Segment Reporting

6 Months Ended

Feb. 28, 2014

Segment Reporting [Abstract]

Segment Reporting

        Segment Reporting

We have aligned our segments based on an assessment of how our businesses are operated and the products and services they sell.

Our Energy segment produces and provides primarily for the wholesale distribution of petroleum products and transportation of those products. Our Ag segment purchases and further processes or resells grains and oilseeds originated by our country operations business, by our member cooperatives and by third parties, and also serves as a wholesaler and retailer of crop inputs. Corporate and Other primarily represents the non-consolidated wheat milling and packaged food joint ventures, as well as our business solutions operations, which consist of commodities hedging, insurance and financial services related to crop production.

Corporate administrative expenses are allocated to each business segment, and Corporate and Other, based on direct usage for services that can be tracked, such as information technology and legal, and other factors or considerations relevant to the costs incurred.

Many of our business activities are highly seasonal and operating results will vary throughout the year. Historically, our income is generally lowest during the second fiscal quarter and highest during the third fiscal quarter. For example, in our Ag segment, agronomy and country operations businesses experience higher volumes and income during the spring planting season and in the fall, which corresponds to harvest. Also in our Ag segment, our grain marketing operations are subject to fluctuations in volumes and earnings based on producer harvests, world grain prices and demand. Our Energy segment generally experiences higher volumes and profitability in certain operating areas, such as refined products, in the summer and early fall when gasoline and diesel fuel usage is highest and is subject to global supply and demand forces. Other energy products, such as propane, may experience higher volumes and profitability during the winter heating and crop drying seasons.

Our revenues, assets and cash flows can be significantly affected by global market prices for commodities such as petroleum products, natural gas, grains, oilseeds, crop nutrients and flour. Changes in market prices for commodities that we purchase without a corresponding change in the selling prices of those products can affect revenues and operating earnings. Commodity prices are affected by a wide range of factors beyond our control, including the weather, crop damage due to disease or insects, drought, the availability and adequacy of supply, government regulations and policies, world events, and general political and economic conditions.

While our revenues and operating results are derived from businesses and operations which are wholly-owned and majority-owned, a portion of our business operations are conducted through companies in which we hold ownership interests of 50% or less and do not control the operations. We account for these investments primarily using the equity method of accounting, wherein we record our proportionate share of income or loss reported by the entity as equity income from investments, without consolidating the revenues and expenses of the entity in our Consolidated Statements of Operations. In our Ag segment, this principally includes our 50% ownership in TEMCO, LLC (TEMCO). In Corporate and Other, these investments principally include our 50% ownership in Ventura Foods and our 24% ownership in Horizon Milling, LLC and Horizon Milling G.P.

Reconciling Amounts represent the elimination of revenues between segments. Such transactions are executed at market prices to more accurately evaluate the profitability of the individual business segments.

Segment information for the three and six months endedFebruary 28, 2014 and February 28, 2013 is as follows:

	Energy			Ag			Corporate and Other			Reconciling Amounts			Total
For the Three Months Ended February 28, 2014:
Revenues	$	3,468,978		$	6,319,972		$	17,445		$	(126,121	)	$	9,680,274
Cost of goods sold	3,178,431			6,186,541			(11		)	(126,121		)	9,238,840
Gross profit	290,547			133,431			17,456			—			441,434
Marketing, general and administrative	40,148			97,879			17,744						155,771
Operating earnings	250,399			35,552			(288		)	—			285,663
(Gain) loss on investments				116			(2,725		)				(2,609		)
Interest, net	18,692			9,076			1,221						28,989
Equity (income) loss from investments	(849		)	(8,213		)	(21,987		)				(31,049		)
Income before income taxes	$	232,556		$	34,573		$	23,203		$	—		$	290,332
Intersegment revenues	$	(126,121	)							$	126,121		$	—
For the Three Months Ended February 28, 2013:
Revenues	$	2,815,736		$	7,150,228		$	19,371		$	(102,957	)	$	9,882,378
Cost of goods sold	2,505,801			7,009,448			(561		)	(102,957		)	9,411,731
Gross profit	309,935			140,780			19,932			—			470,647
Marketing, general and administrative	41,183			74,401			19,096						134,680
Operating earnings	268,752			66,379			836			—			335,967
(Gain) loss on investments				(45		)							(45		)
Interest, net	32,388			17,826			3,171						53,385
Equity (income) loss from investments	2,155			(1,792		)	(17,123		)				(16,760		)
Income before income taxes	$	234,209		$	50,390		$	14,788		$	—		$	299,387
Intersegment revenues	$	(102,957	)							$	102,957		$	—
For the Six Months Ended February 28, 2014:

Revenues	$	7,148,212		$	13,808,060		$	34,208		$	(284,085	)	$	20,706,395
Cost of goods sold	6,683,771			13,464,370			(11		)	(284,085		)	19,864,045
Gross profit	464,441			343,690			34,219			—			842,350
Marketing, general and administrative	73,984			182,881			32,047						288,912
Operating earnings	390,457			160,809			2,172			—			553,438
(Gain) loss on investments				116			(2,725		)				(2,609		)
Interest, net	31,168			24,141			4,465						59,774
Equity (income) loss from investments	(2,157		)	(14,690		)	(46,880		)				(63,727		)
Income before income taxes	$	361,446		$	151,242		$	47,312		$	—		$	560,000
Intersegment revenues	$	(284,085	)							$	284,085		$	—
Goodwill	$	1,165		$	96,552		$	6,898					$	104,615
Capital expenditures	$	221,918		$	159,634		$	7,985					$	389,537
Depreciation and amortization	$	66,192		$	55,585		$	5,422					$	127,199
Total assets at February 28, 2014	$	4,230,665		$	7,539,817		$	2,533,775					$	14,304,257
For the Six Months Ended February 28, 2013:
Revenues	$	6,139,964		$	15,651,969		$	36,946		$	(236,563	)	$	21,592,316
Cost of goods sold	5,496,643			15,317,563			(1,492		)	(236,563		)	20,576,151
Gross profit	643,321			334,406			38,438			—			1,016,165
Marketing, general and administrative	77,654			145,388			36,120						259,162
Operating earnings	565,667			189,018			2,318			—			757,003
(Gain) loss on investments				(45		)							(45		)
Interest, net	78,171			36,038			6,386						120,595
Equity (income) loss from investments	271			(9,739		)	(35,364		)				(44,832		)
Income before income taxes	$	487,225		$	162,764		$	31,296		$	—		$	681,285
Intersegment revenues	$	(236,563	)							$	236,563		$	—
Goodwill	$	1,165		$	80,084		$	6,898					$	88,147
Capital expenditures	$	173,669		$	87,466		$	3,197					$	264,332
Depreciation and amortization	$	57,256		$	51,072		$	8,584					$	116,912
Total assets at February 28, 2013	$	3,656,974		$	7,660,135		$	1,848,797					$	13,165,906