Archer-Daniels-Midland Q4 Profit Tops View

(RTTNews) - Grain processor Archer-Daniels-Midland (ADM) Tuesday reported a lower fourth-quarter profit, hit by charges as well as lower revenues. However, adjusted earnings topped Wall Street estimates, amid lower corn costs and improved ethanol margins.

ADM CEO Patricia Woertz said, "Lower corn costs and improved ethanol margins helped support a significant improvement in our Corn business. Our great Oilseeds performance was driven by our ability to meet robust global demand for meal and by improved biodiesel results in North America and Europe.''

Net earnings attributable to the company fell to $374 million or $0.56 per share from $510 million or $0.77 per share in the previous year.

In November 2013, Australia had prohibited ADM's proposed acquisition of Australian grain handler and processor GrainCorp Limited (GRCLF, GNC.AX). Australian Treasurer Joe Hockey said the proposed deal was contrary to the national interest.

ADM said today that excluding $0.25 per share in specified GrainCorp-related items, impairment charges of $0.11 per share, and other items totaling $0.03 per share, adjusted earnings per share amounted to $0.95. Last year, adjusted earnings were $0.60 per share.

On average, 14 analysts polled by Thomson Reuters expected earnings per share of $0.85 for the quarter. Analysts' estimates typically exclude one-time items.

Net sales and other operating income slid to $24.14 billion from $24.92 billion last year. Analysts estimated revenues of $24.70 billion for the quarter.

Oilseeds Processing generated $8.19 billion in the quarter, down around 2 percent from last year, but operating profit improved year-over-year. Segment operating profit is a non-GAAP measure.

ADM's North America soybean crushing operations had strong margins as they processed record volumes on robust demand. South American earnings improved as a result of strong crushing and origination results and solid contributions from the crushing facility in Paraguay.

Corn Processing revenues improved marginally to $3.06 billion and operating profit significantly improved, amid strong performances from Sweeteners and starches as well as Bioproducts.

Agricultural Services revenue dropped 6 percent to $12.699 billion. The segment was impacted by slow farmer-selling and poor international merchandising results.

Looking ahead, Woertz said, ''...we continue to see strong global demand for our products and large crop supplies. We expect continued good utilization of our North American network until South America's large harvest reaches global markets.''

ADM closed down 1.4 percent on Monday at $38.91.