How is Oma maa’s financial situation?
In 2021, Oma maa made a surplus of 117.679 euros due to the cancellation of one individual long-term loan. The cooperative's debts decreased overall. On December 31, 2021, debts amounted to 109.394 euros compared to 244.219 euros the year before. The surplus made in 2021 also reduced the accumulated deficit to a total of 73.659 euros.
Surplus reduced debts, but our financial situation remains tight
Although the cooperative’s debts decreased significantly in 2021, our financial condition still remains weak. Based on our calculations, 100 food members ordering a weekly food bag would be sufficient to cover the operational costs. In 2019 and 2020, the cooperative was able to improve its operative result as the number of ordered food bags increased. In 2021, the average number of weekly orders for food bags remained at 80.
Oma maa has been able to continue its operations in a challenging financial situation because member farmer Jukka Lassila has given ua loans. There were also new members who joined the cooperative, and our subscribed capital has increased to 77.200 euros.
Investments reduce our workload and provide an opportunity for development
During 2019 the cooperative acknowledged that in order to improve our operative results, we need investments in machinery and equipment, seedlings, and the development of our food processing.The first investments were made towards an irrigation system and a planting machine, which soon proved to be necessary in ensuring a good harvest. The need to strengthen the cooperative's equity came to the forefront.
Our funding instruments: a loan circle and a share issue
In the spring of 2021, Oma maa established a loan circle to enable the cooperative to make the necessary investments during the summer growth season.
35 members participated in the loan circle and a total of 22.720 euros in funding was raised. The loan circle's funding was used to improve the irrigation system, to purchase a personnel lift, a bench maker and other machinery and equipment related to food processing, and to purchase strawberry, honeysuckle and grape seedlings for a total of 17.678 euros. The remaining 5.042 euros was used to pay off some of the investment debt accrued in 2020 (a total of 16.120 euros) to member farmer Jukka Lassila.
The loan circle was established as short-term bridge financing before the cooperative could strengthen its own capital and reserves by issuing equity shares. The decision to carry out a share issue was made at the end of 2021. The share issue will reduce the cooperative's debt, as it will enable the reimbursement of the loan circle loans, or their conversion into equity shares.
Result for 2021
In 2021, Oma maa made a surplus of 117.679 euros, while the cooperative's result in 2020 was a deficit of EUR 23,131. The surplus was caused by the cancellation of one long-term loan of 156.253 euros, which was registered under other profits.
In 2021, Oma maa’s net sales were 130.945 euros, which represents a decrease from net sales in 2020 (142.975 euros). A total of 158.426 euros was recorded as other income in 2021, compared to only 13.770 euros in 2020.
The cooperative's costs consist of production fees paid to farmers, purchases for the farm, personnel costs for three workers, depreciation, and rent for two premises and other costs. In 2021, purchases decreased from 78.159 euros to 66.980 euros. There were no major changes in personnel costs and a total of 36.040 euros was spent on them in 2021.
Table 1. Oma maa’s income and expenditures 2019–2021.
Assets on December 31, 2021
On December 31, 2021, Oma maa’s assets totaled 35.724 euros. The assets consist of 14.769 euros worth of agricultural machinery and irrigation system, 14.967 euros worth of receivables, and a total of 5.987 euros worth of cash in hand and at banks.
Table 2. Oma maa’s assets 2019—2021.
Liabilities on December 31, 2021
On December 31, 2021, Oma maa had a total of 7.860 euros in long term debts (a loan period of more than one year) to the cooperative's members.
Short term debts consisted of accounts payable 66.582 euros, other liabilities 26.248 euros, and accrued liabilities 2.580 euros. Most of the accounts payable (60.706 euros) were owed to members of the cooperative. Most of the other liabilities (22.760 euros) were loans from the loan circle created in the spring of 2021 to fund investments. Accrued liabilities were accruals for pensions and other employee contributions related to personnel expenses.
Table 3. Oma maa’s capital and reserves, and creditors 2019–2021.