Filed pursuant to Rule 424(b)(3)
File No. 333-17865
Supplement dated April 15, 1997, to Prospectus dated February 14, 1997
HARVEST STATES COOPERATIVES AND SUBSIDIARIES
RESULTS OF OPERATIONS FOR THE NINE MONTHS ENDED FEBRUARY 28, 1997
Results of operations of the Company for the nine months ended February 28,
1996 and 1997 are set forth below:
NINE MONTHS ENDED
FEBRUARY 28,
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1996 1997
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Revenues
Sales $6,045,728,087 $5,611,898,277
Patronage dividends 6,815,690 7,789,427
Other revenues 55,100,245 53,901,006
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6,107,644,022 5,673,588,710
Costs and Expenses 6,061,539,481 5,631,670,026
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Earnings Before Income Taxes 46,104,541 41,918,684
Income Taxes 5,700,000 4,950,000
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Net Earnings $ 40,404,451 $ 36,968,684
============== ==============
The decline in revenues and net earnings was primarily due to decreased
volumes of grains sold. A decline in sales prices was offset by a similar
decline in purchase prices.
Results of operations of the Processing and Refining Division for the nine
months ended February 28, 1996 and 1997 are set forth below:
NINE MONTHS ENDED
FEBRUARY 28,
----------------------------
1996 1997
------------ ------------
Sales $294,784,442 $327,115,654
Costs and Expenses 276,860,915 306,450,809
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Earnings Before Income Taxes 17,923,527 20,664,845
Income Taxes 1,775,000 2,050,000
------------ ------------
Net Earnings $ 16,148,527 $ 18,614,845
============ ============
Bushels Processed 23,090,492 24,010,420
Earnings per Bushel .56 .61
The increase in sales, net earnings and net earnings per bushel was
primarily due to higher processing margins for soybean oil and increased volumes
of soybeans crushed and oil refined.
PRO FORMA INFORMATION (SEE PAGE 25 OF THE PROSPECTUS, INCLUDING NOTE (2))
NINE MONTHS ENDED
FEBRUARY 28, 1997
-----------------
Equity Participation Units
(bushels) 12,005,210
Patronage rate 0.61
-----------
Earnings to holders $ 7,323,178
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Results of operations of the Milling Division for the nine months ended
February 28, 1996 and 1997 are set forth below:
NINE MONTHS ENDED
FEBRUARY 28
----------------------------
1996 1997
------------ ------------
Sales $119,349,973 $160,305,189
Costs and Expenses 117,257,452 155,187,957
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Earnings Before Income Taxes 2,092,521 5,117,232
Income Taxes 200,000 400,000
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Net Earnings $ 1,892,521 $ 4,717,232
============ ============
Bushels Processed 15,447,228 21,965,810
Earnings per Bushel .14 .23
The increase in revenues and net earnings was primarily due to increased
volumes of grain milled.
PRO FORMA INFORMATION (SEE PAGE 34 OF THE PROSPECTUS, INCLUDING NOTE (2))
NINE MONTHS ENDED
FEBRUARY 28, 1997
-----------------
Equity Participation Units
(bushels) 10,982,905
Patronage rate .23
-----------
Earnings to holders $ 2,526,068
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MILLING DIVISION
In March 1997, it was reported that Borden (which represented 23.8% of the
Milling Division's semolina and durum flour sales in the year ended May 31,
1996) was closing five of its ten North American pasta manufacturing plants.
Four of the plants to be closed are customers of the Milling Division. For the
years ended May 31, 1995 and 1996, shipments to those four plants were 16% and
22%, respectively, of total semolina and durum flour shipments and for the nine
months ended February 28, 1997, were 22% of the total semolina and durum flour
shipments. Borden has stated that it has received offers for several of the
plants, which it is in the process of reviewing. Because overall domestic demand
for pasta remains strong and durum milling capacity is fixed, the Company
believes that sales made to these closed plants can be replaced by sales to the
purchaser or purchasers of one or more of the closed plants, should Borden
determine to sell such plants, increased sales to Borden's remaining plants or
increased sales to other large pasta manufacturers (either current or new
customers of the Milling Division). Alternatively, excess durum milling capacity
could be converted to other types of wheat milling, such as specialty or blended
flours or bakery flour. A substantial portion (31.5% in the year ended May 31,
1996) of the production of the Company's Rush City facility is sold to one of
the plants to be closed. Because there are no other pasta manufacturing plants
located in geographical proximity to Rush City, the Company could be forced to
close that facility and possibly to relocate its machinery to a different
location.
The Company is unable to predict the effect of any disruption in sales
because of the closing of the plants, including a temporary disruption while the
Company locates alternative customers.
