Archer Daniels Midland Hurt by Weak Exports
03 May 2016 - 10:50PM
Dow Jones News
Archer Daniels Midland Co. reported a steeper-than-expected drop
in revenue and profit in its latest quarter, as the grain trader
and processor continued to face low exports and weak margins.
"Challenging market conditions continued in the first quarter,"
Chief Executive Juan Luciano said.
ADM, among the world's largest agribusinesses and a major
ethanol producer, has been buffeted recently by lower
ethanol-production margins and sluggish overseas demand for North
American crops. Mr. Luciano also pointed to poor results from
trading.
In the latest quarter, revenue in the Chicago company's
agricultural-services segment, its largest, fell 19% to $6.48
billion. Revenue in the corn-processing business fell 10.5% as the
oilseed-processing business posted a 21% drop in revenue. Total
processed volume for corn and oilseed fell 0.9%.
Still, Mr. Luciano said he was "optimistic" that reduced South
American soybean and corn production could improve margins and
merchandising opportunities in the second half of the year.
The company posted earnings of $230 million, or 39 cents a
share, down from $493 million, or 77 cents a share, a year prior.
Excluding gains on sales, losses on asset impairments and other
special items, per-share earnings fell to 42 cents a share from 78
cents a year before.
Revenue slid 18% to $14.38 billion.
Analysts had projected per-share earnings of 45 cents a share on
revenue of $17.02 billion.
Shares of the company, up 21% in the last three months, were
inactive in premarket trading.
Write to Austen Hufford at austen.hufford@wsj.com
(END) Dow Jones Newswires
May 03, 2016 08:35 ET (12:35 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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