South
East Area Reports for 1999
S.E. Minnesota FBM
FINANCIAL GUIDELINES MEASURES, 1999
(Farms sorted by Net Farm Income)
Average Of Average Of Average Of
All Farms High 20 % Low 20 %
Number of Farms 383 77 77
LIQUIDITY Beginning Ending Beginning Ending Beginning Ending
Current ratio 1.55 1.59 1.75 1.87 1.06 0.89
Working capital 50646 56743 119346 153633 5597 -10404
SOLVENCY (Market) Beginning Ending Beginning Ending Beginning Ending
Farm debt to asset ratio 53 % 50 % 54 % 48 % 64 % 61 %
Farm equity to asset ratio 47 % 50 % 46 % 52 % 36 % 39 %
Farm debt to equity ratio 115 % 100 % 117 % 93 % 177 % 158 %
PROFITABILITY Cost Market Cost Market Cost Market
Rate of return on farm assets 8.3 % 8.4 % 14.5 % 12.3 % -4.1 % 4.4 %
Rate of return on farm equity 9.4 % 11.1 % 21.5 % 19.0 % -35.2 % 0.7 %
Operating profit margin 19.6 % 25.1 % 29.7 % 30.0 % -13.5 % 20.6 %
Net farm income 54940 68933 181913 183095 -23344 20417
REPAYMENT CAPACITY Cash Accrual Cash Accrual Cash Accrual
Term debt coverage ratio 151 % 171 % 187 % 258 % 92 % 53 %
Capital replacement margin 21994 30774 69445 125601 -2961 -18207
EFFICIENCY
Asset turnover rate (market) 33.6 % 41.0 % 21.1 %
Operating expense ratio 70.1 % 66.6 % 86.5 %
Depreciation expense ratio 6.5 % 4.7 % 13.2 %
Interest expense ratio 7.4 % 5.7 % 14.6 %
Net farm income ratio 16.0 % 23.0 % -14.3 %
LABOR ANALYSIS
Average Of Average Of Average Of
All Farms High 20 % Low 20 %
Number of Farms 227 48 52
Total unpaid labor hours 2563 3472 1721
Total hired labor hours 1559 5069 541
Total labor hours per farm 4122 8541 2263
Value of farm production / hour 69.80 75.93 63.26
Net farm income / unpaid hour 21.20 55.38 -16.18
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