Origination and processing results contributed to a 20% increase in earnings to $512 million at Cargill in the first quarter of fiscal 2016.

MINNEAPOLIS — Origination and processing results contributed to a 20% increase in earnings to $512 million at Cargill in the first quarter of fiscal 2016. Adjusted operating earnings, meanwhile, eased to $611 million from $619 million, while revenues fell 17% to $27.5 billion from $33.3 billion a year ago.

“Cargill posted a productive start to the new fiscal year, led by solid performance globally in grain and oilseeds processing and animal nutrition,” said David MacLennan, chairman and chief executive officer. “Our team ably navigated the quarter’s weather-driven agricultural commodity markets, as well as the effects of more volatile emerging markets, currency fluctuations and other macroeconomic uncertainty. Across the company, we made good headway on operational improvements aimed at strengthening business performance. The integration of ADM’s chocolate business is proceeding on target, and we are excited to welcome EWOS, a global leader in salmon nutrition, to our company.”

David MacLennan

Cargill said the Origination and Processing segment made the largest contribution to its first-quarter financials, with adjusted operating earnings up slightly from a year ago. Within the platform, combined results for the grain and oilseed supply chain businesses rose considerably, based on effective positioning in agricultural commodity markets distinguished by persistent downward trends and occasional sharp price reversals. Soybean crush results strengthened globally, Cargill said, boosted by improved capacity utilization in South America and an unusually long processing season in North America. Performance in North American farm services lagged last year’s strong first quarter, reflecting a return to more normalized levels in Canada after two large crop years, the company noted.

Results in Food Ingredients and Applications were down slightly from last year’s first quarter, though efforts to reduce costs and improve performance “showed good progress” across the segment, Cargill said.

“Profitability in starches and sweeteners was pressured in Europe by historically low sugar prices and in North America by the impact of low crude oil prices on markets for corn-based ethanol,” the company said. “Other ingredients within the segment’s portfolio also saw slippage in earnings, as did staple foods in some emerging markets. In contrast, salt results rose on new volume from last year’s purchase of a salt facility in Michigan and lower freight costs.”

Cargill said the acquisition of ADM’s chocolate business was completed in late July and integration is proceeding smoothly.

Within the Animal Nutrition and Protein segment, adjusted operating earnings decreased in the first quarter, with higher results in animal nutrition offset by lower earnings in animal protein.

“Global animal nutrition earnings exceeded last year’s solid start due to higher sales volumes of customer-aligned products and services, and good cost management,” Cargill said.

The company pointed to the United States and Vietnam as areas of particular strength. Within the segment’s animal protein businesses, poultry results in Central America, Europe and the United States rose on strong operational and marketing performance, Cargill said.

“Unseasonable pressures in cattle and beef markets led to a weaker quarter in North American beef,” the company noted. “Cattle costs remained high, and continued high beef prices caused consumers to seek less expensive alternatives such as pork and poultry.”