Agricore Manages Second Quarter Profit

WINNIPEG - Jun 7/07 - SNS -- Agricore United reported net income of CDN $2.06 million on sales of $814.6 million for the second quarter ending April 30, a marked improvement on the $8.02 million loss on sales of $569.8 million during the same three-month period last year.

This reduced the fiscal year to date loss to $12.86 million on sales of $1,524.3 million, down from a loss of $41.2 million on sales of $1,114.2 million the first half of the previous fiscal year.

Grain shipments for the six months increased by 121,000 metric tons (MT) to 5.5 million MT. Agricore United's ratio of industry grain shipments for the trailing twelve months ended April 30, 2007, increased to 34.6% from 33.6% for the fiscal year ended October 31, 2006.

Crop Production Services sales have also seen a strong recovery in the second quarter of 2007, with EBITDA of $10.2 million for the quarter ending April 30, 2007, $14.2 million higher than the loss of $4 million reported in the same quarter last year.

Increased sales activity in all product lines including seed, crop nutrition and crop protection products resulted in gross profit and revenue from services of $35.1 million for the quarter and $44.0 million for the first six months of 2007. The reported $16.4 million increase in gross profit and revenue from services for the six month period is primarily attributable to higher fertilizer volumes and margins in 2007 compared to the same period in 2006 as a result of heightened demand and improved commodity prices in the market this year.

Record earnings continued in Agricore United's Livestock Services segment, with feed volumes increasing by 293,000 MT to 813,000 MT during the six months ending April 30, 2007. Gross profit and net revenue in this segment increased to $20.4 million for the quarter, contributing to the total of $41.2 million reported for the first six months of 2007. The increase in gross profit is due mainly to the acquisition of Hi- Pro Feeds which closed in August of 2006. After the additional OG&A expenses associated with Hi-Pro, the company reported a 48% increase in EBITDA to a record $15.4 million for the six month period ending April 30, 2007.

Legal, financial and other advisory costs associated with the response to the Saskatchewan Wheat Pool (“SWP”) bid and related negotiations with James Richardson International Limited were $5.4 million for the current quarter, with total costs for the six month period ending April 30, 2007 at $8.2 million. On May 29, 2007, SWP announced it had taken up more than 75% of the issued and outstanding Limited Voting Common Shares of Agricore United.