October 28, 2011

Corn Products' profits soar

The third quarter income of Corn Products International Inc. (CPO) rose on strong sales across regions and a-prior-year period that was dwindled by high acquisition costs.

The supplier of sweeteners and starches to food processors and industrial customers has successfully managed to raise prices and offset rising corn costs. At the same time, a purchase last year of specialty-food ingredient maker National Starch has boosted the company's sales volumes and margins.

"In each of our regions, we have achieved significant though appropriate price increases to offset higher input costs," Chairman and Chief Executive Ilene Gordon said Thursday (Oct 27).

Corn Products reported a profit of US$87.7 million, or US$1.12 a share, up from US$36.9 million, or US$0.48 a share, a year earlier. Excluding acquisition and restructuring-related costs, earnings rose to US$1.20 from US$0.81 a year earlier.

Net sales jumped 58% to US$1.71 billion or US$1.63 billion after shipping and handling costs. Analysts polled by Thomson Reuters expected earnings of US$1.09 a share on US$1.57 billion in revenue.

Sales in North America, the biggest top-line contributor, were up 54%, while South American sales jumped 33%. Sales in the company's Asia Pacific more than doubled while the Europe, Middle East, and Africa segment saw sales more than triple from a year earlier.

Shares closed Wednesday (Oct 26) at US$45.35 and were inactive premarket. The stock is down 1.4% since the start of the year.