Leading food processing company
Archer Daniels Midland Company's
) fourth-quarter 2012 earnings per share of 38 cents was way behind
the Zacks Consensus Estimate of 62 cents. Quarterly earnings also
slipped was down 44.9% from the year-ago earnings of 69 cents per
share mainly driven by a decline in segment operating income,
offset by lower corporate expenses.
The company's fiscal 2012 earnings of $2.25 per share, down
34.8% from the year-ago earnings and missed the Zacks Consensus
Estimate of $2.48.
On a reported basis, including a LIFO credit of 5 cents,
quarterly earnings were down roughly 25.9% to 43 cents per share
from the prior-period earnings of 86 cents per share. For the full
year, earnings per share were $1.84 compared with $3.13 in fiscal
Archer Daniels' quarterly net sales dipped 0.9% year over year
to $22,675 million, slightly above the Zacks Consensus Estimate of
$22,382 million. The year-over-year growth in net sales was mainly
attributable to a 4.8% rise in processed volumes. Volumes in the
quarter totaled 15,509 thousand metric tons.
Further, a 4.4% rise in Oilseeds Processing revenues to $9,663
million, offset by a 0.5% decline in Corn Processing revenues to
$2,828 million and a 5.5% decline in Agricultural Services to
$10,147 million drove the upside.
Net sales for the year jumped 10.4% to $89,038 million compared
with $80,676 million in fiscal 2011. Yearly sales also surpassed
the Zacks Consensus Estimate of $88,614 million.
Archer Daniels reported total segment operating profit of $416
million, down 45.5% from the year-ago quarter, driven by reduced
operating income at all the segments.
On a segmental basis, operating profit for
segment declined $222 million to $123 million due to tight U.S.
crop supplies which affected both export volumes and U.S.
segment's operating profit reflected a fall of $48 million to $74
million in the fourth quarter. The decline was attributed to better
sweeteners and starches operating profit more than offset by weak
segment recorded fourth-quarter operating profit of $331 million
compared with an operating profit of $449 million in the year-ago
period. The $118 million decline was driven by the lack timing
gains that were availed in the year-ago quarter and weaker results
in cocoa and other.
Operating profit from the
segment came in at $16 million, up $11 million from last year. The
upside was driven by lower captive insurance loss reserves, and
better results at ADM Investor Services.
Archer Daniels ended the year with $1,291 million in cash and
cash equivalents compared with $615 million at the end of fiscal
2011. At year-end, long term debt was $8,212 million. Shareholder's
equity as of June 30, 2012 was $18,169 million.
Looking ahead, Archer Daniels expects to compensate for the
reduction in the potential size of the U.S. corn crop by developing
other crops in North America and Europe.
Archer Daniels, which competes with
Tyson Foods Inc.
), currently has a Zacks #5 Rank, implying a short-term 'Strong
Sell' rating on the stock. However, the company retains a long-term
ARCHER DANIELS (ADM): Free Stock Analysis
BUNGE LTD (BG): Free Stock Analysis Report
TYSON FOODS A (TSN): Free Stock Analysis Report
To read this article on Zacks.com click here.