The boss of the agricultural cooperative spoke to the Montreal business community Monday noon. While Sollio is experiencing a financial crisis, Pascal Houle instead talked to his audience about food autonomy and social responsibility.
However, its Olymel division will soon close six establishments and eliminate nearly 1,500 jobs.
Invited to the podium of the Canadian Club of Montreal, the CEO of the cooperative in office since September 2021 refused to answer questions from the press at the end of the event which was held at the Sheraton Center in front of around 450 people .
This is not the first time that a billionaire cooperative has refused to explain its financial situation to the public through the media. At the height of the turmoil, Agropur adopted the same policy in 2021 before resuming contact in 2022.
Sollio lost 346 million in two years. It has variable rate debt of 800 million which matures in June 2024. The weighted average rate on the loan stood at 8.38% in 2022. As a result of the increase in interest rates, the interest expense borne by Sollio increased by 135% between 2021 and 2022, reaching 84 million last year.
Lacking liquidity at the end of the 2022 financial year, it issued new preferred shares to its financiers as payment of dividends on the shares previously in their possession. This strategy has the effect of limiting immediate cash outflows in return for higher dividends to be paid in subsequent years.
Remember, Olymel has made a series of acquisitions since 2015. It acquired A. Trahan, from Yamachiche, and La Fernandière, from Trois-Rivières, in 2016, Aliments Triomphe for 65.2 million and the Ontario Pinty’s for 226 million in 2018, and F. Ménard, from Ange-Gardien, for 605 million in 2020, at the top of the cycle. However, over the past two years, Sollio has taken losses in value of its assets of 173 million.
Fiscal year 2023 ends at the end of October and the annual report usually follows in February.
If we rely on the comments made on Monday by Mr. Houle, there have been numerous challenges in recent months, particularly in the hardware division (BMR), which has more than 300 establishments.
“Interest rate increases, construction costs are increasing, land prices, labor prices and materials costs are all increasing,” the executive said. These are issues that we are experiencing today at the retail division level. People are having difficulty qualifying for loans. This creates a sudden slowdown on construction sites. We have been experiencing this for several months. We see a big slowdown. »
At the end of his speech, Pascal Houle had these few words about Olymel.
“The closure of trade borders with China had an impact on the Olymel division. It has relied heavily on the Chinese market for several years. We had to adapt. We had to reorient our ways of doing things. We still sell in Asia and China today. But we have reduced our exports. We sell more on the domestic market and value-added cutting products. We have diversified our product offerings. This is how we adapt to the closure of China. »
Annual revenues of 8.9 billion
16,000 employees
123,000 members
47 cooperatives
