The worst US drought in a half-century has destroyed 45% of the corn and 35% of the soya bean crop, driven shipments of grain to multi-year lows, and is likely to cause record breaking food inflation.
Today, curiously, it may have cost one Canadian exec his job.
Hemisphere GPS (TSX:HEM) today announced that its board had appointed Rick Heiniger as its President and CEO. Heiniger replaces Steven Koles, who has resigned.
Early in 2012, Hemisphere GPS looked to be on the path to recovery. Shares of the company nearly doubled between December of last year and February 21st, when they peaked at $1.09. But as 2012 wore on, the effects of the drought in the lower forty-eight started to impact the balance sheet of Hemisphere GPS. Early in August, the company reported Q2, 2012 numbers that reflected problems beyond the scope of its own control. HEM’s revenue of $19.6-million was a 3% decrease from revenues of $20.1-million it reported in the same period last year.
The culprit was the massive drought in the United States. Sales to the US were down 14%, and increased sales to the Canadian market were not enough to offset the impact of the US drought. Koles said the drought conditions had forced him to temper his growth expectations for the year by 10%.
Instead the task of growing revenue at the Calgary-based company now falls to Heiniger, who says he is up for the job:
“I believe Hemisphere GPS can return to profitability by focusing on three priorities: our core agricultural business, streamlining and simplifying our business, and market-driven innovation for our customers.” He said, adding: “We intend to leverage our industry-leading technology and service capabilities to provide our customers with best-in-class solutions, building on the valuable Hemisphere GPS platform. I look forward to working with Hemisphere GPS’s strong leadership team and talented employees.”
Heiniger will resign his position as Vice Chairman of the Board. The 59 year old is the founder of Outback Guidance, which was acquired by the predecessor of Hemisphere GPS in 2005, and the inventor or co-inventor of more than 20 patents in the precision agriculture space.