August 15, 2024

Dear Shareholders,

FarmWorks’ Clients continue to work extraordinarily hard to support their families and businesses and their communities. Many are having to work harder and longer, perhaps with fewer employees, to achieve the outcomes they seek. There are extraordinary forces affecting food from farmer to consumer. Nova Scotians buy about 80% of their food from elsewhere. And it’s now widely reported that about 50% of calories consumed are from foods that don’t contribute to our health, economy, environment, or quality of life.

Many issues are affecting local food: NS lost about 20% of farmers from 2016 to 2021; farmers without successors may sell for non-farm uses; farms and food businesses may be unable to raise prices to cover their rising costs; many farm net incomes are negative; banks charge up to 6% to 12% for loans to food-related business that may have a profit margin of 3 to 5%; missing infrastructure makes it nearly impossible to prepare and value-add produce; people may choose imported over local for a few cents difference; climate change is affecting production and there are insufficient funds for adaptation and mitigation. The graphs at the bottom of this letter show that net farm income was negative over the last seven years, and that supply managed milk, eggs and chicken provide a significant percentage of farm income.

Substantial health, economic, environmental and community benefits result from buying local food and beverages: sales inspire production of more fresh and lightly processed nutritious food provided by people who care how food is grown and prepared; consumer dollars multiply within the province; producers are better able to provide for their workers and their own families; connections are made between producers and eaters; community resilience increases; food miles decrease. There is no guarantee that the healthy foods we need will always arrive from elsewhere.

We must support local production of foods in these globally and locally challenging times. Clients and people knowledgeable about production in NS state that FarmWorks is providing incredible support for local production relative to the funds we have available. Those funds, currently $5,128,600, are the result of the confidence that you, as continuing and new shareholders, have in FarmWorks’ ability to assess clients, provide funds, mentor, connect and promote the people who start and grow food-related business that provide multiple benefits for Nova Scotians. Over thirteen years $10,033,400 has been loaned to clients. Each Offer of FarmWorks shares increases positive outcomes across Nova Scotia.  

FarmWorks’ Interim Financial Statements show that in the first half of the year interest income decreased as a number of clients deferred several payments, but clients’ revenue is increasing in the second half of the year and FarmWorks net income will subsequently increase. Two loans written off and increases in advertising and office costs increased expenses. There is an increase in impaired loans, generally for reasons described above, and the Directors are working together with the clients to achieve positive outcomes. Since FarmWorks beginning losses have amounted to less than 30% of interest income and shareholder investments are never at risk. Total assets increased in the thirteenth offer and 95% of the available $5,128,600 has been advanced to clients. Each month about $95,000 is repaid by clients and is available to lend.

Please read the Executive Summary of the 2023 Survey of FarmWorks Economic and Social Impacts for an overview of outcomes: before receiving funding 30% of applicants were not in operation; 52% were seeking loans to improve their business outcomes; 67% indicated that their business would not have succeeded without FarmWorks; 89% said the loan enabled their business to expand production; 69% were able to borrow additional funds after receiving a FarmWorks loan; 68% indicated that business outcomes were better because of FarmWorks mentoring, networking, and promotion.

Here's a link to an article HOW TAX CREDITS AND SOCIAL FINANCE ARE BUILDING A HEALTHY FUTURE FOR NOVA SCOTIANS which was published in Future of Good Magazine.

Locally and globally, events and issues affecting food and health of people and the planet are of great concern. With your investments and support, FarmWorks Directors continue to do everything in our power to help achieve better outcomes for all.

Please reserve Sunday November 17th for LOCAL LAUNCH at Fountain Commons with FarmWorks and Acadia Launchbox! Watch farmworks.ca/events for information!

We sincerely hope all is well with you, and please get in touch with any comments and suggestions.

Sincerely,

Linda, on behalf of the Directors