MINNEAPOLIS — Both earnings and revenues for Cargill increased in the first quarter ended Aug. 31 as two segments, Animal Nutrition and Protein and Food Ingredients and Applications, reported adjusted operating earnings that were better than the first quarter of the previous year.
The other two segments, Origination and Processing and Industrial and Financial Services, saw earnings slip when compared to the previous year’s quarter.
Companywide, adjusted operating earnings were $888 million, up 7% from $827 million in the previous year’s first quarter. Net earnings on U.S. generally accepted accounting principles were $973 million, up 14% from $852 million. Revenues were $27.3 billion, up from $27.1 billion.
In Food Ingredients and Applications, cocoa and chocolate products, along with sweeteners and starches for food and other applications, led results in most regions.
In Animal Nutrition and Protein, consumer demand for beef, strong exports and more abundant cattle supplies lifted protein results in North America. Global poultry results lagged the year-ago period as weaker results in Central America trimmed strong domestic sales and exports out of Southeast Asia. Global animal nutrition nearly reached last year’s quarterly results.
Origination and Processing results were down from last year’s strong first quarter. Soybean processing in Brazil and China, as well as exports from Brazil, added to earnings.
“Although global demand for grain and oilseeds continues to grow, rising production and building global stocks during the last four crop cycles has depressed market volatility and commodity prices,” Cargill said when giving first-quarter results on Sept. 27. “The segment is working to increase productivity in its supply chain while continuing to leverage its trading and risk management capabilities to bring additional value to customers. The start-up of efficient new production lines in the segment’s oilseed processing plants in Wichita, Kas., and Fayetteville, N.C., furthered this objective.”
In industrial and financial services, earnings from iron ore and steel trading in Asia and from structured finance services in emerging and developed markets offset weaker performance elsewhere.
