April 3, 2008

 

Monsanto Q2 profit doubles on strong sales 

 

 

Monsanto Co. said Wednesday its second quarter earnings more than doubled on increasingly strong sales of corn seed and herbicide in the US.

 

However, the company's profit forecast for 2008 appeared to disappoint Wall Street as the company's shares slipped by midday.

 

Monsanto earned US$1.13 billion, or US$2.02 per share, in the three months ended February 29 from US$543 million, or 98 cents per share, in the previous year.

 

Its revenue jumped 45 percent to US$3.8 billion from US$2.6 billion on-year. The company said corn seed sales were a standout during the quarter, jumping to US$1.7 billion from US$1.2 billion during the same period a year before.

 

The results surpassed the expectations of analysts surveyed by Thomson Financial, who predicted earnings of US$1.72 per share. The analyst estimates typically exclude one-time items.

 

For the first half of the fiscal year, Monsanto earned US$1.39 billion, or US$2.48 a share, up from US$633 million, or US$1.14 a share, a year earlier. Six-month revenue rose to US$5.88 billion from US$4.15 billion.

 

The company forecast 2008 profits of between US$3.15 and US$3.25 a share on an ongoing basis.

 

Analysts polled by Thomson Financial had predicted earnings of US$3.20 a share. Monsanto's shares fell US$1.45, or 1.3 percent, to US$111.50 in midday trading after falling as low as US$105.84 earlier in the session.

 

Monsanto attributed the sales growth to increases in corn seed and traits revenue in the US, as well as higher sales of Roundup and similar herbicides in North America, Europe and Africa.

 

Monsanto president and chief executive officer Hugh Grant said between now and 2012, they are the only agriculture company that can point to consistent growth irrespective of commodity price swings, fluctuations in planted acres or the popularity of ethanol.

 

Monsanto earned US$1.79 per share in its last fiscal year ended August 31.