Cargill Reports Lower Net Earnings
NEW YORK - Apr 10/13 - SNS -- Cargill reported net earnings of $445 million on ntotal revenues of $32,200 million for the third quarter ending February 28, comnpared to a net of $766 million during the same three-month period last year.
This lifted fiscal tear to date earnings to $1,830 million, compared to $1,100 million during the first thre quartrs of the previous fiscal year.
While acknolwedging the drop, Greg Page, Cargill chairman and chief executive officer, said, "Even though many of our global food ingredients businesses experienced higher input costs, they nearly matched their strong performance in last year's third quarter."
Among Cargill's five business segments, earnings in agriculture services were down largely due to the prolonged impact of last year's drought-reduced crops in North America.
Animal nutrition results were affected by Venezuela's currency devaluation in February and by difficult economic conditions in meat and dairy production in several regions.
Third-quarter earnings in origination and processing were below the prior year, with mixed results across regions.
Export demand for U.S. soybeans and meal was strong all quarter due to limited pre-harvest supplies in South America. Brazil's harvest began in February, but weather delays and logistical challenges significantly reduced soybean and soybean product exports below expectations.
Earnings in the food ingredients and applications segment were below the year-earlier period. Performance in food ingredients reflected value-creating customer solutions, good risk management and attention to costs, although the Venezuelan currency devaluation was a factor in holding results below the year-ago level.
The animal protein businesses were negatively affected in North America by high feeding costs, tight cattle supplies and an oversupplied turkey market.
Cargill's beef processing plant in Plainview, Texas, was idled in February because of the tight cattle supply brought about by years of drought in Texas and Southern Plains states. A related, one-time charge to earnings was taken. Nine-month results in global animal protein were ahead of last year.
The risk management and financial segment was moderately below last year's third quarter. Asset management activities performed well, though not as briskly as last year when financial markets rallied in response to easing in the European debt crisis.
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