Milling & Baking News - February 19, 2013 - 20

Financial Results 

Oilseeds processing proﬁts boost
ADM earnings in second quarter
DECATUR, ILL. — Improved results
in the company’s Oilseeds Processing
segment coupled with the absence of
a significant write-down that occurred
in last year’s second quarter accounted
for an earnings jump at Archer Daniels
Midland Co. in the second quarter of
fiscal 2013.
Net income in the second quarter ended Dec. 31, 2012, was $510 million, equal
to 77c per share on the common stock,
up from $80 million, or 12c per share, in
the same quarter a year ago. The latest
results included 11c per share in LIFO
gains and other items that net to about 6c
per share. The prior-year results included 6c per share in LIFO charges and 33c
per share in asset impairment charges.
ADM’s adjusted earnings per share was
60c, up from 51c per share a year ago.
Net sales in the second quarter were
$24,921 million, up 7% from $23,306
million in the same period a year ago.
“The ADM team managed well despite challenges from the U.S. drought
and from persistent, negative margins
in the ethanol industry,” said Patricia
Woertz, chairman and chief executive
officer. “Our results in Oilseeds and
Agricultural Services demonstrated the
ability of our people to use our global
asset network to prepare for and manage in a range of market conditions.
“In North America, we fully utilized
our oilseeds crushing capacity to meet
strong global demand, and we adjusted
our transportation and origination network to move goods efficiently despite
constrained river traffic and a smaller
corn crop. In South America, we leveraged our origination, transportation

and export facilities to move the record corn crop to world markets. And,
in Europe, we made some operational
changes, and the market responded to
reduced imports.
“During our abbreviated fiscal year,
we drove meaningful improvements in capital, costs
and cash to enhance our
future competitiveness. We
continued taking action to
improve underperforming
businesses. As part of our
ongoing portfolio management, we sold $570 million
of non-core investments.
And, through a companywide focus,
we unlocked more than $1 billion in
working cash.”
ADM’s Oilseeds Processing segment posted a profit of $411 million,
up 97% from $209 million. Results included unfavorable mark-to-market
timing effects of about $50 million,
which compared with an unfavorable
impact of about $110 million in the
year-ago period, ADM said.
Sales and other operating income in
the Oilseeds Processing segment rose 2%
to $8,364 million. Crushing and origination operating profit totaled $261 million
in the second quarter, up 116% from a
year ago on strong improvements in all
three geographies. ADM said its U.S.
soybean operations ran at record capacity during the quarter and delivered
strong results amid good domestic and
export meal demand. ADM said cocoa
and other results increased $66 million
during the quarter, as weaker cocoa press
margins were offset by the absence of last

With large write off, Bunge net
income negligible in 2012
WHITE PLAINS, N.Y. — Income at
Bunge Ltd. declined 97% during 2012
on hefty charges. Income for the year
ended Dec. 31, 2012, was $28 million,
equal to 19c per share on the common
stock, which compared with $908 million, or $6.07 per share, during fiscal
2011. Sales for the year were $60,991
million, up 9% from $56,097 million
during fiscal 2011.
For the fourth quarter ended Dec.
31, the company sustained a loss of
$610 million, which compared with
income of $245 million during the
same quarter of the previous year. The
20 / February 19, 2013 Milling & Baking News

company had sales of $17,040 million,
up 9% from $15,692 million during the
same quarter of the previous year.
During the fourth quarter the company had after-tax charges of $683 million,
including a goodwill impairment charge
of $327 million in the sugar and bioenergy segment, provisions of $298 million
in discontinued operations relating to the
pending sale of a fertilizer business, and
a $49 million charge related to the sale of
long-term recoverable taxes.
“The fourth quarter was weaker
than expected, but looking at the full
year, agribusiness achieved record

year’s significant negative mark-to-market impacts.
Corn Processing results were weak
in the quarter on continued ethanol
industry challenges, ADM said. Operating profit for the segment during
the quarter was $3 million, which compared with a loss of $129 million a year
ago. Last year’s results included $339
million in restructuring and exit costs.
Net sales and other operating income in the segment
fell 4% to $3,041 million from
$3,158 million. Within the
segment, sweeteners and
starches profit rose 29% to
$97 million from $75 million,
but bioproducts suffered a
loss of $94 million after posting a profit of $135 million in
the second quarter of fiscal 2012.
The company’s Agricultural Services segment posted an operating profit
of $317 million, up 32% from $240
million in the second quarter of fiscal
2012. Sales and other operating income in the segment increased 14% to
$13,485 million from $11,854 million.
ADM noted milling and other results
remained steady, as the milling business continued to perform well.
The ADM Other segment recorded
an operating profit of $77 million in the
second quarter of fiscal 2013, up from
$22 million a year ago. Sales and other
operating income in the segment rose
11% to $31 million from $28 million.
For the first six months of fiscal 2013,
overall net income at ADM was $692
million, or $1.05 per share, up 28% from
$540 million, or 81c per share, in the
same period a year ago. Net sales and
other operating income was $46,729
million in the first half of fiscal 2013, up
3% from $45,208 million. MBN
EBIT of over $1 billion in a challenging, volatile period,” said Alberto
Weisser, chairman and chief executive officer.  “On an adjusted basis,
this exceeded last year’s record year
by 20%.  After a slow beginning to
the year, food and ingredients recovered and delivered a solid second
half.  And in fertilizer we took the
important strategic step of agreeing
to sell our Brazilian business for $750
million.  This divestiture will create a
more streamlined complement to our
agribusiness operations with lower
price risk. Sugar and bioenergy, however, continued to be challenged by
negative margins in our Brazilian
ethanol operations and the lingering
Continued on Page 22
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Milling & Baking News - February 19, 2013

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