues and expenses by net farm income from operations per cwt and rate of return on assets. Net farm income from operations/cwt ($) Rate of return on assets (%) Category < $0.30 $0.30-$2.00 > $2.00 < 2.5% 2.5%-8.5% > 8.5% Number of farms 7 9 7 7 9 7 Revenues (per cwt) Milk sold ($) 16.8416.34 16.9916.6916.42 17.02 Raised, leased cow sales ($) 0.91 0.33 0.680.950.33 0.63 Heifer sales ($) 0.58 0.24 0.420.500.28 0.45 Gain on purchased livestock sales ($)(0.28)(0.05) 0.21(0.27)(0.00) 0.12 Other revenues ($) 0.43 0.31 0.790.390.57 0.55 Total revenues ($) 18.4817.17 19.0918.2617.60 18.77 Expenses (per cwt) Personnel ($) 3.45 2.46 2.133.512.06 2.57 Purchased feed ($) 8.11 6.68 6.118.466.00 6.63 Crops ($) 0.28 0.18 0.400.180.44 0.15 Machinery ($) 0.92 0.84 0.840.880.99 0.69 Livestock ($) 2.07 1.49 1.571.891.61 1.60 Milk marketing ($) 1.03 1.08 1.200.991.24 1.02 Buildings and land ($) 0.48 0.64 0.770.361.06 0.36 Interest ($) 0.97 0.50 0.520.870.57 0.53 Depreciation: Livestock ($) 0.81 0.87 0.950.810.68 1.19 Machinery ($) 0.58 0.46 0.290.550.57 0.17 Buildings ($) 0.30 0.10 0.280.250.21 0.18 Other expenses ($) 0.65 0.67 0.880.610.74 0.89 Total expenses ($) 19.6515.97 15.9419.3616.17 15.98 Net farm income from operations ($) 1.17 1.20 3.15 (1.10) 1.43 2.78

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Dairy Business Analysis Project: 2000 Financial Summary 10 DBAP 2000 Summary Financial ratios by net farm income from operations per cwt and rate of return on assets. Net farm income from operations/cwt ($) Rate of return on assets (%) Category < $0.30 $0.30-$2.00 > $2.00 < 2.5% 2.5%-8.5% > 8.5% Number of farms 7 9 7 7 9 7 Liquidity Current ratio 0.60 2.37 3.010.61 2.78 2.47 Working capital ($) (190,075)(185,020)400,622(86,138)(20,360) 84,979 Solvency Debt to asset ratio 0.44 0.32 0.320.39 0.33 0.37 Equity to asset ratio 0.56 0.68 0.680.61 0.67 0.63 Debt to equity ratio 0.92 0.73 0.570.78 0.71 0.74 Profitability Rate of return on assets (0.01) 0.06 0.16(0.01)0.05 0.17 Rate of return on equity (0.07) 0.06 0.21(0.07)0.04 0.24 Operating profit margin ratio (0.07) 0.07 0.16(0.07)0.07 0.17 Financial efficiency Asset turnover rate 0.63 0.93 1.110.60 0.93 1.14 Operating expense ratio 0.92 0.82 0.730.93 0.81 0.74 Depreciation expense ratio 0.09 0.08 0.080.09 0.08 0.08 Interest expense ratio 0.05 0.03 0.030.05 0.03 0.03 Net farm income ratio (0.07) 0.07 0.17(0.06)0.08 0.15 Repayment capacity Cash flow coverage ratio 0.73 3.32 8.940.78 4.12 7.86 Term debt coverage ratio1 0.46 1.64 30.060.51 0.83 31.05 Capital replacement margin ($)2 (279,085)167,497541,949(206,211)11,974 669,034 1Term debt and capital lease coverage ratio. 2Capital replacement and term debt repayment margin. DBAP 2000 Summary Balance sheet by net farm income from operations per cwt and rate of return on assets. Net farm income from operations/cwt ($) Rate of return on assets (%) Category < $0.30 $0.30-$2.00 > $2.00 < 2.5% 2.5%-8.5% > 8.5% Number of farms 7 9 7 7 9 7 Balance sheet (January 1) Current assets/cow ($) 377 414 600 324 480 568 Total assets/cow ($) 5,9864,193 3,6846,1484,103 3,639 Current liabilities/cow ($) 711 403 629 631 374 746 Total liabilities/cow ($) 1,7761,123 1,3561,6421,083 1,541 Equity/cow ($) 4,2093,071 2,3284,5063,020 2,098 Balance sheet (December 31) Current assets/cow ($) 276 353 600 250 403 562 Total assets/cow ($) 5,9994,080 3,8026,1934,024 3,681 Current liabilities/cow ($) 512 389 384 449 325 528 Total liabilities/cow ($) 2,2291,091 1,0922,0211,131 1,249 Equity/cow ($) 3,770 2,990 2,710 4,172 2,893 2,432

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Dairy Business Analysis Project: 2000 Financial Summary 11 DBAP 2000 Summary Business size and production efficiency by assets per cow and liabilities per cow. Assets per cow ($) Liabilities per cow ($) Category < $3,400 $3,400$4,500 > $4,500 < $1,000 $1,000$1,800 > $1,800 Number of farms 7 9 7 7 9 7 Business size Average number of cows 818 1,473 833667 1,093 1,472 Average number of heifers 292 806 693363 374 1,177 Milk sold (million lbs) 16.2325.9918.0112.0420.55 29.19 FTE workers 13 28 17 13 17 31 Acres of pasture + cultivated land179 649 508469 262 715 Production efficiency Milk sold/cow (lbs) 17,78017,51318,11916,82818,387 17,946 Cows/FTE worker 58.1956.3946.1155.7059.50 44.60 Milk sold/FTW worker (lbs) 1.03 0.98 0.850.92 1.09 0.82 Cull rate 0.39 0.37 0.38 0.38 0.38 0.37 DBAP 2000 Summary Revenues and expenses by assets per cow and liabilities per cow. Assets per cow ($) Liabilities per cow ($) Category < $3,400 $3,400$4,500 > $4,500 < $1,000 $1,000$1,800 > $1,800 Number of farms 7 9 7 7 9 7 Revenues (per cwt) Milk sold ($) 16.7516.8616.4116.6316.81 16.59 Raised, leased cow sales ($) 0.18 0.85 0.740.490.65 0.69 Heifer sales ($) 0.66 0.62(0.14)(0.13)0.69 0.55 Gain on purchased livestock sales ($)0.30(0.09)(0.33)0.07(0.13) (0.05) Other revenues ($) 0.71 0.36 0.460.210.68 0.56 Total revenues ($) 18.6018.6017.1417.2718.70 18.34 Expenses (per cwt) Personnel ($) 2.02 3.10 2.722.452.39 3.21 Purchased feed ($) 6.49 7.58 6.577.196.19 7.66 Crops ($) 0.28 0.24 0.310.210.35 0.24 Machinery ($) 0.77 0.74 1.130.930.88 0.79 Livestock ($) 1.98 1.67 1.431.142.01 1.84 Milk marketing ($) 1.40 0.93 1.011.071.20 0.99 Buildings and land ($) 1.18 0.39 0.400.680.76 0.42 Interest ($) 0.56 0.71 0.650.330.62 1.01 Depreciation: Livestock ($) 1.28 0.89 0.460.741.38 0.36 Machinery ($) 0.35 0.26 0.760.520.32 0.52 Buildings ($) 0.11 0.19 0.360.240.16 0.26 Other expenses ($) 0.61 0.76 0.850.810.68 0.74 Total expenses ($) 17.0317.4616.6516.3116.94 18.04 Net farm income from operations ($) 1.58 1.14 0.48 0.96 1.76 0.29

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Dairy Business Analysis Project: 2000 Financial Summary 12 DBAP 2000 Summary Financial ratios by assets per cow and liabilities per cow. Assets per cow ($) Liabilities per cow ($) Category < $3,400 $3,400$4,500 > $4,500 < $1,000 $1,000$1,800 > $1,800 Number of farms 7 9 7 7 9 7 Liquidity Current ratio 1.911.942.262.882.45 0.62 Working capital ($) 157,940(125,613)(23,773)188,88851,408 (282,319) Solvency Debt to asset ratio 0.430.430.200.130.43 0.51 Equity to asset ratio 0.570.570.800.870.57 0.49 Debt to equity ratio 0.940.950.280.150.89 1.13 Profitability Rate of return on assets 0.090.080.030.050.11 0.04 Rate of return on equity 0.120.060.030.040.13 0.02 Operating profit margin ratio 0.070.090.000.020.10 0.04 Financial efficiency Asset turnover rate 1.350.840.500.73 1.12 0.76 Operating expense ratio 0.800.830.840.840.77 0.86 Depreciation expense ratio 0.090.070.090.090.10 0.06 Interest expense ratio 0.030.040.040.020.03 0.05 Net farm income ratio 0.080.060.030.050.09 0.02 Repayment capacity Cash flow coverage ratio 2.446.223.518.873.46 0.62 Term debt coverage ratio1 0.8723.631.3727.033.74 0.79 Capital replacement margin ($)2 86,519246,67774,542337,988181,075 (92,581) 1Term debt and capital lease coverage ratio. 2Capital replacement and term debt repayment margin. DBAP 2000 Summary Balance sheet by assets per cow and liabilities per cow. Assets per cow ($) Liabilities per cow ($) Category < $3,400 $3,400$4,500 > $4,500 < $1,000 $1,000$1,800 > $1,800 Number of farms 7 9 7 7 9 7 Balance sheet (January 1) Current assets/cow ($) 441 430 516 324 540 491 Total assets/cow ($) 2,630 3,921 7,390 5,950 3,402 4,738 Current liabilities/cow ($) 475 701 482 233 676 757 Total liabilities/cow ($) 1,258 1,603 1,257 478 1,429 2,260 Equity/cow ($) 1,372 2,318 6,133 5,472 1,973 2,478 Balance sheet (December 31) Current assets/cow ($) 413 381 426 323 471 401 Total assets/cow ($) 2,685 4,009 7,208 5,648 3,423 4,998 Current liabilities/cow ($) 362458 444 237 414 627 Total liabilities/cow ($) 1,131 1,730 1,368 580 1,371 2,382 Equity/cow ($) 1,554 2,279 5,840 5,068 2,053 2,616