September 14, 2009

Viterra Inc, Canada's largest grain handler, reported a nearly 28-percent drop in quarterly earnings Friday (Sept 11).

Weak demand for fertiliser at lower prices than a year earlier, and lower margins on sales of agricultural chemicals drove down revenue in Viterra's agri-products segment by seven percent to C$938.7 million (US$865.8 million) in the quarter.

Viterra said it earned C$120.7 million (US$112 million), or 51 Canadian cents a share in its third quarter, down from a profit of C$166.7 million (US$153.7 million), or 71 Canadian cents a share, in the year earlier quarter.

Analysts had expected Viterra to report earnings of 57 cents a share, according to Reuters Estimates.

Farmers held off on the fertiliser side, but that should be picking up again next spring on yield demand, said analyst David Newman of National Bank Financial.

Overall revenue was C$2.2 billion (US$2.03 billion), in line with last year's quarter, helped by a 12-percent increase in grain-handling and marketing revenues to a total of C$1.1 billion (US$1.01 billion).

Viterra had successfully navigated through the global financial crisis, Chief Executive Mayo Schmidt said.

Viterra shipped 26.3-percent more grain than it did a year earlier, reflecting last autumn's bumper harvest.

The third quarter is the period during which Viterra makes most of its fertiliser and grain-handling sales, typically making it a strong quarter.

Viterra shares were up 0.9 percent at C$9.70 (US$8.95) on the Toronto Stock Exchange early Friday (Sept 11).

US$1 = C$1.08 (Sept 14)