Profits at Cargill Leap 66 Percent, Helped by Ingredients Businesses
05 Oct 2016 --- Cargill has reported profits up 66 percent year-on-year in the first quarter, helped by improved profits across starches, sweeteners and its enhanced chocolate business. The US food giant has reported profits were up 66 percent to $852m while revenues were around flat at $27.1bn.
Across its Food Ingredients business, Cargill said its chocolate and cocoa products helped lift earnings in the division, which grew last year after Cargill bought ADM'S chocolate business for $440m.
Starches, sweeteners, edible oils also performed well though profits were dented by a shortage of mid-crop cocoa beans in Ghana.
Salt earnings were flat, with a good performance in salts for food and other applications offset by less demand for road salt and deicing products in the quarter.
Cargill's Animal Nutrition & Protein division was the biggest contributor to its earnings, driven by its beef business while poultry and egg processing also performed well. Asia and North America were standout performers for Animal Nutrition.
Profits from Cargill's Origination & Processing division grew "moderately" year-on-year, helped by improved soybean margins and a good performance in its Brazilian and North American grain exports operations.
Cargill has been looking to restructure its business through acquisitions and disposals in a bid to improve declining profits.
Last year, it sold its pork business in the US for $1.45bn to Brazil's JBS SA, the world's largest meatpacker, and entered the salmon feed market.
David MacLennan, Cargill’s chairman and chief executive officer, highlighted the performance of new businesses in its results.
He said: "These actions are making us more competitive and equipping us to serve a broadening range of customer needs.”
“We posted a strong start to the new fiscal year “We’ve been charting a new path to higher performance, and it’s rewarding to see the many changes we’ve made resulting in gains across much of the company.”
