Posted on September, 28, 2018 at 11:07 am
By Jeff Gelski
MINNEAPOLIS, MINNESOTA, U.S. — The Origination & Processing segment was the only one of four Cargill business segments to post an increase in adjusted operating earnings in the first quarter ended Aug. 31 when compared to last year’s strong first quarter.
Adjusted operating earnings of $883 million companywide were down 0.6% from $888 million in the previous year’s first quarter. Net earnings rose 5% to $1.020 billion from $973 million, and net revenues also climbed 5%, to $28.7 billion.
Earnings in Origination & Processing were up appreciably from last year’s weak first quarter in that segment.
“Global demand was strong and markets volatile as weather events in key crop-growing regions and rising economic uncertainty brought the segment’s sourcing, trading, analytical and logistical skills to the fore,” Cargill said when giving results Sept. 27.
Solid oilseed processing results in canola, soybeans and biodiesel were realized in North America and Europe.
In the Food Ingredients & Applications segment, earnings were slightly lower when compared to last year’s strong first quarter. Cocoa, chocolate, edible oils and malt posted gains. Earnings in starches, sweeteners and texturizers were affected negatively in North America by lower ethanol prices and trading results and in emerging markets by currency devaluations.
Adjusted operating earnings in Animal Nutrition & Protein also came in below last year’s strong quarter. North American protein performed well. Demand remained strong for domestic and international beef and for value-added egg products used in food service. Excess supply weighed down the U.S. turkey meat market. Earnings in animal nutrition lagged the earnings of the previous year’s quarter because of higher input costs, lower sales volumes and pricing pressures in different countries.
Results in Industrial & Financial Services trailed the results of the previous year’s first quarter because of lower returns from Cargill’s asset management activities. A good performance came from trade finance and commodity risk management, where teams helped Cargill customers steer through volatility that returned to the global commodities market.
Source: WORLD-GRAIN.COM