February 17, 2012

Bunge's Q4 income drops; net revenue climbs

Agribusiness and food company Bunge Ltd posted a decline in fourth-quarter profit hurt by lower earnings in agribusiness, while net sales climbed on higher volumes in all divisions.

Fourth-quarter net income attributable to the company fell 15.6% to US$254 million from US$301 million in the prior-year quarter. Net income to Bunge common shareholders dropped to US$245 million from US$292 million in the previous year.

Net sales for the three-month period were US$16.45 billion, 29.2% higher than last year's US$12.73 billion, while eight analysts estimated revenues of US$13.73 billion for the quarter.

For the quarter, total segment EBIT declined to US$273 million from prior year's US$381 million mainly on lower earnings in agribusiness, despite a turnaround in Sugar & Bioenergy segment.

In agribusiness, higher oilseed processing results in Asia, Europe and South America were offset by weaker results in the US.

Edible oil products' results were flat and the segment continued to perform well with strong results in Brazil and significantly improved results in Europe when compared to the previous two quarters.

Milling products results increased on higher margins and volumes in corn milling, as well as the contribution of US rice milling business. Fertiliser results were slightly lower than last year, primarily due to a more challenging margin environment.

For fiscal 2011, attributable net profit plunged 60% to US$942 million or US$6.07 per share from prior year's US$2.35 billion or US$15.06 per share that reflected a US$2.4 billion gain on sale of fertiliser nutrients assets. Adjusted earnings grew 40.4% to US$5.80 per share and net sales climbed 28.5%to US$58.74 billion with increased volume in agribusiness and food & ingredients.

Agribusiness, edible oils and milling segments generated record full-year results, but reduced sugarcane production yields in Brazil due to back-to-back years of poor weather had a material impact on volumes in sugar & bioenergy segment.