ADM Earnings Drop 83% in Q4

Sweeteners and starches operating profit increased $ 10 million for the quarter on higher average sweetener selling prices and lower manufacturing costs partially offset by higher net corn costs and reduced sales volumes.

5 Aug 2009 Archer Daniels Midland Company has announced net earnings of $ 1.7 billion for the year ended June 30, 2009, compared to year-prior net earnings of $ 1.8 billion. Fiscal year 2009 net sales and other operating income was $ 69 billion, just under the $ 70 billion reported the prior year. Net earnings for the fourth quarter decreased 83 % to $ 64 million. Net sales and other operating income for the quarter decreased 24 % to $ 16.5 billion.

“In the fourth quarter, we felt the impact of the global economic downturn, as we concluded a year of good performance overall. In this downturn, we used our strong balance sheet and cash flow to make strategic investments to build long-term value,” said Chairman of the Board and Chief Executive Officer Patricia Woertz. “As we look ahead, we see signs of improving demand in the various food, feed and fuel markets we serve. We remain financially strong and well positioned to capture value as global markets recover.”

Net sales and other operating income decreased 24 % to $ 16.5 billion for the quarter and decreased 1 % to $ 69.2 billion for the year. For the quarter, decreased average selling prices reduced net sales and other operating income by approximately $ 5.8 billion and were partially offset by higher sales volumes. Average selling prices decreased in line with year-over-year declines in underlying commodity costs and foreign exchange translation impacts. For the year, a decrease in net sales and other operating income of approximately 3 % resulted from lower sales volumes and was partially offset by an increase related to higher average selling prices of approximately 2%.

Segment operating profit decreased $ 569 million for the quarter and $ 988 million for the year. Corporate results increased $ 92 million for the quarter and $ 898 million for the year. Income taxes decreased $ 169 million for the quarter and increased $ 5 million for the year. Income taxes include charges resulting from a holding company restructuring related to a portion of the Company’s equity investment in Wilmar International Limited of $ 61 million and $ 158 million for the quarter and year, respectively. In addition, income taxes for the quarter and year were positively impacted by geographic mix of earnings, currency translation impacts in South America, and return to provision adjustments.

Oilseeds Processing operating profit decreased $ 148 million for the quarter and increased $ 240 million for the year. Crushing and origination results declined $ 135 million for the quarter on lower North American crush volumes and cash margins, and decreased soy crush and grain origination volumes and margins in Europe. Crushing and origination results increased $ 40 million for the year as global crushing margins improved. Yearover- year fertilizer sales volumes and margins decreased and North American crush volumes declined due to lower demand. Refining, packaging, biodiesel and other operating profit decreased $ 13 million for the quarter. Decreased European biodiesel margins and restructuring charges related to the Stratas JV negatively impacted results. Refining, packaging, biodiesel and other results increased $ 84 million for the year due to increased biodiesel sales volumes in South America, increased average margins for value-added products and asset abandonment charges of $ 27 million included in the prior year. Oilseeds results in Asia were unchanged for the quarter and increased $ 116 million for the year as the Company’s investments, principally the equity interest in Wilmar International Limited, continued to perform well.

Corn Processing operating profit decreased $ 273 million for the quarter and $ 776 million for the year. Sweeteners and starches operating profit increased $ 10 million for the quarter on higher average sweetener selling prices and lower manufacturing costs partially offset by higher net corn costs and reduced sales volumes. For the year, sweeteners and starches operating profit decreased $ 57 million due to the impacts of higher net corn costs partially offset by higher average sweetener selling prices. Bioproducts operating profit decreased $ 283 million for the quarter and decreased $ 719 million for the year. Ethanol and lysine margins declined significantly due to higher net corn costs and lower average selling prices for the quarter and year, while manufacturing costs decreased for the quarter.