Cargill reports third-quarter fiscal 2011 earnings

by Editor fleischwirtschaft.com
Thursday, April 14, 2011

Cargill reported $763 million in earnings from continuing operations in the fiscal 2011 third quarter ended Feb. 28, up 30% from $588 million in the same period a year ago.

The company recorded $342 million attributable to its majority investment in The Mosaic Company – income now classified as earnings from discontinued operations following the two companies' Jan. 18, 2011, announced agreement and upcoming closing of a split-off and orderly distribution of Cargill's 64% ownership stake in Mosaic. Earnings from discontinued operations in the year-ago period were $310 million, of which $141 million was attributable to Mosaic. Cargill's third-quarter net earnings totaled $1.11 billion, up 23% from $898 million in the prior year.

In the first nine months, earnings from continuing operations were $2.29 billion, a 47% increase from a year ago. The addition of $1.19 billion in earnings from discontinued operations brought Cargill's nine-month net income to $3.48 billion compared with $1.91 billion in the year-ago period. Consolidated revenues excluding Mosaic rose 21% to $30.5 billion in the third quarter, bringing the total through the first nine months to $84.7 billion.

Four of Cargill's five business segments increased earnings in the third quarter. Results were led by the origination and processing segment, which used its global sourcing and risk management capabilities to fulfill customers' supply needs in spite of market disruptions. Food ingredients and applications, a segment that connects 40 food ingredient and meat businesses, increased earnings moderately. Many business units relied on operational efficiencies and price risk management to make up for higher input costs.

Results in the risk management and financial segment improved from a year ago, reflecting better performance in stronger financial markets and in risk-sensitive energy markets. Industrial earnings also strengthened seasonally. Although earnings were down slightly, the agriculture services segment benefited from farm customers' demand for grain marketing and price risk management services.
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