##### Table of Contents



UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 Form 10-Q
  þ
    
    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 For the quarterly period ended March 31, 2009
 or
 o
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 For the transition period from          to          .
 Commission file number 333-84486
 Land OLakes, Inc.
 (Exact name of Registrant as Specified in Its Charter)
 Minnesota(State or Other Jurisdiction of 
Incorporation or Organization)
    
    41-0365145(I.R.S. Employer
Identification No.)4001 Lexington Avenue NorthArden Hills, Minnesota(Address of Principal Executive Offices)
    
    55112(Zip Code)
 (651) 481-2222  (Registrants Telephone Number, Including Area Code)
 o þ
 o o
  Large accelerated filer o
    
    Accelerated filer o
    
    Non-accelerated filer þ
    
    Smaller reporting company o(Do not check if a smaller reporting company)
 o þ
    www.landolakesinc.com




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##### 



INDEX
 PagePart I. Financial Information
    
    3Item I. Financial Statements
    
    3Consolidated Balance Sheets as of March 31, 2009 (unaudited) and December 31, 2008
    
    3Consolidated Statements of Operations for the three months ended March 31, 2009 and 2008 (unaudited)
    
    4Consolidated Statements of Cash Flows for the three months ended March 31, 2009 and 2008 (unaudited)
    
    5Notes to Consolidated Financial Statements (unaudited)
    
    6Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations
    
    26Item 3. Quantitative and Qualitative Disclosures about Market Risk
    
    39Item 4. Controls and Procedures
    
    40Part II Other Information
    
    41Item 1. Legal Proceedings
    
    41Item 1A. Risk Factors
    
    42Item 6. Exhibits
    
    43SIGNATURES
    
    44EX-31.1EX-31.2EX-32.1EX-32.2
  2




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##### Table of Contents



Part I. Financial Information
 
 Item 1. Financial Statements
 LAND OLAKES, INC.
 
 CONSOLIDATED BALANCE SHEETS
 March 31,
    
    
    December 31,2009
    
    
    2008(Unaudited)($ in thousands)ASSETSCurrent assets:Cash and cash equivalents
    
    $
    33,490
    
    
    $
    30,820Receivables, net
    
    
    1,445,692
    
    
    
    1,104,261Inventories
    
    
    1,227,786
    
    
    
    1,083,978Prepaid assets
    
    
    222,862
    
    
    
    1,101,005Other current assets
    
    
    90,658
    
    
    
    123,504Total current assets
    
    
    3,020,488
    
    
    
    3,443,568Investments
    
    
    301,526
    
    
    
    314,487Property, plant and equipment, net
    
    
    672,794
    
    
    
    658,261Goodwill, net
    
    
    277,383
    
    
    
    277,176Other intangibles, net
    
    
    118,999
    
    
    
    120,982Other assets
    
    
    165,388
    
    
    
    166,838Total assets
    
    $
    4,556,578
    
    
    $
    4,981,312LIABILITIES AND EQUITIESCurrent liabilities:Notes and short-term obligations
    
    $
    617,551
    
    
    $
    409,370Current portion of long-term debt
    
    
    2,568
    
    
    
    2,864Accounts payable
    
    
    1,062,973
    
    
    
    1,175,995Customer advances
    
    
    421,634
    
    
    
    1,045,705Accrued liabilities
    
    
    449,313
    
    
    
    423,494Patronage refunds and other member equities payable
    
    
    60,118
    
    
    
    37,751Total current liabilities
    
    
    2,614,157
    
    
    
    3,095,179Long-term debt
    
    
    531,800
    
    
    
    531,955Employee benefits and other liabilities
    
    
    379,304
    
    
    
    358,404Commitments and contingencies (Note 17)Equities:Capital stock
    
    
    1,597
    
    
    
    1,611Member equities
    
    
    970,293
    
    
    
    947,141Accumulated other comprehensive loss
    
    
    (151,609
    )
    
    
    (150,277
    )Retained earnings
    
    
    196,740
    
    
    
    178,377Total Land OLakes, Inc. equity
    
    
    1,017,021
    
    
    
    976,852Noncontrolling interests
    
    
    14,296
    
    
    
    18,922Total equities
    
    
    1,031,317
    
    
    
    995,774Total liabilities and equities
    
    $
    4,556,578
    
    
    $
    4,981,312
  3




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##### Table of Contents



LAND OLAKES, INC.
 
 CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
 For the Three Months EndedMarch 31,2009
    
    
    2008($ in thousands)Net sales
    
    $
    2,947,314
    
    
    $
    3,256,999Cost of sales
    
    
    2,687,270
    
    
    
    3,006,292Gross profit
    
    
    260,044
    
    
    
    250,707Selling, general and administrative
    
    
    163,273
    
    
    
    167,579Restructuring and impairment charges
    
    
    297
    
    
    
    53Earnings from operations
    
    
    96,474
    
    
    
    83,075Interest expense, net
    
    
    13,198
    
    
    
    17,135Other (income) expense, net
    
    
    (2,387
    )
    
    
    12Equity in losses (earnings) of affiliated companies
    
    
    7,164
    
    
    
    (4,102
    )Earnings before income taxes
    
    
    78,499
    
    
    
    70,030Income tax (benefit) expense
    
    
    (1,225
    )
    
    
    6,922Net earnings
    
    
    79,724
    
    
    
    63,108Less: net (loss) earnings attributable to noncontrolling interests
    
    
    (2,966
    )
    
    
    1,825Net earnings attributable to Land OLakes, Inc.
    
    $
    82,690
    
    
    $
    61,283Applied to:Member equitiesAllocated patronage
    
    $
    77,673
    
    
    $
    47,841Deferred equities
    
    
    (13,159
    )
    
    
    (4,963
    )64,514
    
    
    
    42,878Retained earnings
    
    
    18,176
    
    
    
    18,405$
    82,690
    
    
    $
    61,283
  4




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##### Table of Contents



LAND OLAKES, INC.
 
 CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
 For the Three Months EndedMarch 31,2009
    
    
    2008($ in thousands)Cash flows from operating activities:Net earnings attributable to Land OLakes, Inc.
    
    $
    82,690
    
    
    $
    61,283Adjustments to reconcile net earnings attributable to Land OLakes, Inc. to net
cash used by operating activities:Depreciation and amortization
    
    
    21,095
    
    
    
    22,146Amortization of deferred financing costs
    
    
    601
    
    
    
    525Bad debt (recovery) expense
    
    
    (944
    )
    
    
    986Proceeds from patronage revolvement received
    
    
    119
    
    
    
    1,560Non-cash patronage income
    
    
    (225
    )
    
    
    (1,331
    )Deferred income tax benefit
    
    
    (2,819
    )
    
    
    (14,631
    )Increase in other assets
    
    
    (1,279
    )
    
    
    (948
    )Increase in other liabilities
    
    
    8,806
    
    
    
    5,725Restructuring and impairment charges
    
    
    297
    
    
    
    53(Gain) loss on sale of investment
    
    
    (2,210
    )
    
    
    12Gain on foreign currency exchange contracts on sale of investment
    
    
    (177
    )
    
    
    Equity in losses (earnings) of affiliated companies
    
    
    7,164
    
    
    
    (4,102
    )Dividends from investments in affiliated companies
    
    
    5,258
    
    
    
    5,448Net (loss) earnings attributable to noncontrolling interests
    
    
    (2,966
    )
    
    
    1,825Other
    
    
    (3,449
    )
    
    
    (194
    )Changes in current assets and liabilities, net of acquisitions and divestitures:Receivables
    
    
    (352,074
    )
    
    
    (450,627
    )Inventories
    
    
    (143,808
    )
    
    
    (112,649
    )Prepaids and other current assets
    
    
    918,017
    
    
    
    354,880Accounts payable
    
    
    (112,173
    )
    
    
    205,268Customer advances
    
    
    (624,071
    )
    
    
    (429,128
    )Accrued liabilities
    
    
    43,299
    
    
    
    91,283Net cash used by operating activities
    
    
    (158,849
    )
    
    
    (262,616
    )Cash flows from investing activities:Additions to property, plant and equipment
    
    
    (36,925
    )
    
    
    (24,316
    )Acquisitions, net of cash acquired
    
    
    
    
    
    
    (6,419
    )Investments in affiliates
    
    
    (415
    )
    
    
    (50,835
    )Distributions from investments in affiliated companies
    
    
    
    
    
    
    4,448Proceeds from sale of investments
    
    
    5,568
    
    
    
    49Proceeds from foreign currency exchange contracts on sale of investment
    
    
    518
    
    
    
    Proceeds from sale of property, plant and equipment
    
    
    842
    
    
    
    66Insurance proceeds for replacement assets
    
    
    4,415
    
    
    
    Change in notes receivable
    
    
    262
    
    
    
    (6,038
    )Other
    
    
    248
    
    
    
    (476
    )Net cash used by investing activities
    
    
    (25,487
    )
    
    
    (83,521
    )Cash flows from financing activities:Increase in short-term debt
    
    
    208,181
    
    
    
    341,931Proceeds from issuance of long-term debt
    
    
    10
    
    
    
    666Principal payments on long-term debt and capital lease obligations
    
    
    (656
    )
    
    
    (12,693
    )Payments for redemption of member equities
    
    
    (18,853
    )
    
    
    (22,161
    )Other
    
    
    (1,676
    )
    
    
    (36
    )Net cash provided by financing activities
    
    
    187,006
    
    
    
    307,707Net increase (decrease) in cash and cash equivalents
    
    
    2,670
    
    
    
    (38,430
    )Cash and cash equivalents at beginning of the period
    
    
    30,820
    
    
    
    116,839Cash and cash equivalents at end of the period
    
    $
    33,490
    
    
    $
    78,409Supplementary Disclosure of Cash Flow InformationCash paid (received) during periods for:Interest
    
    $
    10,715
    
    
    $
    13,691Income taxes
    
    
    (15,749
    )
    
    
    3,170
  5




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LAND OLAKES, INC.
 
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
($ in thousands in tables)
(Unaudited)
 1. Summary of Significant Accounting Policies
   Recent Accounting Pronouncements
      6




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Accounting Estimates
  7




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##### Table of Contents



2. Business Combinations
 2009 Acquisitions
  2008 Acquisitions
  3. Receivables
  March 31,
    
    
    December 31,2009
    
    
    2008Trade accounts
    
    $
    1,072,885
    
    
    $
    846,794Notes and contracts
    
    
    87,886
    
    
    
    89,736Vendor rebates
    
    
    168,022
    
    
    
    57,007Other
    
    
    136,568
    
    
    
    130,5911,465,361
    
    
    
    1,124,128Less allowance for doubtful accounts
    
    
    (19,669
    )
    
    
    (19,867
    )Total receivables, net
    
    $
    1,445,692
    
    
    $
    1,104,261
     4. Inventories
  March 31,
    
    
    December 31,2009
    
    
    2008Raw materials
    
    $
    212,251
    
    
    $
    217,087Work in process
    
    
    2,139
    
    
    
    1,639Finished goods
    
    
    1,013,396
    
    
    
    865,252Total inventories
    
    $
    1,227,786
    
    
    $
    1,083,978
 8




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5. Investments
  March 31,
    
    
    December 31,2009
    
    
    2008Agriliance LLC
    
    $
    164,500
    
    
    $
    176,191Advanced Food Products, LLC
    
    
    31,842
    
    
    
    33,870Ag Processing Inc.
    
    
    31,072
    
    
    
    31,858Delta Egg Farm, LLC
    
    
    11,878
    
    
    
    11,464Melrose Dairy Proteins, LLC
    
    
    8,404
    
    
    
    6,397Universal Cooperatives, Inc.
    
    
    7,897
    
    
    
    7,877CoBank, ACB
    
    
    5,345
    
    
    
    4,892Pro-Pet, LLC
    
    
    3,033
    
    
    
    2,123Prairie Farms Dairy, Inc.
    
    
    2,922
    
    
    
    2,954Wilco-Winfield, LLC
    
    
    2,373
    
    
    
    3,131Other  principally cooperatives and joint ventures
    
    
    32,260
    
    
    
    33,730Total investments
    
    $
    301,526
    
    
    $
    314,487
   6. Goodwill and Other Intangible Assets
 Goodwill
  March 31,
    
    
    December 31,2009
    
    
    2008Feed
    
    $
    126,960
    
    
    $
    126,960Dairy Foods
    
    
    68,525
    
    
    
    68,525Agronomy
    
    
    50,663
    
    
    
    50,663Layers
    
    
    20,553
    
    
    
    20,346Seed
    
    
    10,682
    
    
    
    10,682Total goodwill
    
    $
    277,383
    
    
    $
    277,176
  9




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Other Intangible Assets
  March 31,
    
    
    December 31,2009
    
    
    2008Amortized other intangible assets:Dealer networks and customer relationships, less accumulated amortization of $4,660 and
$4,045, respectively
    
    $
    49,861
    
    
    $
    50,478Patents, less accumulated amortization of $8,704 and $8,414, respectively
    
    
    8,007
    
    
    
    8,297Trademarks, less accumulated amortization of $2,842 and $2,668, respectively
    
    
    4,773
    
    
    
    4,946Other intangible assets, less accumulated amortization of $3,802 and $4,412, respectively
    
    
    4,733
    
    
    
    5,636Total amortized other intangible assets
    
    
    67,374
    
    
    
    69,357Total non-amortized other intangible assets  trademarks and license agreements
    
    
    51,625
    
    
    
    51,625Total other intangible assets
    
    $
    118,999
    
    
    $
    120,982
  7. Accrued Liabilities
  March 31,
    
    
    December 31,2009
    
    
    2008Marketing programs and consumer incentives
    
    $
    183,668
    
    
    $
    70,209Employee compensation and benefits
    
    
    88,379
    
    
    
    141,376Unrealized hedging losses and deferred option premiums received
    
    
    65,757
    
    
    
    99,964Other
    
    
    111,509
    
    
    
    111,945Total accrued liabilities
    
    $
    449,313
    
    
    $
    423,494
  8. Debt Obligations
 Notes and Short-term Obligations
    10




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Long-term Debt
  March 31,
    
    
    December 31,2009
    
    
    2008Senior unsecured notes  due 2011 (8.75%)
    
    $
    174,002
    
    
    $
    174,002Senior secured notes  due 2010 (9.00%)
    
    
    149,700
    
    
    
    149,700Capital Securities of Trust Subsidiary  due 2028 (7.45%)
    
    
    190,700
    
    
    
    190,700MoArk, LLC debt  due 2009 through 2023 (8.65% weighted average)
    
    
    15,232
    
    
    
    15,449MoArk, LLC capital lease obligations (6.00% to 8.25%)
    
    
    4,346
    
    
    
    4,668Other debt
    
    
    388
    
    
    
    300534,368
    
    
    
    534,819Less current portion
    
    
    (2,568
    )
    
    
    (2,864
    )Total long-term debt
    
    $
    531,800
    
    
    $
    531,955
   11




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9. Other Comprehensive Income
  Three Months EndedMarch 31,2009
    
    
    2008Net earnings attributable to Land OLakes, Inc.
    
    $
    82,690
    
    
    $
    61,283Pension and other postretirement adjustments, net of income taxes of $813 and $(61),
respectively
    
    
    (1,312
    )
    
    
    99Foreign currency translation adjustment, net of income taxes of $7 and $(1,940), respectively
    
    
    (12
    )
    
    
    2,948Unrealized loss on available-for-sale-investment securities, net of income taxes of $5 and
$(61), respectively
    
    
    (16
    )
    
    
    (255
    )Less: Other comprehensive loss attributable to noncontrolling interests
    
    
    8
    
    
    
    79Total comprehensive income
    
    $
    81,358
    
    
    $
    64,154
 10. Derivative Instruments
     Three Months EndedMarch 31,Derivative Instrument
    
    Location
    
    2009Commodity derivatives
    
    Cost of sales
    
    $
    2,551Commodity derivatives
    
    Selling, general and administrative
    
    
    (364
    )Foreign currency exchange contracts
    
    Cost of sales
    
    
    (26
    )Foreign currency exchange contracts
    
    Other (income) expense, net
    
    
    341
  LiabilityAsset Derivatives(a)
    
    
    Derivatives(a)March 31,
    
    
    March 31,Derivative Instrument
    
    2009
    
    
    2009Commodity derivatives
    
    $
    21,761
    
    
    $
    59,187Foreign currency exchange contracts
    
    
    
    
    
    
    899Total
    
    $
    21,761
    
    
    $
    60,086
 
 (a)
    
    Asset derivative instruments are recorded in other current
assets and liability derivative instruments are recorded in
accrued liabilities in the consolidated balance sheet.  12




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11. Fair Value Measurement
    Level 1:
 Level 2:
 Level 3:
  Fair Value Measurements at March 31, 2009 Using:SignificantQuoted prices
    
    other
    
    SignificantTotal carrying
    
    in active
    
    observable
    
    unobservablevalue at
    
    markets
    
    inputs
    
    inputsMarch 31, 2009(a)
    
    (Level 1)
    
    (Level 2)
    
    (Level 3)Commodity derivative assets
    
    $
    21,761
    
    
    $
    20,990
    
    
    $
    771
    
    
    $
    Commodity derivative liabilities
    
    
    59,187
    
    
    
    59,174
    
    
    
    13
    
    
    
    Foreign currency exchange contract liabilities
    
    
    899
    
    
    
    
    
    
    
    899
    
    
    
    Available-for-sale securities
    
    
    24
    
    
    
    24
    
    
    
    
    
    
    
    
 Fair Value Measurements at December 31, 2008 Using:SignificantQuoted prices
    
    other
    
    SignificantTotal carrying
    
    in active
    
    observable
    
    unobservablevalue at
    
    markets
    
    inputs
    
    inputsDecember 31, 2008(a)
    
    (Level 1)
    
    (Level 2)
    
    (Level 3)Commodity derivative assets
    
    $
    50,053
    
    
    $
    49,139
    
    
    $
    914
    
    
    $
    Commodity derivative liabilities
    
    
    85,292
    
    
    
    85,128
    
    
    
    164
    
    
    
    Foreign currency exchange contract assets
    
    
    341
    
    
    
    
    
    
    
    341
    
    
    
    Foreign currency exchange contract liabilities
    
    
    925
    
    
    
    
    
    
    
    925
    
    
    
    Available-for-sale securities
    
    
    47
    
    
    
    47
    
    
    
    
    
    
    
    
 
 (a)
    
    FASB Staff Position No. FIN 39-1, Amendment of FASB Interpretation No.
39 (FIN 39-1) permits, but does not require companies that enter into master netting
arrangements to offset fair value amounts recognized for derivative instruments against the
right to reclaim cash collateral or the obligation to return cash collateral. The Company has
master netting arrangements with brokers for its exchange-traded futures and options
contracts, however, it does not elect to offset fair value amounts recognized for derivative
instruments under such master netting arrangements with amounts recognized for margin balances
due from or due to brokers. 13




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12. Income Taxes
  13. Pension and Other Postretirement Plans
  Other PostretirementPension Benefits
    
    
    Benefits2009
    
    
    2008
    
    
    2009
    
    
    2008Service cost
    
    $
    3,334
    
    
    $
    3,810
    
    
    $
    128
    
    
    $
    196Interest cost
    
    
    9,474
    
    
    
    9,678
    
    
    
    907
    
    
    
    1,071Expected return on assets
    
    
    (10,433
    )
    
    
    (11,000
    )
    
    
    
    
    
    
    Amortization of actuarial loss
    
    
    1,317
    
    
    
    1,290
    
    
    
    184
    
    
    
    489Amortization of prior service cost
    
    
    (110
    )
    
    
    (132
    )
    
    
    
    
    
    
    Amortization of transition obligation
    
    
    
    
    
    
    
    
    
    
    107
    
    
    
    116Net periodic benefit cost
    
    $
    3,582
    
    
    $
    3,646
    
    
    $
    1,326
    
    
    $
    1,872
   14. Restructuring and Impairment Charges
  Three Months EndedMarch 31,2009
    
    
    2008Restructuring charges
    
    $
    297
    
    
    $
    53Impairment charges
    
    
    
    
    
    
    Total restructuring and impairment charges
    
    $
    297
    
    
    $
    53
 Restructuring Charges
   14




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15. Other (Income) Expense, Net
 Three Months EndedMarch 31,2009
    
    
    2008(Gain) loss on sale of investments
    
    $
    (2,210
    )
    
    $
    12Gain on foreign currency exchange contracts on sale of investment
    
    
    (177
    )
    
    
    Total other (income) expense, net
    
    $
    (2,387
    )
    
    $
    12
     16. Insurance Proceeds
  17. Commitments and Contingencies
 ® ® ® ® ®
 15




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16




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18. Subsequent Event
    19. Segment Information
  LAND
O LAKES Indian Maiden Alpine Lace New
Yorker
       17




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Other/Dairy Foods
    
    
    Feed
    
    
    Seed
    
    
    Agronomy
    
    
    Layers
    
    
    Eliminations
    
    
    ConsolidatedFor the three months ended March 31, 2009:Net sales (1)
    
    $
    753,238
    
    
    $
    893,752
    
    
    $
    775,142
    
    
    $
    408,417
    
    
    $
    138,227
    
    
    $
    (21,462
    )
    
    $
    2,947,314Cost of sales (2)
    
    
    722,106
    
    
    
    821,399
    
    
    
    663,786
    
    
    
    375,243
    
    
    
    126,690
    
    
    
    (21,954
    )
    
    
    2,687,270Selling, general and administrative
    
    
    49,629
    
    
    
    62,311
    
    
    
    22,570
    
    
    
    21,812
    
    
    
    5,999
    
    
    
    952
    
    
    
    163,273Restructuring and impairment charges
    
    
    
    
    
    
    297
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    297Interest expense (income), net
    
    
    1,961
    
    
    
    6,426
    
    
    
    2,272
    
    
    
    1,763
    
    
    
    2,382
    
    
    
    (1,606
    )
    
    
    13,198Other expense (income), net
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    4,060
    
    
    
    (6,447
    )
    
    
    
    
    
    
    (2,387
    )Equity in (earnings) losses of affiliated companies
    
    
    (2,572
    )
    
    
    (1,988
    )
    
    
    
    
    
    
    13,292
    
    
    
    (1,568
    )
    
    
    
    
    
    
    7,164(Loss) earnings before income taxes
    
    $
    (17,886
    )
    
    $
    5,307
    
    
    $
    86,514
    
    
    $
    (7,753
    )
    
    $
    11,171
    
    
    $
    1,146
    
    
    $
    78,499
 Other/Dairy Foods
    
    
    Feed
    
    
    Seed
    
    
    Agronomy
    
    
    Layers
    
    
    Eliminations
    
    
    ConsolidatedFor the three months ended March 31, 2008:Net sales (1)
    
    $
    1,048,059
    
    
    $
    941,732
    
    
    $
    627,117
    
    
    $
    487,151
    
    
    $
    181,142
    
    
    $
    (28,202
    )
    
    $
    3,256,999Cost of sales (2)
    
    
    1,006,222
    
    
    
    861,641
    
    
    
    560,681
    
    
    
    457,840
    
    
    
    147,291
    
    
    
    (27,383
    )
    
    
    3,006,292Selling, general and administrative
    
    
    46,951
    
    
    
    63,392
    
    
    
    22,712
    
    
    
    24,577
    
    
    
    8,997
    
    
    
    950
    
    
    
    167,579Restructuring and impairment charges
    
    
    53
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    53Interest expense (income), net
    
    
    2,540
    
    
    
    7,184
    
    
    
    692
    
    
    
    4,499
    
    
    
    3,600
    
    
    
    (1,380
    )
    
    
    17,135Other expense, net
    
    
    
    
    
    
    12
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    12Equity in (earnings) losses of affiliated companies
    
    
    (2,598
    )
    
    
    119
    
    
    
    
    
    
    
    9,471
    
    
    
    (11,094
    )
    
    
    
    
    
    
    (4,102
    )(Loss) earnings before income taxes
    
    $
    (5,109
    )
    
    $
    9,384
    
    
    $
    43,032
    
    
    $
    (9,236
    )
    
    $
    32,348
    
    
    $
    (389
    )
    
    $
    70,030
 Other/Dairy Foods
    
    Feed
    
    Seed
    
    Agronomy
    
    Layers
    
    Eliminations
    
    Consolidated(1) Net sales includes intersegment sales of:2009
    
    $
    1,707
    
    
    $
    9,149
    
    
    $
    9,529
    
    
    $
    1,934
    
    
    $
    
    
    
    $
    (22,319
    )
    
    $
    2008
    
    
    2,158
    
    
    
    10,745
    
    
    
    8,926
    
    
    
    9,656
    
    
    
    
    
    
    
    (31,485
    )
    
    
    (2) Cost of sales includes period-to-period
change in unrealized hedging (gains) losses
of:2009
    
    $
    2,023
    
    
    $
    (5,577
    )
    
    $
    (1,704
    )
    
    $
    (127
    )
    
    $
    (115
    )
    
    $
    8,025
    
    
    $
    2,5252008
    
    
    (1,670
    )
    
    
    14,508
    
    
    
    6,338
    
    
    
    
    
    
    
    7,755
    
    
    
    1,010
    
    
    
    27,941
 18




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##### Table of Contents



20. Consolidating Financial Information
    19




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##### Table of Contents



LAND OLAKES, INC.
 SUPPLEMENTAL CONSOLIDATING BALANCE SHEET
March 31, 2009
 LandOLakes, Inc.
    
    
    
    
    
    
    Non-Parent
    
    
    Consolidated
    
    
    GuarantorCompany
    
    
    Guarantors
    
    
    Subsidiaries
    
    
    Eliminations
    
    
    ConsolidatedASSETSCurrent assets:Cash and cash equivalents
    
    $
    9,451
    
    
    $
    29
    
    
    $
    24,010
    
    
    $
    
    
    
    $
    33,490Receivables, net
    
    
    391,645
    
    
    
    568,167
    
    
    
    1,124,660
    
    
    
    (638,780
    )
    
    
    1,445,692Intercompany receivables, net
    
    
    85,194
    
    
    
    53,567
    
    
    
    1,240
    
    
    
    (140,001
    )
    
    
    Inventories
    
    
    373,429
    
    
    
    759,408
    
    
    
    94,949
    
    
    
    
    
    
    
    1,227,786Prepaid assets
    
    
    111,835
    
    
    
    108,328
    
    
    
    2,699
    
    
    
    
    
    
    
    222,862Other current assets
    
    
    77,509
    
    
    
    10,929
    
    
    
    2,220
    
    
    
    
    
    
    
    90,658Total current assets
    
    
    1,049,063
    
    
    
    1,500,428
    
    
    
    1,249,778
    
    
    
    (778,781
    )
    
    
    3,020,488Investments
    
    
    1,083,610
    
    
    
    54,850
    
    
    
    16,126
    
    
    
    (853,060
    )
    
    
    301,526Property, plant and equipment, net
    
    
    267,477
    
    
    
    292,002
    
    
    
    113,315
    
    
    
    
    
    
    
    672,794Goodwill, net
    
    
    191,935
    
    
    
    64,532
    
    
    
    20,916
    
    
    
    
    
    
    
    277,383Other intangibles, net
    
    
    1,607
    
    
    
    110,504
    
    
    
    6,888
    
    
    
    
    
    
    
    118,999Other assets
    
    
    67,621
    
    
    
    41,506
    
    
    
    60,159
    
    
    
    (3,898
    )
    
    
    165,388Total assets
    
    $
    2,661,313
    
    
    $
    2,063,822
    
    
    $
    1,467,182
    
    
    $
    (1,635,739
    )
    
    $
    4,556,578LIABILITIES AND EQUITIESCurrent liabilities:Notes and short-term obligations
    
    $
    113,000
    
    
    $
    2,377
    
    
    $
    1,121,876
    
    
    $
    (619,702
    )
    
    $
    617,551Current portion of long-term debt
    
    
    15
    
    
    
    50
    
    
    
    2,503
    
    
    
    
    
    
    
    2,568Accounts payable
    
    
    304,683
    
    
    
    744,471
    
    
    
    35,866
    
    
    
    (22,047
    )
    
    
    1,062,973Intercompany payable, net
    
    
    
    
    
    
    149,580
    
    
    
    (9,579
    )
    
    
    (140,001
    )
    
    
    Customer advances
    
    
    96,183
    
    
    
    321,202
    
    
    
    4,249
    
    
    
    
    
    
    
    421,634Accrued liabilities
    
    
    212,489
    
    
    
    206,806
    
    
    
    30,947
    
    
    
    (929
    )
    
    
    449,313Patronage refunds and other member equities
payable
    
    
    60,118
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    60,118Total current liabilities
    
    
    786,488
    
    
    
    1,424,486
    
    
    
    1,185,862
    
    
    
    (782,679
    )
    
    
    2,614,157Long-term debt
    
    
    513,190
    
    
    
    58
    
    
    
    18,552
    
    
    
    
    
    
    
    531,800Employee benefits and other liabilities
    
    
    344,614
    
    
    
    29,061
    
    
    
    5,629
    
    
    
    
    
    
    
    379,304Commitments and contingenciesEquities:Capital stock
    
    
    1,597
    
    
    
    (34
    )
    
    
    2,935
    
    
    
    (2,901
    )
    
    
    1,597Additional paid-in capital
    
    
    
    
    
    
    200,993
    
    
    
    73,677
    
    
    
    (274,670
    )
    
    
    Member equities
    
    
    970,293
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    970,293Accumulated other comprehensive loss
    
    
    (151,609
    )
    
    
    (1
    )
    
    
    (55
    )
    
    
    56
    
    
    
    (151,609
    )Retained earnings
    
    
    196,740
    
    
    
    409,259
    
    
    
    166,286
    
    
    
    (575,545
    )
    
    
    196,740Total Land OLakes, Inc. equities
    
    
    1,017,021
    
    
    
    610,217
    
    
    
    242,843
    
    
    
    (853,060
    )
    
    
    1,017,021Noncontrolling interests
    
    
    
    
    
    
    
    
    
    
    14,296
    
    
    
    
    
    
    
    14,296Total equities
    
    
    1,017,021
    
    
    
    610,217
    
    
    
    257,139
    
    
    
    (853,060
    )
    
    
    1,031,317Total liabilities and equities
    
    $
    2,661,313
    
    
    $
    2,063,822
    
    
    $
    1,467,182
    
    
    $
    (1,635,739
    )
    
    $
    4,556,578
 20




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##### Table of Contents



LAND OLAKES, INC.
 SUPPLEMENTAL CONSOLIDATING STATEMENT OF OPERATIONS
For the Three Months Ended March 31, 2009
 LandOLakes, Inc.Parent
    
    
    Consolidated
    
    
    Non-GuarantorCompany
    
    
    Guarantors
    
    
    Subsidiaries
    
    
    Eliminations
    
    
    ConsolidatedNet sales
    
    $
    1,494,323
    
    
    $
    1,273,687
    
    
    $
    179,304
    
    
    $
    
    
    
    $
    2,947,314Cost of sales
    
    
    1,351,406
    
    
    
    1,167,679
    
    
    
    168,185
    
    
    
    
    
    
    
    2,687,270Gross profit
    
    
    142,917
    
    
    
    106,008
    
    
    
    11,119
    
    
    
    
    
    
    
    260,044Selling, general and administrative
    
    
    74,021
    
    
    
    80,125
    
    
    
    9,127
    
    
    
    
    
    
    
    163,273Restructuring and impairment charges
    
    
    
    
    
    
    297
    
    
    
    
    
    
    
    
    
    
    
    297Earnings from operations
    
    
    68,896
    
    
    
    25,586
    
    
    
    1,992
    
    
    
    
    
    
    
    96,474Interest expense (income), net
    
    
    19,121
    
    
    
    (2,134
    )
    
    
    (3,789
    )
    
    
    
    
    
    
    13,198Other (income) expense, net
    
    
    (2,413
    )
    
    
    26
    
    
    
    
    
    
    
    
    
    
    
    (2,387
    )Equity in (earnings) losses of affiliated companies
    
    
    (27,753
    )
    
    
    (305
    )
    
    
    (1,568
    )
    
    
    36,790
    
    
    
    7,164Earnings before income taxes
    
    
    79,941
    
    
    
    27,999
    
    
    
    7,349
    
    
    
    (36,790
    )
    
    
    78,499Income tax (benefit) expense
    
    
    (2,749
    )
    
    
    562
    
    
    
    962
    
    
    
    
    
    
    
    (1,225
    )Net earnings
    
    
    82,690
    
    
    
    27,437
    
    
    
    6,387
    
    
    
    (36,790
    )
    
    
    79,724Less: net losses attributable to noncontrolling interests
    
    
    
    
    
    
    (42
    )
    
    
    (2,924
    )
    
    
    
    
    
    
    (2,966
    )Net earnings attributable to Land OLakes, Inc.
    
    $
    82,690
    
    
    $
    27,479
    
    
    $
    9,311
    
    
    $
    (36,790
    )
    
    $
    82,690
 21




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##### Table of Contents



LAND OLAKES, INC.
 SUPPLEMENTAL CONSOLIDATING STATEMENT OF CASH FLOWS
For the Three Months Ended March 31, 2009
 LandOLakes, Inc.Parent
    
    
    Consolidated
    
    
    Non-GuarantorCompany
    
    
    Guarantors
    
    
    Subsidiaries
    
    
    Eliminations
    
    
    ConsolidatedCash flows from operating activities:Net earnings attributable to Land OLakes, Inc.
    
    $
    82,690
    
    
    $
    27,479
    
    
    $
    9,311
    
    
    $
    (36,790
    )
    
    $
    82,690Adjustments to reconcile net earnings attributable to
Land OLakes, Inc. to net cash used by operating
activities:Depreciation and amortization
    
    
    9,339
    
    
    
    9,529
    
    
    
    2,227
    
    
    
    
    
    
    
    21,095Amortization of deferred financing costs
    
    
    402
    
    
    
    114
    
    
    
    85
    
    
    
    
    
    
    
    601Bad debt recovery
    
    
    (306
    )
    
    
    (297
    )
    
    
    (341
    )
    
    
    
    
    
    
    (944
    )Proceeds from patronage revolvement received
    
    
    89
    
    
    
    30
    
    
    
    
    
    
    
    
    
    
    
    119Non-cash patronage income
    
    
    (437
    )
    
    
    212
    
    
    
    
    
    
    
    
    
    
    
    (225
    )Deferred income tax benefit
    
    
    (2,819
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (2,819
    )Increase in other assets
    
    
    (218
    )
    
    
    (1,053
    )
    
    
    (22
    )
    
    
    14
    
    
    
    (1,279
    )Increase (decrease) in other liabilities
    
    
    8,918
    
    
    
    (103
    )
    
    
    (9
    )
    
    
    
    
    
    
    8,806Restructuring and impairment charges
    
    
    
    
    
    
    297
    
    
    
    
    
    
    
    
    
    
    
    297(Gain) loss on sale of investments
    
    
    (2,236
    )
    
    
    26
    
    
    
    
    
    
    
    
    
    
    
    (2,210
    )Gain on foreign currency exchange contracts on
sale of investment
    
    
    (177
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (177
    )Equity in (earnings) losses of affiliated companies
    
    
    (27,753
    )
    
    
    (305
    )
    
    
    (1,568
    )
    
    
    36,790
    
    
    
    7,164Dividends from investments in affiliated companies
    
    
    356
    
    
    
    2,000
    
    
    
    2,902
    
    
    
    
    
    
    
    5,258Net loss attributable to noncontrolling interests
    
    
    
    
    
    
    (42
    )
    
    
    (2,924
    )
    
    
    
    
    
    
    (2,966
    )Other
    
    
    (190
    )
    
    
    27
    
    
    
    (3,286
    )
    
    
    
    
    
    
    (3,449
    )Changes in current assets and liabilities, net of
acquisitions and divestitures:Receivables
    
    
    (116,343
    )
    
    
    (131,913
    )
    
    
    (194,542
    )
    
    
    90,724
    
    
    
    (352,074
    )Inventories
    
    
    3,721
    
    
    
    (152,643
    )
    
    
    5,114
    
    
    
    
    
    
    
    (143,808
    )Prepaids and other current assets
    
    
    609,205
    
    
    
    307,753
    
    
    
    1,059
    
    
    
    
    
    
    
    918,017Accounts payable
    
    
    (112,624
    )
    
    
    4,924
    
    
    
    (5,381
    )
    
    
    908
    
    
    
    (112,173
    )Customer advances
    
    
    (546,997
    )
    
    
    (80,215
    )
    
    
    3,141
    
    
    
    
    
    
    
    (624,071
    )Accrued liabilities
    
    
    44,735
    
    
    
    8,366
    
    
    
    (12,391
    )
    
    
    2,589
    
    
    
    43,299Net cash used by operating activities
    
    
    (50,645
    )
    
    
    (5,814
    )
    
    
    (196,625
    )
    
    
    94,235
    
    
    
    (158,849
    )Cash flows from investing activities:Additions to property, plant and equipment
    
    
    (24,222
    )
    
    
    (6,438
    )
    
    
    (6,265
    )
    
    
    
    
    
    
    (36,925
    )Investments in affiliates
    
    
    (75
    )
    
    
    (340
    )
    
    
    
    
    
    
    
    
    
    
    (415
    )Proceeds from sale of investments
    
    
    5,568
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    5,568Proceeds from foreign currency exchange contracts
on sale of investment
    
    
    518
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    518Proceeds from sale of property, plant and equipment
    
    
    6
    
    
    
    836
    
    
    
    
    
    
    
    
    
    
    
    842Insurance proceeds for replacement assets
    
    
    
    
    
    
    4,415
    
    
    
    
    
    
    
    
    
    
    
    4,415Change in notes receivable
    
    
    (742
    )
    
    
    (28
    )
    
    
    1,032
    
    
    
    
    
    
    
    262Other
    
    
    (2
    )
    
    
    250
    
    
    
    
    
    
    
    
    
    
    
    248Net cash used by investing activities
    
    
    (18,949
    )
    
    
    (1,305
    )
    
    
    (5,233
    )
    
    
    
    
    
    
    (25,487
    )Cash flows from financing activities:Increase in short-term debt
    
    
    93,002
    
    
    
    133
    
    
    
    209,281
    
    
    
    (94,235
    )
    
    
    208,181Proceeds from issuance of long-term debt
    
    
    
    
    
    
    10
    
    
    
    
    
    
    
    
    
    
    
    10Principal payments on long-term debt and capital
lease obligations
    
    
    (7
    )
    
    
    (16
    )
    
    
    (633
    )
    
    
    
    
    
    
    (656
    )Payments for redemption of member equities
    
    
    (18,853
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (18,853
    )Other
    
    
    (82
    )
    
    
    (7
    )
    
    
    (1,587
    )
    
    
    
    
    
    
    (1,676
    )Net cash provided by financing activities
    
    
    74,060
    
    
    
    120
    
    
    
    207,061
    
    
    
    (94,235
    )
    
    
    187,006Net increase (decrease) in cash and cash equivalents
    
    
    4,466
    
    
    
    (6,999
    )
    
    
    5,203
    
    
    
    
    
    
    
    2,670Cash and cash equivalents at beginning of period
    
    
    4,985
    
    
    
    7,028
    
    
    
    18,807
    
    
    
    
    
    
    
    30,820Cash and cash equivalents at end of period
    
    $
    9,451
    
    
    $
    29
    
    
    $
    24,010
    
    
    $
    
    
    
    $
    33,490
 22




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##### Table of Contents



LAND OLAKES, INC.
 SUPPLEMENTAL CONSOLIDATING BALANCE SHEET
December 31, 2008
 LandOLakes, Inc.
    
    
    
    
    
    
    Non-Parent
    
    
    Consolidated
    
    
    GuarantorCompany
    
    
    Guarantors
    
    
    Subsidiaries
    
    
    Eliminations
    
    
    ConsolidatedASSETSCurrent assets:Cash and cash equivalents
    
    $
    4,985
    
    
    $
    7,028
    
    
    $
    18,807
    
    
    $
    
    
    
    $
    30,820Receivables, net
    
    
    130,313
    
    
    
    580,897
    
    
    
    941,107
    
    
    
    (548,056
    )
    
    
    1,104,261Intercompany receivables, net
    
    
    238,447
    
    
    
    9,633
    
    
    
    1,240
    
    
    
    (249,320
    )
    
    
    Inventories
    
    
    377,150
    
    
    
    606,765
    
    
    
    100,063
    
    
    
    
    
    
    
    1,083,978Prepaid assets
    
    
    686,331
    
    
    
    410,295
    
    
    
    4,379
    
    
    
    
    
    
    
    1,101,005Other current assets
    
    
    105,190
    
    
    
    16,715
    
    
    
    1,599
    
    
    
    
    
    
    
    123,504Total current assets
    
    
    1,542,416
    
    
    
    1,631,333
    
    
    
    1,067,195
    
    
    
    (797,376
    )
    
    
    3,443,568Investments
    
    
    1,058,744
    
    
    
    57,027
    
    
    
    16,517
    
    
    
    (817,801
    )
    
    
    314,487Property, plant and equipment, net
    
    
    252,638
    
    
    
    294,212
    
    
    
    111,411
    
    
    
    
    
    
    
    658,261Goodwill, net
    
    
    191,936
    
    
    
    64,532
    
    
    
    20,708
    
    
    
    
    
    
    
    277,176Other intangibles, net
    
    
    2,113
    
    
    
    111,763
    
    
    
    7,106
    
    
    
    
    
    
    
    120,982Other assets
    
    
    71,684
    
    
    
    40,553
    
    
    
    58,485
    
    
    
    (3,884
    )
    
    
    166,838Total assets
    
    $
    3,119,531
    
    
    $
    2,199,420
    
    
    $
    1,281,422
    
    
    $
    (1,619,061
    )
    
    $
    4,981,312LIABILITIES AND EQUITIESCurrent liabilities:Notes and short-term obligations
    
    $
    19,998
    
    
    $
    2,244
    
    
    $
    912,595
    
    
    $
    (525,467
    )
    
    $
    409,370Current portion of long-term debt
    
    
    281
    
    
    
    50
    
    
    
    2,533
    
    
    
    
    
    
    
    2,864Accounts payable
    
    
    418,156
    
    
    
    739,547
    
    
    
    41,247
    
    
    
    (22,955
    )
    
    
    1,175,995Intercompany payables, net
    
    
    
    
    
    
    246,342
    
    
    
    2,978
    
    
    
    (249,320
    )
    
    
    Customer advances
    
    
    643,180
    
    
    
    401,417
    
    
    
    1,108
    
    
    
    
    
    
    
    1,045,705Accrued liabilities
    
    
    185,234
    
    
    
    198,440
    
    
    
    43,338
    
    
    
    (3,518
    )
    
    
    423,494Patronage refunds and other member equities payable
    
    
    37,751
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    37,751Total current liabilities
    
    
    1,304,600
    
    
    
    1,588,040
    
    
    
    1,003,799
    
    
    
    (801,260
    )
    
    
    3,095,179Long-term debt
    
    
    512,785
    
    
    
    71
    
    
    
    19,099
    
    
    
    
    
    
    
    531,955Employee benefits and other liabilities
    
    
    325,294
    
    
    
    29,047
    
    
    
    4,063
    
    
    
    
    
    
    
    358,404Commitments and contingenciesEquities:Capital stock
    
    
    1,611
    
    
    
    (34
    )
    
    
    2,935
    
    
    
    (2,901
    )
    
    
    1,611Additional paid-in capital
    
    
    
    
    
    
    200,643
    
    
    
    73,885
    
    
    
    (274,528
    )
    
    
    Member equities
    
    
    947,141
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    947,141Accumulated other comprehensive loss
    
    
    (150,277
    )
    
    
    (15
    )
    
    
    (31
    )
    
    
    46
    
    
    
    (150,277
    )Retained earnings
    
    
    178,377
    
    
    
    381,679
    
    
    
    158,739
    
    
    
    (540,418
    )
    
    
    178,377Total Land OLakes, Inc. equities
    
    
    976,852
    
    
    
    582,273
    
    
    
    235,528
    
    
    
    (817,801
    )
    
    
    976,852Noncontrolling interests
    
    
    
    
    
    
    (11
    )
    
    
    18,933
    
    
    
    
    
    
    
    18,922Total equities
    
    
    976,852
    
    
    
    582,262
    
    
    
    254,461
    
    
    
    (817,801
    )
    
    
    995,774Total liabilities and equities
    
    $
    3,119,531
    
    
    $
    2,199,420
    
    
    $
    1,281,422
    
    
    $
    (1,619,061
    )
    
    $
    4,981,312
 23




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##### Table of Contents



LAND OLAKES, INC.
 SUPPLEMENTAL CONSOLIDATING STATEMENT OF OPERATIONS
For the Three Months Ended March 31, 2008
 LandOLakes, Inc.
    
    
    
    
    
    
    Non-Parent
    
    
    Consolidated
    
    
    GuarantorCompany
    
    
    Guarantors
    
    
    Subsidiaries
    
    
    Eliminations
    
    
    ConsolidatedNet sales
    
    $
    1,636,597
    
    
    $
    1,364,571
    
    
    $
    255,831
    
    
    $
    
    
    
    $
    3,256,999Cost of sales
    
    
    1,536,532
    
    
    
    1,268,501
    
    
    
    201,259
    
    
    
    
    
    
    
    3,006,292Gross profit
    
    
    100,065
    
    
    
    96,070
    
    
    
    54,572
    
    
    
    
    
    
    
    250,707Selling, general and administrative
    
    
    71,047
    
    
    
    79,831
    
    
    
    16,701
    
    
    
    
    
    
    
    167,579Restructuring and impairment charges
    
    
    53
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    53Earnings from operations
    
    
    28,965
    
    
    
    16,239
    
    
    
    37,871
    
    
    
    
    
    
    
    83,075Interest expense (income), net
    
    
    14,982
    
    
    
    3,203
    
    
    
    (1,050
    )
    
    
    
    
    
    
    17,135Other expense, net
    
    
    
    
    
    
    12
    
    
    
    
    
    
    
    
    
    
    
    12Equity in (earnings) losses of affiliated companies
    
    
    (48,991
    )
    
    
    81
    
    
    
    (11,093
    )
    
    
    55,901
    
    
    
    (4,102
    )Earnings before income taxes
    
    
    62,974
    
    
    
    12,943
    
    
    
    50,014
    
    
    
    (55,901
    )
    
    
    70,030Income tax expense
    
    
    1,691
    
    
    
    71
    
    
    
    5,160
    
    
    
    
    
    
    
    6,922Net earnings
    
    
    61,283
    
    
    
    12,872
    
    
    
    44,854
    
    
    
    (55,901
    )
    
    
    63,108Less: net earnings attributable to noncontrolling interests
    
    
    
    
    
    
    
    
    
    
    1,825
    
    
    
    
    
    
    
    1,825Net earnings attributable to Land OLakes, Inc.
    
    $
    61,283
    
    
    $
    12,872
    
    
    $
    43,029
    
    
    $
    (55,901
    )
    
    $
    61,283
 24




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##### Table of Contents



LAND OLAKES, INC.
 SUPPLEMENTAL CONSOLIDATING STATEMENT OF CASH FLOWS
For the Three Months Ended March 31, 2008
 LandOLakes, Inc.
    
    
    
    
    
    
    Non-Parent
    
    
    Consolidated
    
    
    GuarantorCompany
    
    
    Guarantors
    
    
    Subsidiaries
    
    
    Eliminations
    
    
    ConsolidatedCash flows from operating activities:Net earnings attributable to Land OLakes, Inc.
    
    $
    61,283
    
    
    $
    12,872
    
    
    $
    43,029
    
    
    $
    (55,901
    )
    
    $
    61,283Adjustments to reconcile net earnings attributable to
Land OLakes, Inc. to net cash provided (used) by
operating activities:Depreciation and amortization
    
    
    9,760
    
    
    
    10,168
    
    
    
    2,218
    
    
    
    
    
    
    
    22,146Amortization of deferred financing costs
    
    
    489
    
    
    
    
    
    
    
    36
    
    
    
    
    
    
    
    525Bad debt expense
    
    
    388
    
    
    
    460
    
    
    
    138
    
    
    
    
    
    
    
    986Proceeds from patronage revolvement received
    
    
    1,560
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,560Non-cash patronage income
    
    
    (783
    )
    
    
    (548
    )
    
    
    
    
    
    
    
    
    
    
    (1,331
    )Deferred income tax benefit
    
    
    (14,631
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (14,631
    )Increase in other assets
    
    
    (425
    )
    
    
    (537
    )
    
    
    (30
    )
    
    
    44
    
    
    
    (948
    )Increase in other liabilities
    
    
    5,801
    
    
    
    (76
    )
    
    
    
    
    
    
    
    
    
    
    5,725Restructuring and impairment charges
    
    
    53
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    53Loss on sale of investment
    
    
    
    
    
    
    12
    
    
    
    
    
    
    
    
    
    
    
    12Equity in (earnings) losses of affiliated companies
    
    
    (48,991
    )
    
    
    81
    
    
    
    (11,093
    )
    
    
    55,901
    
    
    
    (4,102
    )Dividends from investments in affiliated companies
    
    
    227
    
    
    
    500
    
    
    
    4,721
    
    
    
    
    
    
    
    5,448Net earnings attributable to noncontrolling interests
    
    
    
    
    
    
    
    
    
    
    1,825
    
    
    
    
    
    
    
    1,825Other
    
    
    (189
    )
    
    
    5
    
    
    
    (10
    )
    
    
    
    
    
    
    (194
    )Changes in current assets and liabilities, net of
acquisitions and divestitures:Receivables
    
    
    (95,538
    )
    
    
    (38,902
    )
    
    
    (353,163
    )
    
    
    36,976
    
    
    
    (450,627
    )Inventories
    
    
    34,607
    
    
    
    (124,781
    )
    
    
    (22,475
    )
    
    
    
    
    
    
    (112,649
    )Prepaids and other current assets
    
    
    422,705
    
    
    
    (64,662
    )
    
    
    (3,161
    )
    
    
    (2
    )
    
    
    354,880Accounts payable
    
    
    40,143
    
    
    
    139,454
    
    
    
    23,296
    
    
    
    2,375
    
    
    
    205,268Customer advances
    
    
    (465,392
    )
    
    
    37,163
    
    
    
    (899
    )
    
    
    
    
    
    
    (429,128
    )Accrued liabilities
    
    
    64,020
    
    
    
    23,934
    
    
    
    2,249
    
    
    
    1,080
    
    
    
    91,283Net cash provided (used) by operating activities
    
    
    15,087
    
    
    
    (4,857
    )
    
    
    (313,319
    )
    
    
    40,473
    
    
    
    (262,616
    )Cash flows from investing activities:Additions to property, plant and equipment
    
    
    (4,221
    )
    
    
    (9,106
    )
    
    
    (10,989
    )
    
    
    
    
    
    
    (24,316
    )Acquisitions, net of cash acquired
    
    
    
    
    
    
    
    
    
    
    (6,419
    )
    
    
    
    
    
    
    (6,419
    )Investments in affiliates
    
    
    (50,600
    )
    
    
    
    
    
    
    (235
    )
    
    
    
    
    
    
    (50,835
    )Distributions from investments in affiliated companies
    
    
    
    
    
    
    
    
    
    
    4,448
    
    
    
    
    
    
    
    4,448Proceeds from sale of investments
    
    
    
    
    
    
    49
    
    
    
    
    
    
    
    
    
    
    
    49Proceeds from sale of property, plant and equipment
    
    
    
    
    
    
    66
    
    
    
    
    
    
    
    
    
    
    
    66Change in notes receivable
    
    
    (5,657
    )
    
    
    500
    
    
    
    (881
    )
    
    
    
    
    
    
    (6,038
    )Other
    
    
    (208
    )
    
    
    
    
    
    
    (268
    )
    
    
    
    
    
    
    (476
    )Net cash used by investing activities
    
    
    (60,686
    )
    
    
    (8,491
    )
    
    
    (14,344
    )
    
    
    
    
    
    
    (83,521
    )Cash flows from financing activities:Increase (decrease) in short-term debt
    
    
    56,347
    
    
    
    (2,429
    )
    
    
    328,486
    
    
    
    (40,473
    )
    
    
    341,931Proceeds from issuance of long-term debt
    
    
    (1,559
    )
    
    
    
    
    
    
    2,225
    
    
    
    
    
    
    
    666Principal payments on long-term debt and capital
lease obligations
    
    
    (499
    )
    
    
    (196
    )
    
    
    (11,998
    )
    
    
    
    
    
    
    (12,693
    )Payments for redemption of member equities
    
    
    (22,161
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (22,161
    )Distribution to members
    
    
    30,900
    
    
    
    
    
    
    
    (30,900
    )
    
    
    
    
    
    
    Other
    
    
    (36
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (36
    )Net cash provided (used) by financing activities
    
    
    62,992
    
    
    
    (2,625
    )
    
    
    287,813
    
    
    
    (40,473
    )
    
    
    307,707Net increase (decrease) in cash and cash equivalents
    
    
    17,393
    
    
    
    (15,973
    )
    
    
    (39,850
    )
    
    
    
    
    
    
    (38,430
    )Cash and cash equivalents at beginning of period
    
    
    12,411
    
    
    
    17,036
    
    
    
    87,392
    
    
    
    
    
    
    
    116,839Cash and cash equivalents at end of period
    
    $
    29,804
    
    
    $
    1,063
    
    
    $
    47,542
    
    
    $
    
    
    
    $
    78,409
 25




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##### Table of Contents



Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations
 You should read the following discussions of financial condition and results of operations
together with the financial statements and the notes to such statements included elsewhere in this
Form 10-Q.
 Overview
 General
  ® ® ® ® ®
  Seasonality
  26




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##### Table of Contents



Dairy and Agricultural Commodity Inputs and Outputs
  Dairy Foods.
   For the three months endedMarch 31,2009
    
    2008Per pound market price average for three months ended:Butter (CME)
    
    $
    1.13
    
    
    $
    1.26Block cheese (CME)
    
    
    1.18
    
    
    
    1.88Non fat dry milk (NASS)
    
    
    0.82
    
    
    
    1.36
 Feed
    27




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##### Table of Contents



Layers
 Derivative Commodity Instruments
  For the three months endedMarch 31,2009
    
    2008($ in millions)Unrealized hedging loss
    
    $
    (2.5
    )
    
    $
    (27.9
    )
 Vendor Rebates
  Recoverability of Long-Lived Assets
  28




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##### Table of Contents



Unconsolidated Businesses
  For the three months endedMarch 31,2009
    
    2008(in millions)(Losses) earnings from unconsolidated businesses
    
    $
    (7.2
    )
    
    $
    4.1
     Results of Operations
 Three months ended March 31, 2009 as compared to three months ended March 31, 2008
 Overview of Results
 For the three months ended March 31,Increase2009
    
    2008
    
    (Decrease)($ in millions)Net earnings
    
    $
    82.7
    
    
    $
    61.3
    
    
    $
    21.4
   29




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##### Table of Contents



For the three months ended March 31,Increase2009
    
    2008
    
    (Decrease)($ in millions)Net sales
    
    $
    2,947.3
    
    
    $
    3,257.0
    
    
    $
    (309.7
    )Net sales increased $148.0 million in Seed and declined in Dairy Foods, Agronomy, Feed and
Layers by $294.9 million, $78.8 million, $47.9 million and $42.9 million, respectively. The
decrease in net sales was primarily driven by lower market pricing in milk, cheese and eggs and
lower volume in Agronomy as customers built inventory ahead of price increases in the fall of 2008,
reducing demand in 2009. A discussion of net sales by business segment is found below under the
caption Net Sales and Gross Profit by Business Segment.Gross profit
    
    $
    260.0
    
    
    $
    250.7
    
    
    $
    9.3Gross profit increased in the three months ended March 31, 2009 largely driven by Seed and
improvements in unrealized hedging losses. These increases were mostly offset by declining markets
in Dairy Foods and Layers which resulted in lower gross profit in both of those segments. A
discussion of gross profit by business segment is found below under the caption Net Sales and
Gross Profit by Business Segment.Selling, general and administrative expense
    
    $
    163.3
    
    
    $
    167.6
    
    
    $
    (4.3
    )The decrease in selling, general and administrative expense compared to the prior year was
primarily due to lower expenses in Layers due to a $3.3 million gain on the sale of fixed assets.Restructuring and impairment charges
    
    $
    0.3
    
    
    $
    0.1
    
    
    $
    0.2During the three months ended March 31, 2009, Feed incurred restructuring charges primarily
related to employee severance due to reorganization of Feed personnel. During the three months
ended March 31, 2008, Dairy Foods incurred restructuring charges related to a long-term contractual
obligation for waste-water treatment with the City of Greenwood as the result of a closed facility
in Greenwood, Wisconsin.Interest expense, net
    
    $
    13.2
    
    
    $
    17.1
    
    
    $
    (3.9
    )The decrease in interest expense was largely due to lower interest rates. The total debt
level remained relatively flat in the current year versus the prior year.Equity in (losses) earnings of affiliated companies
    
    $
    (7.2
    )
    
    $
    4.1
    
    
    $
    (11.3
    )Decreased equity in earnings of affiliated companies is primarily related to lower earnings
from Layers and Agriliance investments. In Layers, equity method investments had earnings of $1.6
million for the three months ended March 31, 2009, compared to equity earnings of $11.1 million for
the same period of 2008, primarily due to lower egg prices impacting the results of equity method
investees. Results for the three months ended March 31, 2009 included equity losses from Agriliance
of $11.7 million compared to equity losses of $8.3 million for the same period of 2008. A
discussion of net earnings for Agriliance can be found under the caption Overview Unconsolidated
Businesses.Income tax (benefit) expense
    
    $
    (1.2
    )
    
    $
    6.9
    
    
    $
    (8.1
    )
  30




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##### Table of Contents



Net Sales and Gross Profit by Business Segment
  Dairy Foods
 For the three months ended March 31,($ in millions)
    
    2009
    
    2008
    
    % changeNet sales
    
    $
    753.2
    
    
    $
    1,048.1
    
    
    
    (28.1
    )%Gross profit
    
    
    31.1
    
    
    
    41.8
    
    
    
    (25.6
    )%Gross profit % of net sales
    
    
    4.1
    %
    
    
    4.0
    %
 Increase(decrease)Net Sales Variance
    
    (In millions)Pricing / product mix impact
    
    $
    (298.0
    )Volume impact
    
    
    3.1Total decrease
    
    $
    (294.9
    )
  Increase(decrease)Gross Profit Variance
    
    (In millions)Margin / product mix impact
    
    $
    (6.0
    )Volume impact
    
    
    (1.0
    )Unrealized hedging
    
    
    (3.7
    )Total decrease
    
    $
    (10.7
    )
  Feed
 For the three months ended March 31,($ in millions)
    
    2009
    
    
    2008
    
    
    % changeNet sales
    
    $
    893.8
    
    
    $
    941.7
    
    
    
    (5.1
    )%Gross profit
    
    
    72.4
    
    
    
    80.1
    
    
    
    (9.6
    )%Gross profit % of net sales
    
    
    8.1
    %
    
    
    8.5
    %
 Increase(decrease)Net Sales Variance
    
    (In millions)Pricing / product mix impact
    
    $
    5.6Volume impact
    
    
    (53.5
    )Total decrease
    
    $
    (47.9
    )
  31




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Increase(decrease)Gross Profit Variance
    
    (In millions)Margin / product mix impact
    
    $
    (21.4
    )Volume impact
    
    
    (6.4
    )Unrealized hedging
    
    
    20.1Total decrease
    
    $
    (7.7
    )
  Seed
 For the three months ended March 31,($ in millions)
    
    2009
    
    2008
    
    % changeNet sales
    
    $
    775.1
    
    
    $
    627.1
    
    
    
    23.6
    %Gross profit
    
    
    111.4
    
    
    
    66.4
    
    
    
    67.8
    %Gross profit % of net sales
    
    
    14.4
    %
    
    
    10.6
    %
 Increase(decrease)Net Sales Variance
    
    (In millions)Pricing / product mix impact
    
    $
    131.5Volume impact
    
    
    16.2Acquisitions and divestitures
    
    
    0.3Total increase
    
    $
    148.0
  Increase(decrease)Gross Profit Variance
    
    (In millions)Margin / product mix impact
    
    $
    39.9Volume impact
    
    
    (2.9
    )Unrealized hedging
    
    
    8.0Total increase
    
    $
    45.0
  32




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Layers
 For the three months ended March 31,($ in millions)
    
    2009
    
    2008
    
    % changeNet sales
    
    $
    138.2
    
    
    $
    181.1
    
    
    
    (23.7
    )%Gross profit
    
    
    11.5
    
    
    
    33.9
    
    
    
    (66.1
    )%Gross profit % of net sales
    
    
    8.3
    %
    
    
    18.7
    %
 Increase(decrease)Net Sales Variance
    
    (In millions)Pricing / product mix impact
    
    $
    (43.0
    )Volume impact
    
    
    0.1Total decrease
    
    $
    (42.9
    )
  Increase(decrease)Gross Profit Variance
    
    (In millions)Margin / product mix impact
    
    $
    (30.5
    )Volume impact
    
    
    0.2Unrealized hedging
    
    
    7.9Total decrease
    
    $
    (22.4
    )
  Agronomy
 For the three months ended March 31,($ in millions)
    
    2009
    
    2008
    
    % changeNet sales
    
    $
    408.4
    
    
    $
    487.2
    
    
    
    (16.2
    )%Gross profit
    
    
    33.2
    
    
    
    29.3
    
    
    
    13.3
    %Gross profit % of net sales
    
    
    8.1
    %
    
    
    6.0
    %
 Increase(decrease)Net Sales Variance
    
    (In millions)Pricing / product mix impact
    
    $
    43.3Volume impact
    
    
    (115.7
    )Acquisitions and divestitures
    
    
    (6.4
    )Total decrease
    
    $
    (78.8
    )
  33




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Increase(decrease)Gross Profit Variance
    
    (In millions)Margin / product mix impact
    
    $
    17.6Volume impact
    
    
    (7.0
    )Unrealized hedging
    
    
    (0.2
    )Acquisitions and divestitures
    
    
    (6.5
    )Total increase
    
    $
    3.9
  Liquidity and Capital Resources
 Overview
       As of
    
    
    As of
    
    
    As ofMarch 31,
    
    
    March 31,
    
    
    December 31,2009
    
    
    2008
    
    
    2008($ in millions)Cash and cash equivalents
    
    $
    33.5
    
    
    $
    78.4
    
    
    $
    30.8Availability on revolving credit facility
    
    
    88.6
    
    
    
    93.6
    
    
    
    188.6Availability on receivable securitization program
    
    
    
    
    
    
    110.0
    
    
    
    120.0Availability on the Agriliance credit facility
    
    
    7.0
    
    
    
    20.0
    
    
    
    Availability on the MoArk revolving credit facility
    
    
    40.0
    
    
    
    40.0
    
    
    
    40.0Total liquidity
    
    $
    169.1
    
    
    $
    342.0
    
    
    $
    379.4
  34




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Cash Flows
  Operating Activities
 For the Three Months EndedMarch 31,2009
    
    
    2008($ in millions)Net earnings attributable to Land OLakes, Inc.
    
    $
    82.7
    
    
    $
    61.3Adjustments to reconcile net earnings attributable to Land OLakes, Inc. to
net cash used by operating activities
    
    
    29.3
    
    
    
    17.1Changes in current assets and liabilities, net of acquisitions and divestitures
    
    
    (270.8
    )
    
    
    (341.0
    )Net cash used by operating activities
    
    $
    (158.8
    )
    
    $
    (262.6
    )
  Investing Activities
 For the Three Months EndedMarch 31,2009
    
    
    2008($ in millions)Additions to property, plant and equipment
    
    $
    (36.9
    )
    
    $
    (24.3
    )Acquisitions, net of cash acquired
    
    
    
    
    
    
    (6.4
    )Investments in affiliates
    
    
    (0.4
    )
    
    
    (50.8
    )Distributions from investments in affiliated companies
    
    
    
    
    
    
    4.4Proceeds from sale of investments
    
    
    5.6
    
    
    
    Proceeds from foreign currency exchange contracts on sale of investment
    
    
    0.5
    
    
    
    Proceeds from sale of property, plant and equipment
    
    
    0.8
    
    
    
    0.1Insurance proceeds for replacement assets
    
    
    4.4
    
    
    
    Change in notes receivable
    
    
    0.3
    
    
    
    (6.0
    )Other
    
    
    0.2
    
    
    
    (0.5
    )Net cash used by investing activities
    
    $
    (25.5
    )
    
    $
    (83.5
    )
   Financing Activities
 For the Three Months EndedMarch 31,2009
    
    
    2008($ in millions)Increase in short-term debt, net
    
    $
    208.2
    
    
    $
    341.9Proceeds from issuance of long-term debt
    
    
    
    
    
    
    0.7Principal payments on long-term debt and obligations under capital lease
    
    
    (0.7
    )
    
    
    (12.7
    )Payments for redemption of member equities
    
    
    (18.9
    )
    
    
    (22.2
    )Other
    
    
    (1.6
    )
    
    
    Net cash provided by financing activities
    
    $
    187.0
    
    
    $
    307.7
  35




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Principal Debt Facilities
         36




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Capital Leases
  Recent Accounting Pronouncements
  37




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38




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Critical Accounting Policies
  Forward-Looking Statements
  
 Item 3. Quantitative and Qualitative Disclosures About Market Risk
  39




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Item 4. Controls and Procedures
 Evaluation of disclosure controls and procedures
   Remediation and Changes in Internal Control over Financial Reporting
  Inadequate interim periodic close process
  Personnel lacked adequate accounting expertise and business knowledge
   Remediation and Changes in Internal Control over Financial Reporting:
  Change in internal controls
  40




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Part II. Other Information
 
 Item 1. Legal Proceedings
  ® ® ® ® ®
    41




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Item 1A. Risk Factors
 (www.sec.gov)
 
    
    COMPETITION IN THE INDUSTRY MAY REDUCE OUR SALES AND MARGINS.
    
    THE CURRENT ECONOMIC DOWNTURN COULD ADVERSELY AFFECT THE COMPANYS BUSINESS AND
FINANCIAL RESULTS.
    
    THE CURRENT CREDIT CRISIS COULD NEGATIVELY AFFECT OUR LIQUIDITY, INCREASE OUR COSTS
OF BORROWING AND DISRUPT THE OPERATIONS OF OUR SUPPLIERS AND CUSTOMERS.
    
    OUR OPERATIONS ARE SUBJECT TO NUMEROUS LAWS AND REGULATIONS, EXPOSING US TO
POTENTIAL CLAIMS AND COMPLIANCE COSTS THAT COULD ADVERSELY AFFECT OUR MARGINS,
PARTICULARLY THOSE RELATED TO OUR SALES OF ROUNDUP READY® ALFALFA.
    
    THE GEOGRAPHIC SHIFT IN DAIRY PRODUCTION HAS DECREASED SALES AND MARGINS AND COULD
CONTINUE TO NEGATIVELY IMPACT OUR SALES AND MARGINS.
    
    CURRENT AND THREATENED LITIGATION COULD INCREASE OUR EXPENSES, REDUCE OUR
PROFITABILITY, AND, IN SOME CASES, ADVERSELY AFFECT OUR BUSINESS REPUTATION.
    
    CHANGES IN CONSUMER PREFERENCES AND DISTRIBUTION CHANNELS COULD DECREASE OUR DAIRY
FOODS REVENUES AND CASH FLOWS.
    
    OUR OPERATING RESULTS FLUCTUATE BY SEASON AND ARE AFFECTED BY WEATHER CONDITIONS.
    
    INCREASED ENERGY AND GAS COSTS COULD INCREASE OUR EXPENSES AND REDUCE OUR
PROFITABILTIY.
    
    OUTBREAKS OF DISEASE CAN REDUCE OUR NET SALES AND OPERATING MARGINS.
    
    CHANGES IN THE MARKET PRICES OF THE COMMODITIES THAT WE USE AS INPUTS AS WELL AS
THE PRODUCTS WE MARKET MAY CAUSE OUR MARGINS TO DECLINE AND REDUCE THE LIKELIHOOD OF
RECEIVING DIVIDENDS FROM OUR JOINT VENTURES.
    
    WE OPERATE THROUGH JOINT VENTURES IN WHICH OUR RIGHTS TO EARNINGS AND TO CONTROL
THE JOINT VENTURE ARE LIMITED.
    
    CERTAIN OF OUR BUSINESSES MAY BE ADVERSELY AFFECTED BY OUR DEPENDENCE UPON OUR
SUPPLIERS.
    
    THE MANNER IN WHICH WE PAY FOR CERTAIN OF OUR INPUTS AND OTHER PRODUCTS THAT WE
DISTRIBUTE EXPOSES US TO SUPPLIER-SPECIFIC RISK.
    
    INCREASED FINANCIAL LEVERAGE COULD ADVERSELY AFFECT OUR ABILITY TO FULFILL OUR
OBLIGATIONS UNDER OUR DEBT FACILITIES AND TO OPERATE OUR BUSINESSES.
    
    SERVICING OUR INDEBTEDNESS REQUIRES A SIGNIFICANT AMOUNT OF CASH, AND OUR ABILITY
TO GENERATE CASH DEPENDS ON MANY FACTORS BEYOND OUR CONTROL.
 42




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
    
    IF CREDITORS OF OUR SUBSIDIARIES AND JOINT VENTURES MAKE CLAIMS WITH RESPECT TO THE
ASSETS AND EARNINGS OF THESE COMPANIES, SUFFICIENT FUNDS MAY NOT BE AVAILABLE TO REPAY
OUR INDEBTEDNESS AND WE MAY NOT RECEIVE THE CASH WE EXPECT FROM INTERCOMPANY TRANSFERS.
    
    THE COLLATERAL PLEDGED IN SUPPORT OF OUR DEBT OBLIGATIONS MAY NOT BE VALUABLE
ENOUGH TO SATISFY ALL THE BORROWINGS SECURED BY THE COLLATERAL.
    
    A LOSS OF OUR COOPERATIVE TAX STATUS COULD INCREASE OUR TAX LIABILITY.
    
    OUR LIMITED ACCESS TO EQUITY MARKETS COULD ADVERSELY AFFECT OUR ABILITY TO OBTAIN
ADDITIONAL EQUITY CAPITAL.
    
    INABILITY TO PROTECT OUR TRADEMARKS AND OTHER PROPRIETARY RIGHTS COULD DAMAGE OUR
COMPETITIVE POSITION.
    
    OUR BRAND NAMES COULD BE CONFUSED WITH NAMES OF OTHER COMPANIES WHO, BY THEIR ACT
OR OMISSION, COULD ADVERSELY AFFECT THE VALUE OF OUR BRAND NAMES.
    
    A CHANGE IN THE ASSUMPTIONS USED TO VALUE OUR REPORTING UNITS OR OUR
INDEFINITE-LIVED INTANGIBLE ASSETS COULD NEGATIVELY AFFECT OUR CONSOLIDATED RESULTS OF
OPERATIONS AND NET WORTH.
    
    PRODUCT LIABILITY CLAIMS OR PRODUCT RECALLS COULD ADVERSELY AFFECT OUR BUSINESS
REPUTATION AND EXPOSE US TO INCREASED SCRUTINY BY FEDERAL AND STATE REGULATORS.
    
    WE COULD INCUR SIGNIFICANT COSTS FOR VIOLATIONS OF OR LIABILITIES UNDER
ENVIRONMENTAL LAWS AND REGULATIONS APPLICABLE TO OUR OPERATIONS.
    
    STRIKES OR WORK STOPPAGES BY OUR UNIONIZED WORKERS COULD DISRUPT OUR BUSINESS.
    
    THERE IS NO ASSURANCE THAT OUR SENIOR MANAGEMENT TEAM OR OTHER KEY EMPLOYEES WILL
REMAIN WITH US.
 
 Item 6. Exhibits
 (a) Exhibits
 EXHIBIT
    
    DESCRIPTION31.1
    
    Certification Pursuant to 15 U.S.C. Section 7241, as adopted pursuant to Section
302 of the Sarbanes-Oxley Act of 2002*31.2
    
    Certification Pursuant to 15 U.S.C. Section 7241, as adopted pursuant to Section
302 of the Sarbanes-Oxley Act of 2002*32.1
    
    Certification Pursuant to 18 U.S.C. Section 1350, As Adopted Pursuant to Section 906
of the Sarbanes-Oxley Act of 2002*32.2
    
    Certification Pursuant to 18 U.S.C. Section 1350, As Adopted Pursuant to Section 906
of the Sarbanes-Oxley Act of 2002*
 
 *
    
    Filed electronically herewith 43




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SIGNATURES
  LAND OLAKES, INC.By
    /s/ Daniel KnutsonDaniel KnutsonSenior Vice President and Chief Financial Officer
(Principal Financial and Accounting Officer) 44