Ellen and Ryan guide attendees through a case study of how CHS, Inc. transformed from decentralized strategy discussions and individual spreadsheet-based financial models to a leading edge, long-range planning process. With Hyperion Strategic Finance (HSF) being a key component to the overall process change, Ellen and Ryan discuss both the opportunities and the challenges identified during the implementation, as well as the tools available for modeling, analysis, and reporting.

1. z al
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A Corporation Analyzes the Pros and Cons of
ain the Evolution of
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Hyperion Strategic Finance
Long-Term Planningf E dg
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Ellen Scipta
P Ryan Meester October 15, 2012
CHS Inc. Edgewater Ranzal
Finance & Business Strategic Planning
Planning Practice

2. Agenda
Introductions
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Long-Term Planning Overview
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CHS Study
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High Level Demonstration
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Q&A

3. Planning for Any Environment
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4. How Confident are You in Developing the
Corporate Strategy?
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CFO
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Corporate at er
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Treasury M&A
Finance
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P rop

5. Traditional Long-Range Planning Challenges
 Complex spreadsheet
models
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 No consolidated or
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Raintegrated models
Banks Investors Acquisitions consistent view
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Divestitures
 Lack of
at scenario analysis
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ge cumbersome
Ed  Limited history or
of
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Board of Directors
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Senior Management
documentation
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security
 Duplicative efforts
Treasury Long-Term Corporate
Planning Development

6. Hyperion Strategic Planning Overview
Economic Shifts
Predictive Modeling & Simulation
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Capacity Planning Growth Initiatives
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Long-Term (3-5 Year) Discounted Cash Flow
Full Financial Statement
Long-Term Financial
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atValue
Economic Value Added
wManagement
Projections Liquidation Value
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Key Performance Metrics Planning
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fE
o What-if
e rty Analysis
New Product Offerings
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Acquisitions / Divestitures
rop Corporate Treasury Capital Requirements
Development Strategies Reserve Ratios
Product Pricing Debt Issuances/Payments
Commodity Pricing Cost Cutting

7. CHS Inc.
 The nation’s leading
cooperative, owned by farmers,
ranchers and co-ops across the
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United States
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 A diversified energy, grains and
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foods business committed to
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providing the essential
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resources that enrich lives
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around the world
f
rt yo Business Divisions
ro pe  CHS Grains, Crop Nutrients
P and Retail
 CHS Energy
 CHS Foods and Processing
 CHS Business Solutions

8. CHS Ownership
62,000 individual 1,100 locally owned 10,000 preferred
producers (through cooperatives stockholders
company-owned serving about (CHSCP on
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facilities) 300,000 producers NASDAQ Exchange)
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Voting Equity 30% Voting Equity 70% Non-voting owners
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9. CHS Recent Highlights
 2012 Fortune #78
 Fiscal 2011 Net Income $961.4 Million
 Fiscal 2011 Net Revenues $36.9 Billion
 Fiscal 2012 Q3 YTD Net Income $899.7 Million
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Earnings History
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$ in millions
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10. Creating Value for Owners – Cash Returns
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$ in millions
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11. New Leadership and Vision
New CEO & Key Leadership Retirements/Changes, Jan 2011
 Updated Guiding Principles
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• Not a holding company
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• Not a speculative buyer and seller of businesses
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• Leveraging the diverse CHS enterprise to enhance
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producers‟ profitability
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 Focused on Growth
• Strategic expansion f
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• Balanced business portfolio
• Aspirations
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CHS Finance Department Created, February 2011

12. CHS Finance Team Challenge: Process & Content
 Quarterly forecasts
 Reduce Annual CEO/CFO
Board
Budgeting Efforts approval of
budget approval of
Consolidation of Plans
through ongoing
budget
and Presentations
Forecast and Corporate
Corporate
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Forecast
Strategy Budget Refresh Submission
discussions
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 Drive Consistency Forecast
Divisional Operating &
Forecast
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Submission Submission
&Rollup Capital Budgets &Rollup
 Annual and long
te
wa
Q4 Q1
range planning Corporate
 Vary drivers/growth
e
Forecast
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Submission
rates by line of
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Bank
business Q3 Q2
of
Meeting
 Analyze and set
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Corporate
top down‟s annual Forecast
budget targets by
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Corporate Budgets and Submission
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Allocations
line of business Reset Long
Drive Consistency
Forecast
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 Range Plan
Aspiration Submission
Refresh
 Assess patron &Rollup
equity options and
allocations Forecast
Identify base and
Submission
 &Rollup
incremental
Corporate
Forecast
funding needs Submission
 Aspirations

13. Aspirations
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Optimize current portfolio and playbook over next 5 years
 Scenario Analysis: Include/Exclude Aspirations
 Value acquisitions/divestitures d integrated within portfolio
 Model Range of Risk/Uncertainty
 Analyze funding scenarios and capital needs by year
 Connect treasury / corporate development with corporate FP&A functions
 Funding routine to define cash balancing process
13

14. Aspirations: From Concept To Tactical Plans To
Strategic Financial Models
CHS 5-
YEAR
CHS STRATEGIC STRATEGIC FINANCIAL GROWTH
ASPIRATIONS IMPERATIVES OBJECTIVES MERITS & PLAN
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• Producer – • Business Units Defined Actions
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• Unbiased Validation of Plays aka
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er PassTime to Scale
Focused Required to Remain Relevant And “The Aspirations”
• Global Grow Organically In Current Space
t • First Financials: EBITDA,
a CAPITAL,
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Commodities
• Aggregated Customer, Operational,
• Energy
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Regional, and Enterprise Leader POVs • Objective Scoring: Prioritizing A
• Food and Food
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on Future Incremental Opportunities Playbook
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Ingredients • Score each Play Based on:
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• Enhance/ • Outcome: Tactical Playbook for Next  Relevance to the
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Leverage 5 Years By Business Aspirations
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Enterprise  Risk in Execution

Value
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The result of our work was a Strategic Growth Plan that carves the
 Reward Potential
path of CHS for the next 5 years
 This is a key component of our planning process going forward as it
defines where our growth will come from

15. A Unique and All Encompassing Solution:
Hyperion Strategic Finance (HSF)
 Independent of ERP system
 Data Home, Data can be imported via Excel, Essbase / Planning, HFM, etc
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 Can leverage the strengths of other Hyperion products (i.e. Essbase for
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reporting)
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 Speed of Implementation
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 Fully Integrated Financial Statements
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 Customized Drivers and Metrics for Individual Business Units
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 Ease of Use
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 Time spent on analysis and recommendations not development
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 Ability to solve or allocate targets
 Scenarios in a cinch, base case simplified
 Reduces hours spent budgeting annually

16. HSF Implementation Lessons Learned
 Spend the Time on Model Design
 Business team awareness, partnership, and buy-in
 Capture the “right” details, build „placeholders‟ as needed
 Know the constraints of the tool and your IT systems up front
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 Don’t underestimate the effort to gather / validate data
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 Keep it Simple and Strategic
 Manage operational plans outside of HSF
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 Focus on primary business drivers, manage # of inputs
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 Use historic trend as available, play via scenarios
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 Spend the time: Run the data to find the Optimal solutions
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 Train the Team on the Functionality of the Tool
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 Get your hands dirty on reporting, scenarios, updates, formula changes etc.
 Manage access effectively
 Document religiously
 Continuous improvement

17. z al
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Demof Screen Shots
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18. Pre-Built Accounting Integrity
• Pre-built, fully integrated financial
statement foundation
• Pre-built forecast methods and formula
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functions
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• What-if Analysis toolkit
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19. Powerful Scenario Capabilities
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20. Easily Analyze Various Combinations
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Mix and Match
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Scenarios
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Capital Projects
included
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excluded
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21. World Class Treasury Analysis
• Calculates net cash
surplus or deficit from
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multiple models and
scenarios z
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• Funding Options tool to
re-allocate surpluses and at er
fund deficits
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• Debt scheduler
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User-defined reports to
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monitor covenants, credit
ratings, and earnings per
share

22. Acquisition / Divestiture Modeling
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23. Set Strategic Targets in HSF
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24. Seed Budgets With Strategic Targets
From
Strategic Plan
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25. Tweak Budget with Targets In Mind
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26. Update Targets with Latest Forecast
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