WHITE PLAINS, N.Y.,
July 19, 2017 /PRNewswire/
-- Bunge Limited (NYSE: BG) today announced a
comprehensive global Competitiveness Program to improve its cost
position and deliver increased value to shareholders. The program,
which has been discussed over the past several quarters, will
rationalize Bunge's cost structure and reengineer the way it
operates, reducing overhead costs by approximately $250 million once fully implemented. These
savings are in addition to the savings generated through the
company's existing industrial productivity program. The company
will achieve these cost savings by aggressively adopting a
zero-based budgeting process that will target costs in specific
budget categories, simplifying its organizational structure,
streamlining processes and consolidating back office functions
globally to improve efficiency and scalability. In addition, the
company will be reducing its 2018 total capex spend from a
previously announced $750 million to $650
million.
Soren Schroder, Bunge's Chief
Executive Officer, stated, "We have a unique, irreplaceable
footprint and a strong, growing customer base that relies on us for
competitively priced, high quality products under all market
conditions. Demand and margin trends are positive, and the
Competitiveness Program is a transformational next step to
reengineer our organizational and cost structure, which will
advance our growth agenda and create significant value for our
shareholders."
The company expects the Competitiveness Program to provide
modest benefits to 2017 earnings. Approximately $100 million of the savings are anticipated to be
realized in 2018 and $180 million in
2019. Full run rate cost savings of $250
million are expected to be achieved by the end of 2019. The
company expects total non-recurring charges associated with the
program to be 0.8-1.2x of targeted savings, most of which are
expected to be cash charges spread over the next two and half
years.
Thomas Boehlert, Bunge's Chief
Financial Officer, stated, "We started the process to launch this
program in early 2017 and are now beginning implementation. I'm
confident that these steps will improve our competitiveness and
position us well as market conditions improve."
Today, the company also announced that it expects second quarter
2017 adjusted earnings to be modestly profitable, but below the low
end of the range of analyst estimates, primarily driven by
challenging global Agribusiness market conditions.
"Market conditions during the second quarter were challenging,
driven by unprecedented farmer retention in South America, which pressured margins
throughout the chain," added Schroder. "Increased farmer pricing
early in July, as well as more dynamic markets and continued strong
demand, lead us to expect much improved Agribusiness conditions in
the second half of the year."
Bunge will hold a conference call at 11:00 a.m. EDT on Thursday, July 20, 2017 to discuss the
Competitiveness Program; a slide presentation to accompany the call
will be posted on www.bunge.com.
Conference Call and Webcast Details
To listen to the call, please dial (877) 883-0383. If you are
located outside the United States
or Canada, dial (412) 902-6506.
Please dial in five to 10 minutes before the scheduled start time.
When prompted, enter confirmation code 2794944. The call will also
be webcast live at www.bunge.com.
To access the webcast, go to "Webcasts and presentations" in the
"Investors" section of the company's website. Select
"Competitiveness Program Conference Call" and follow the prompts.
Please go to the website at least 15 minutes prior to the call to
register and download any necessary audio software.
A replay of the call will be available later in the day on
July 20, 2017, continuing through
August 20, 2017. To listen to it,
please dial (877) 344-7529 in the United
States, (855) 669-9658 in Canada, or (412) 317-0088 in other locations.
When prompted, enter confirmation code 10110865. A replay will also
be available in "Past events" at "Webcasts and presentations" in
the "Investors" section of the company's website.
Website Information
We routinely post important information for investors on our
website, www.bunge.com, in the "Investors" section. We may use this
website as a means of disclosing material, non-public information
and for complying with our disclosure obligations under Regulation
FD. Accordingly, investors should monitor the Investors section of
our website, in addition to following our press
releases, SEC filings, public conference calls,
presentations and webcasts. The information contained on, or that
may be accessed through, our website is not incorporated by
reference into, and is not a part of, this document.
About Bunge Limited
Bunge Limited (www.bunge.com, NYSE: BG) is a leading global
agribusiness and food company operating in over 40 countries with
approximately 32,000 employees. Bunge buys, sells, stores and
transports oilseeds and grains to serve customers worldwide;
processes oilseeds to make protein meal for animal feed and edible
oil products for commercial customers and consumers; produces sugar
and ethanol from sugarcane; mills wheat, corn and rice to make
ingredients used by food companies; and sells fertilizer in South
America. Founded in 1818, the company is headquartered in
White Plains, New York.
Cautionary Statement Concerning Forward-Looking
Statements
This press release contains both historical and forward-looking
statements. All statements, other than statements of historical
fact are, or may be deemed to be, forward-looking statements within
the meaning of Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities Exchange Act of 1934, as
amended. These forward-looking statements are not based on
historical facts, but rather reflect our current expectations and
projections about our future results, performance, prospects and
opportunities. We have tried to identify these forward-looking
statements by using words including "may," "will," "should,"
"could," "expect," "anticipate," "believe," "plan," "intend,"
"estimate," "continue" and similar expressions. These
forward-looking statements are subject to a number of risks,
uncertainties and other factors that could cause our actual
results, performance, prospects or opportunities to differ
materially from those expressed in, or implied by, these
forward-looking statements. The following important factors, among
others, could affect our business and financial performance:
industry conditions, including fluctuations in supply, demand and
prices for agricultural commodities and other raw materials and
products used in our business; fluctuations in energy and freight
costs and competitive developments in our industries; the effects
of weather conditions and the outbreak of crop and animal disease
on our business; global and regional agricultural, economic,
financial and commodities market, political, social and health
conditions; the outcome of pending regulatory and legal
proceedings; our ability to complete, integrate and benefit from
acquisitions, dispositions, joint ventures and strategic alliances;
our ability to achieve the efficiencies, savings and other benefits
anticipated from our cost reduction, margin improvement and other
business optimization initiatives; changes in government policies,
laws and regulations affecting our business, including agricultural
and trade policies, tax regulations and biofuels legislation; and
other factors affecting our business generally. The forward-looking
statements included in this release are made only as of the date of
this release, and except as otherwise required by federal
securities law, we do not have any obligation to publicly update or
revise any forward-looking statements to reflect subsequent events
or circumstances.
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SOURCE Bunge Limited