WHITE PLAINS, N.Y.,
Aug. 2, 2017 /PRNewswire/
-- Bunge Limited (NYSE: BG)
- Q2 GAAP EPS of $0.48 vs.
$0.81 last year; $0.17 vs. $0.79 on
an adjusted basis
- Agribusiness impacted by weak margins and slow farmer
selling in South America
- Food & Ingredients results as expected, driven by
improved Edible Oils
- Sugar & Bioenergy benefitted from higher hedged sugar
prices
- Combined Agri-Foods trailing four quarter ROIC of 6.1%; 0.9
points below WACC
- Announced $250 million
Competitiveness Program
- Expect significant improvement in the second half of the
year
Financial Highlights
|
Quarter
Ended
|
Six Months
Ended
|
US$ in millions,
except per share
data
|
6/30/17
|
6/30/16
|
6/30/17
|
6/30/16
|
Net income
attributable to Bunge
|
$81
|
$121
|
$128
|
$356
|
|
|
|
|
|
Net income (loss)
per common share from
continuing operations-diluted
|
$0.48
|
$0.81
|
$0.79
|
$2.43
|
|
|
|
|
|
Net income (loss)
per common share from
continuing operations-diluted, adjusted
(a)
|
$0.17
|
$0.79
|
$0.52
|
$2.23
|
Total Segment
EBIT (a)
|
$73
|
$205
|
$206
|
$527
|
Certain gains &
(charges) (b)
|
$(6)
|
$(12)
|
$(12)
|
$(12)
|
Total Segment EBIT,
adjusted (a)
|
$79
|
$217
|
$218
|
$539
|
Agribusiness
(c)
|
$18
|
$180
|
$127
|
$462
|
Oilseeds
|
$2
|
$56
|
$94
|
$194
|
Grains
|
$16
|
$124
|
$33
|
$268
|
Food & Ingredients
(d)
|
$44
|
$35
|
$89
|
$87
|
Sugar &
Bioenergy
|
$14
|
$-
|
$3
|
$(14)
|
Fertilizer
|
$3
|
$2
|
$(1)
|
$4
|
|
|
|
|
|
(a)
|
Total Segment
earnings before interest and tax ("Total Segment EBIT"); Total
Segment EBIT, adjusted; net income (loss) per common share from
continuing operations-diluted, adjusted funds from operations and
ROIC are non-GAAP financial measures. Reconciliations
to the most directly comparable U.S. GAAP measures are included in
the tables attached to this press release and the accompanying
slide presentation posted on Bunge's website.
|
(b)
|
Certain gains
& (charges) included in Total Segment EBIT. See
Additional Financial Information for detail.
|
(c)
|
See footnote 8 of
Additional Financial Information for a description of the Oilseeds
and Grains businesses in Bunge's Agribusiness
segment.
|
(d)
|
Includes Edible
Oil Products and Milling Products
segments.
|
Overview
Soren Schroder, Bunge's Chief
Executive Officer, stated, "Weak global margins and slower than
expected farmer selling in South
America led to a challenging second quarter in Agribusiness.
Food & Ingredients results were as expected, driven by
significantly improved results in Edible Oils. Sugar &
Bioenergy benefitted from higher hedged sugar prices and improved
operational efficiencies. The rolling four quarter ROIC for our
core Agribusiness and Food operations was 6.1%, 0.9 points below
our WACC, reflecting the tough market conditions,
"We are optimistic about a much better second half of the year,
but some market headwinds will persist. Global trade remains
strong, opportunities are emerging from recent weather concerns in
North America and farmers in
Brazil are proving willing sellers
as prices have increased. While consumption of soy meal and oil is
strong, the crushing industry oversupplied the market during the
second quarter, resulting in a meal surplus that is expected to
weigh on margins through the third quarter.
In Food & Ingredients, Edible Oils is on track and should
significantly exceed last year's result. However, our Milling
business, particularly in Brazil,
is facing headwinds from contraction in flour consumption both in
the industrial and food service segments. Sugar & Bioenergy
should continue to benefit from strong operational performance and
hedges, and will have a strong second half of the year.
"Recently, we announced a global Competitiveness Program to
lower costs, increase efficiencies and reengineer the way we work.
We expect this program to reduce overhead costs by $250 million by the end of 2019 with $100 million of savings expected in 2018. This is
a transformational next step that will significantly boost our
competitiveness as market conditions improve, and builds on our
existing industrial productivity program, which has delivered
$43 million of benefits year-to-date
toward our full year estimate of $100
million."
Second Quarter Results
Agribusiness
Lower results in the quarter were
primarily driven by slow farmer selling in South America that negatively impacted margins
throughout the value chain. In Grains, Brazil was the primary driver of decreased
results, due to the combination of farmer retention and intense
industry competition for supply to meet logistics commitments. In
grain trading & distribution, lower results reflected ample
global grain supplies and a largely spot customer that limited
forward merchandising opportunities. Higher volumes were primarily
attributed to increased exports out of the U.S., which, despite
being in its seasonally slow period, remained competitive with
South America for much of the
quarter.
In Oilseeds, soy processing results were down in all
regions. In South America, lower margins were driven by a
combination of slow farmer selling and an oversupply of soybean
meal. In the U.S., results were lower than a particularly strong
prior year that benefitted from harvest delays and production
shortfalls in South America. In
China, margins were impacted by
industry overcapacity. Partially offsetting these lower
results were higher softseed processing results in Canada, which compared favorably to a
challenging prior year period where seed supply was tight. Results
in oilseed trading & distribution were higher than last year,
reflecting increased volumes, margins and contributions from risk
management. Oilseed results in the quarter were impacted by
$11 million of mark-to-market hedging
losses, whereas, results in 2016 included approximately
$40 million of mark-to-market hedging
gains.
Edible Oil Products
Results improved in all regions
compared to last year, with the largest increases in Europe and the U.S. Europe benefitted from an increase in margins
and volumes, as well as contributions from new acquisitions, which
enhanced our mix of higher value added products and expanded our
customer base. In the U.S., reduced costs more than offset lower
refining margins and volumes. In Brazil, slightly better results were driven by
increased volume and margins; however, volumes of specialty oils
and other higher margin products continued to be depressed due to
challenging macro-economic conditions. In Asia, higher results were primarily due to
growth in sales of higher margin products in India. Second quarter 2016 results included a
reversal of an approximately $12
million mark-to-market gain.
Milling Products
The decline in segment performance
was mainly driven by Brazil and
Mexico. In Brazil, the region with the largest
year-over-year variance, results were impacted by lower volumes and
margins as consumers continued to trade down to lower value
products and an overall decline in flour consumption in both the
food service and food processor channels. Also impacting results in
Brazil was aggressive pricing by
small mills, which increased production in response to the larger
than normal Brazilian wheat crop. In Mexico, results were impacted by a decrease in
margins, delays in passing through higher raw material costs in
local currency due to competitive pressures and unfavorable
currency translation. However, results improved in Mexico from the first quarter, and we expect
further improvement in both regions as we progress through the
year. U.S. milling was steady with a promising outlook for the
second half of the year.
Sugar & Bioenergy
Increased results in the quarter
were primarily driven by our sugarcane milling operation, which
benefitted from higher sugar volumes and production that was hedged
at higher prices than last year. Despite prolonged periods of wet
weather during the quarter, crushing volumes and ATR were higher
than last year due to improved industrial and farming performance.
Results in our biofuel joint ventures were higher, reflecting
increased ethanol margins in Argentina. Results in the quarter were
impacted by a $6 million loss from
our renewable oils joint venture.
Fertilizer
Higher results in the quarter, were driven
by slight improvements in Argentina and Brazil. Typically, the
first and second quarters are seasonal low points for fertilizer
volumes as a result of the South American agricultural growing
cycle.
Cash Flow
Cash used for operations in the six months
ended June 30, 2017 was $477 million compared to cash used of
$684 million in the same period last
year. The year-over-year variance primarily reflects positive
changes in working capital offset in part by lower earnings.
Income Taxes
Excluding approximately $49 million of notable tax benefits, the
effective tax rate for the six months ended June 30, 2017 was approximately 20%.
Outlook
Thom Boehlert, Chief Financial
Officer, stated, "Overall, we expect a much improved second half of
the year. In Agribusiness, the third quarter is off to a good
start. While South American soy crush margins have expanded, they,
along with soy crush margins in Europe, are still below our earlier
expectations. As a result, we are adjusting our full-year 2017 EBIT
range to $550 million to $650
million, weighted to the fourth quarter.
"In Food & Ingredients, we expect Edible Oils to continue to
show strong year-over-year improvement on higher volumes and
margins. However, due to challenging first half conditions in
Milling, and in anticipation of continued soft consumer demand in
Brazil and Mexico, we are adjusting our full-year 2017
EBIT range to $210 million to $230
million, weighted to the fourth quarter.
"In Sugar & Bioenergy, we are entering the seasonally strong
period of the year when ATR yields rapidly increase. Our sugarcane
milling operations are trending well, and the segment remains on
target to achieve full-year EBIT of $100 to
$120 million assuming normal weather patterns. Results will
be weighted toward the fourth quarter, reflecting seasonally
tighter ethanol supply.
"In Fertilizer, we continue to expect 2017 segment EBIT to be
approximately $25 million.
"We expect our full-year 2017 tax rate, excluding notables, to
be 18% to 22%, which is more favorable than our previous
expectation of 23% to 27%, primarily due to our forecasted earnings
mix."
Conference Call and Webcast Details
Bunge Limited's management will host a conference call at
8:00 a.m. EDT on Wednesday, August 2, 2017 to discuss the
company's results.
Additionally, a slide presentation to accompany the discussion
of results will be posted on www.bunge.com.
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
1311073. 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 "Q2 2017
Bunge Limited 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
August 2, 2017, continuing through
September 2, 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
10110278. 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.
Additional Financial Information
The following table provides a summary of certain gains and
charges that may be of interest to investors. The table includes a
description of these items and their effect on net income (loss)
attributable to Bunge, earnings per share diluted and continuing
operations for total segment EBIT for the quarters and six months
ended June 30, 2017 and 2016.
|
Net Income
(loss)
|
Earnings
|
|
|
|
Attributable
to
|
Per
Share
|
Total
Segment
|
|
(US$ in millions,
except per share data)
|
Bunge
|
Diluted
|
EBIT
|
|
Quarter Ended June
30:
|
2017
|
2016
|
2017
|
2016
|
2017
|
2016
|
|
Continuing
operations:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Agribusiness:
|
$
|
-
|
$
|
(8)
|
$
|
-
|
$
|
(0.06)
|
$
|
-
|
$
|
(12)
|
|
Impairment of
intangible assets (1)
|
|
-
|
|
(8)
|
|
-
|
|
(0.06)
|
|
-
|
|
(12)
|
|
Sugar &
Bioenergy:
|
$
|
(6)
|
$
|
-
|
$
|
(0.04)
|
$
|
-
|
$
|
(6)
|
$
|
-
|
|
Restructuring charges
(2)
|
|
(6)
|
|
-
|
|
(0.04)
|
|
-
|
|
(6)
|
|
-
|
|
Income
Taxes:
|
$
|
49
|
$
|
11
|
$
|
0.35
|
$
|
0.08
|
$
|
-
|
$
|
-
|
|
Income tax benefits
(charges) (3)
|
|
49
|
|
11
|
|
0.35
|
|
0.08
|
|
-
|
|
-
|
|
Total
|
$
|
43
|
$
|
3
|
$
|
0.31
|
$
|
0.02
|
$
|
(6)
|
$
|
(12)
|
|
|
|
|
|
|
Net
Income
|
Earnings
|
|
|
|
Attributable
to
|
Per
Share
|
Total
Segment
|
|
(US$ in millions,
except per share data)
|
Bunge
|
Diluted
|
EBIT
|
|
Six Months Ended
June 30:
|
2017
|
2016
|
2017
|
2016
|
2017
|
2016
|
|
Continuing
operations:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Agribusiness:
|
$
|
-
|
$
|
(8)
|
$
|
-
|
$
|
(0.05)
|
$
|
-
|
$
|
(12)
|
|
Impairment of intangible assets (1)
|
|
-
|
|
(8)
|
|
-
|
|
(0.05)
|
|
-
|
|
(12)
|
|
Sugar &
Bioenergy:
|
$
|
(12)
|
$
|
-
|
$
|
(0.08)
|
$
|
-
|
$
|
(12)
|
$
|
-
|
|
Restructuring charges
(2)
|
|
(12)
|
|
-
|
|
(0.08)
|
|
-
|
|
(12)
|
|
-
|
|
Income
Taxes:
|
$
|
49
|
$
|
39
|
$
|
0.35
|
$
|
0.25
|
$
|
-
|
$
|
-
|
|
Income tax benefits
(charges) (3)
|
|
49
|
|
39
|
|
0.35
|
|
0.25
|
|
-
|
|
-
|
|
Total
|
$
|
37
|
$
|
31
|
$
|
0.27
|
$
|
0.20
|
$
|
(12)
|
$
|
(12)
|
|
Consolidated
Earnings Data (Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
Quarter
Ended
|
|
|
Six Months
Ended
|
|
June
30,
|
|
|
June
30,
|
(In
millions)
|
|
2017
|
|
2016
|
|
|
|
2017
|
|
2016
|
Net sales
|
$
|
11,645
|
$
|
10,541
|
|
|
$
|
22,766
|
$
|
19,457
|
Cost of goods
sold
|
|
(11,290)
|
|
(10,011)
|
|
|
|
(21,951)
|
|
(18,307)
|
Gross
profit
|
|
355
|
|
530
|
|
|
|
815
|
|
1,150
|
Selling, general and
administrative expenses
|
|
(328)
|
|
(303)
|
|
|
|
(706)
|
|
(617)
|
Foreign exchange
gains (losses)
|
|
51
|
|
(6)
|
|
|
|
107
|
|
15
|
Other income
(expense)−net
|
|
2
|
|
(13)
|
|
|
|
(1)
|
|
(18)
|
EBIT attributable to
noncontrolling interest (a) (5)
|
|
(7)
|
|
(3)
|
|
|
|
(9)
|
|
(3)
|
Total Segment EBIT
(4)
|
|
73
|
|
205
|
|
|
|
206
|
|
527
|
Interest
income
|
|
8
|
|
14
|
|
|
|
20
|
|
24
|
Interest
expense
|
|
(62)
|
|
(59)
|
|
|
|
(127)
|
|
(116)
|
Income tax (expense)
benefit (3)
|
|
55
|
|
(39)
|
|
|
|
27
|
|
(73)
|
Noncontrolling
interest share of interest and tax (a) (5)
|
|
1
|
|
4
|
|
|
|
2
|
|
7
|
Income from
continuing operations, net of tax
|
|
75
|
|
125
|
|
|
|
128
|
|
369
|
Income (loss) from
discontinued operations, net of tax
|
|
6
|
|
(4)
|
|
|
|
-
|
|
(13)
|
Net income
attributable to Bunge (5)
|
|
81
|
|
121
|
|
|
|
128
|
|
356
|
Convertible
preference share dividends and other obligations
|
|
(9)
|
|
(12)
|
|
|
|
(17)
|
|
(25)
|
Net income
available to Bunge common shareholders
|
$
|
72
|
$
|
109
|
|
|
$
|
111
|
$
|
331
|
Net income (loss)
per common share diluted attributable
to Bunge common shareholders (6):
|
|
|
|
|
|
|
|
|
|
|
Continuing
operations
|
$
|
0.48
|
$
|
0.81
|
|
|
$
|
0.79
|
$
|
2.43
|
Discontinued
operations
|
|
0.03
|
|
(0.03)
|
|
|
|
-
|
|
(0.09)
|
Net income (loss)
per common share - diluted
|
$
|
0.51
|
$
|
0.78
|
|
|
$
|
0.79
|
$
|
2.34
|
Weighted–average
common shares outstanding - diluted
|
|
141
|
|
140
|
|
|
|
141
|
|
148
|
|
|
|
|
|
|
|
|
|
|
|
(a) The line items
"EBIT attributable to noncontrolling interest" and "Noncontrolling
interest share of interest and tax" when combined represent
consolidated Net loss (income) attributed to noncontrolling
interests on a GAAP basis of presentation.
|
|
|
|
|
|
Consolidated
Segment Information (Unaudited)
|
Set forth below is a
summary of certain earnings data and volumes by reportable
segment.
|
|
|
Quarter
Ended
|
|
Six Months
Ended
|
|
June
30,
|
|
June
30,
|
(In millions,
except volumes)
|
|
2017
|
|
2016
|
|
|
2017
|
|
2016
|
Volumes (in
thousands of metric tons):
|
|
|
|
|
|
|
|
|
|
Agribusiness
|
|
36,173
|
|
33,944
|
|
|
71,196
|
|
66,697
|
Edible Oil
Products
|
|
1,947
|
|
1,742
|
|
|
3,736
|
|
3,344
|
Milling
Products
|
|
1,099
|
|
1,136
|
|
|
2,173
|
|
2,242
|
Sugar &
Bioenergy
|
|
2,134
|
|
2,116
|
|
|
3,981
|
|
4,039
|
Fertilizer
|
|
246
|
|
249
|
|
|
408
|
|
415
|
|
|
|
|
|
|
|
|
|
|
Net
sales:
|
|
|
|
|
|
|
|
|
|
Agribusiness
|
$
|
8,298
|
$
|
7,524
|
|
$
|
16,117
|
|
13,807
|
Edible Oil
Products
|
|
1,970
|
|
1,705
|
|
|
3,850
|
|
3,231
|
Milling
Products
|
|
390
|
|
422
|
|
|
772
|
|
813
|
Sugar &
Bioenergy
|
|
906
|
|
809
|
|
|
1,894
|
|
1,467
|
Fertilizer
|
|
81
|
|
81
|
|
|
133
|
|
139
|
Total
|
$
|
11,645
|
$
|
10,541
|
|
$
|
22,766
|
|
19,457
|
Gross
profit:
|
|
|
|
|
|
|
|
|
|
Agribusiness
|
$
|
157
|
$
|
343
|
|
$
|
435
|
|
773
|
Edible Oil
Products
|
|
111
|
|
87
|
|
|
234
|
|
199
|
Milling
Products
|
|
48
|
|
68
|
|
|
96
|
|
123
|
Sugar &
Bioenergy
|
|
33
|
|
25
|
|
|
42
|
|
41
|
Fertilizer
|
|
6
|
|
7
|
|
|
8
|
|
14
|
Total
|
$
|
355
|
$
|
530
|
|
$
|
815
|
|
1,150
|
Selling, general
and administrative expenses:
|
|
|
|
|
|
|
|
|
|
Agribusiness
|
$
|
(177)
|
$
|
(160)
|
|
$
|
(398)
|
|
(337)
|
Edible Oil
Products
|
|
(85)
|
|
(82)
|
|
|
(171)
|
|
(161)
|
Milling
Products
|
|
(33)
|
|
(32)
|
|
|
(70)
|
|
(61)
|
Sugar &
Bioenergy
|
|
(27)
|
|
(24)
|
|
|
(56)
|
|
(49)
|
Fertilizer
|
|
(6)
|
|
(5)
|
|
|
(11)
|
|
(9)
|
Total
|
$
|
(328)
|
$
|
(303)
|
|
$
|
(706)
|
|
(617)
|
Foreign exchange
gain (loss):
|
|
|
|
|
|
|
|
|
|
Agribusiness
|
$
|
43
|
$
|
(4)
|
|
$
|
92
|
$
|
20
|
Edible Oil
Products
|
|
1
|
|
(1)
|
|
|
4
|
|
(2)
|
Milling
Products
|
|
(1)
|
|
(4)
|
|
|
(1)
|
|
(5)
|
Sugar &
Bioenergy
|
|
4
|
|
3
|
|
|
9
|
|
3
|
Fertilizer
|
|
4
|
|
-
|
|
|
3
|
|
(1)
|
Total
|
$
|
51
|
$
|
(6)
|
|
$
|
107
|
$
|
15
|
Segment
EBIT:
|
|
|
|
|
|
|
|
|
|
Agribusiness
|
$
|
18
|
$
|
168
|
|
$
|
127
|
$
|
450
|
Edible Oil
Products
|
|
28
|
|
2
|
|
|
64
|
|
32
|
Milling
Products
|
|
16
|
|
33
|
|
|
25
|
|
55
|
Sugar &
Bioenergy
|
|
8
|
|
-
|
|
|
(9)
|
|
(14)
|
Fertilizer
|
|
3
|
|
2
|
|
|
(1)
|
|
4
|
Total
(4)
|
$
|
73
|
$
|
205
|
|
$
|
206
|
$
|
527
|
|
|
|
|
|
|
|
|
Condensed
Consolidated Balance Sheets (Unaudited)
|
|
|
|
June
30,
|
|
|
December
31,
|
(US$ in
millions)
|
|
2017
|
|
|
2016
|
Assets
|
|
|
|
|
|
|
|
Cash and cash
equivalents
|
|
$
|
575
|
|
|
$
|
934
|
Time deposits under
trade structured finance program
|
|
|
-
|
|
|
|
64
|
Trade accounts
receivable, net
|
|
|
1,747
|
|
|
|
1,676
|
Inventories
(7)
|
|
|
5,454
|
|
|
|
4,773
|
Other current
assets
|
|
|
4,138
|
|
|
|
3,645
|
Total current
assets
|
|
|
11,914
|
|
|
|
11,092
|
Property, plant and
equipment, net
|
|
|
5,331
|
|
|
|
5,099
|
Goodwill and other
intangible assets, net
|
|
|
866
|
|
|
|
709
|
Investments in
affiliates
|
|
|
426
|
|
|
|
373
|
Time deposits under
trade structured finance program
|
|
|
411
|
|
|
|
464
|
Other non-current
assets
|
|
|
1,485
|
|
|
|
1,451
|
Total
assets
|
|
$
|
20,433
|
|
|
$
|
19,188
|
Liabilities and
Equity
|
|
|
|
|
|
|
|
Short-term
debt
|
|
$
|
1,274
|
|
|
$
|
257
|
Current portion of
long-term debt
|
|
|
206
|
|
|
|
938
|
Letter of credit
obligations under trade structured finance program
|
|
|
411
|
|
|
|
528
|
Trade accounts
payable
|
|
|
3,513
|
|
|
|
3,485
|
Other current
liabilities
|
|
|
2,529
|
|
|
|
2,476
|
Total current
liabilities
|
|
|
7,933
|
|
|
|
7,684
|
Long-term
debt
|
|
|
3,918
|
|
|
|
3,069
|
Other non-current
liabilities
|
|
|
1,147
|
|
|
|
1,092
|
Total
liabilities
|
|
|
12,998
|
|
|
|
11,845
|
Total
equity
|
|
|
7,435
|
|
|
|
7,343
|
Total liabilities
and equity
|
|
$
|
20,433
|
|
|
$
|
19,188
|
|
|
|
|
|
|
|
Condensed
Consolidated Statements of Cash Flows (Unaudited)
|
|
|
Six Months
Ended
|
|
June
30,
|
(US$ in
millions)
|
|
2017
|
|
|
|
2016
|
Operating
Activities
|
|
|
|
|
|
|
Net income (loss)
(5)
|
$
|
135
|
|
|
$
|
352
|
Adjustments to
reconcile net income (loss) to cash provided by (used for)
operating activities:
|
|
|
|
|
|
|
Foreign exchange loss
(gain) on net debt
|
|
(33)
|
|
|
|
118
|
Depreciation,
depletion and amortization
|
|
282
|
|
|
|
254
|
Deferred income
taxes
|
|
(2)
|
|
|
|
82
|
Other, net
|
|
43
|
|
|
|
60
|
Changes in operating
assets and liabilities, excluding the effects of
acquisitions:
|
|
|
|
|
|
|
Trade accounts
receivable, net
|
|
(93)
|
|
|
|
39
|
Inventories
|
|
(532)
|
|
|
|
(1,250)
|
Secured advances to
suppliers
|
|
125
|
|
|
|
265
|
Advances on
sales
|
|
(149)
|
|
|
|
(106)
|
Net unrealized
gain/loss on derivative contracts
|
|
(36)
|
|
|
|
34
|
Margin
deposits
|
|
(45)
|
|
|
|
(117)
|
Trade accounts
payable and accrued liabilities
|
|
98
|
|
|
|
(272)
|
Other, net
|
|
(270)
|
|
|
|
(143)
|
Cash provided by
(used for) operating activities
|
|
(477)
|
|
|
|
(684)
|
Investing
Activities
|
|
|
|
|
|
|
Payments made for
capital expenditures
|
|
(342)
|
|
|
|
(275)
|
Acquisitions of
businesses (net of cash acquired)
|
|
(394)
|
|
|
|
-
|
Proceeds from
investments
|
|
119
|
|
|
|
449
|
Payments for
investments
|
|
(160)
|
|
|
|
(436)
|
Settlement of net
investment hedges
|
|
(3)
|
|
|
|
(115)
|
Payments for
investments in affiliates
|
|
(68)
|
|
|
|
(20)
|
Other, net
|
|
9
|
|
|
|
(20)
|
Cash provided by
(used for) investing activities
|
|
(839)
|
|
|
|
(417)
|
Financing
Activities
|
|
|
|
|
|
|
Net borrowings
(repayments) of short-term debt
|
|
1,001
|
|
|
|
1,007
|
Net proceeds
(repayments) of long-term debt
|
|
19
|
|
|
|
547
|
Repurchases of common
shares
|
|
-
|
|
|
|
(200)
|
Proceeds from the
exercise of option for common shares
|
|
57
|
|
|
|
-
|
Dividends
paid
|
|
(135)
|
|
|
|
(124)
|
Other, net
|
|
(6)
|
|
|
|
(18)
|
Cash provided by
(used for) financing activities
|
|
936
|
|
|
|
1,212
|
Effect of exchange
rate changes on cash and cash equivalents
|
|
21
|
|
|
|
26
|
Net increase
(decrease) in cash and cash equivalents
|
|
(359)
|
|
|
|
137
|
Cash and cash
equivalents, beginning of period
|
|
934
|
|
|
|
411
|
Cash and cash
equivalents, end of period
|
$
|
575
|
|
|
$
|
548
|
Definition and Reconciliation of Non-GAAP Measures
This earnings release contains certain "non-GAAP financial
measures" as defined in Regulation G of the Securities Exchange Act
of 1934. Bunge has reconciled these non-GAAP financial measures to
the most directly comparable U.S. GAAP measures below. These
measures may not be comparable to similarly titled measures used by
other companies.
Total Segment EBIT and Total Segment EBIT, adjusted
Bunge uses total segment earnings before interest and taxes
("Total Segment EBIT") to evaluate Bunge's operating performance.
Total Segment EBIT is the aggregate of each of our five reportable
segments' earnings before interest and taxes. Total Segment EBIT,
adjusted, is calculated by excluding certain gains and charges as
described above in "Additional Financial Information" from Total
Segment EBIT. Total Segment EBIT and Total Segment EBIT,
adjusted are non-GAAP financial measures and are not intended to
replace net income (loss) attributable to Bunge, the most directly
comparable U.S. GAAP financial measure. Bunge's management believes
these non-GAAP measures are a useful measure of its reportable
segments' operating profitability, since the measures allow for an
evaluation of segment performance without regard to their financing
methods or capital structure. For this reason, operating
performance measures such as these non-GAAP measures are widely
used by analysts and investors in Bunge's industries. These
non-GAAP measures are not a measure of consolidated operating
results under U.S. GAAP and should not be considered as an
alternative to net income (loss) or any other measure of
consolidated operating results under U.S. GAAP.
Below is a reconciliation of Net income attributable to Bunge to
Total Segment EBIT, adjusted:
|
|
|
|
|
|
|
|
|
|
|
Quarter
Ended
|
|
Six Months
Ended
|
|
|
June
30,
|
|
June
30,
|
(US$ in
millions)
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
Net income (loss)
attributable to Bunge
|
$
|
81
|
$
|
121
|
$
|
128
|
$
|
356
|
Interest
income
|
|
(8)
|
|
(14)
|
|
(20)
|
|
(24)
|
Interest
expense
|
|
62
|
|
59
|
|
127
|
|
116
|
Income tax expense
(benefit)
|
|
(55)
|
|
39
|
|
(27)
|
|
73
|
(Income) loss from
discontinued operations, net of tax
|
|
(6)
|
|
4
|
|
-
|
|
13
|
Noncontrolling
interest share of interest and tax
|
|
(1)
|
|
(4)
|
|
(2)
|
|
(7)
|
Total Segment
EBIT
|
|
73
|
|
205
|
|
206
|
|
527
|
Certain (gains) and
charges
|
|
6
|
|
12
|
|
12
|
|
12
|
Total Segment
EBIT, adjusted
|
$
|
79
|
$
|
217
|
$
|
218
|
$
|
539
|
Net Income (loss) per common share from continuing
operations–diluted, adjusted
Net income (loss) per common share from continuing
operations-diluted, adjusted, excludes certain gains and charges
and discontinued operations and is a non-GAAP financial measure.
This measure is not a measure of earnings per common share-diluted,
the most directly comparable U.S. GAAP financial measure. It should
not be considered as an alternative to earnings per share-diluted
or any other measure of consolidated operating results under U.S.
GAAP. Net income (loss) per common share from continuing
operations-diluted, adjusted is a useful measure of the Company's
profitability.
Below is a reconciliation of Net income attributable to Bunge to
Net income (loss) – adjusted (excluding certain gains & charges
and discontinued operations).
|
|
|
Quarter
Ended
|
|
|
Six Months
Ended
|
(US$ in millions,
except per share data)
|
|
June
30,
|
|
|
June
30,
|
|
|
|
2017
|
|
2016
|
|
|
|
2017
|
|
2016
|
Net Income
attributable to Bunge
|
$
|
81
|
$
|
121
|
|
|
$
|
128
|
$
|
356
|
|
Adjusted for certain
gains and charges:
|
|
|
|
|
|
|
|
|
|
|
|
Impairment Charges
(1)
|
|
-
|
|
8
|
|
|
|
-
|
|
8
|
|
Restructuring Charges
(2)
|
|
6
|
|
-
|
|
|
|
12
|
|
-
|
|
Income tax benefits
(charges) (3)
|
|
(49)
|
|
(11)
|
|
|
|
(49)
|
|
(39)
|
Adjusted Net
Income attributable to Bunge
|
|
38
|
|
118
|
|
|
|
91
|
|
325
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Discontinued
Operations
|
|
(6)
|
|
4
|
|
|
|
-
|
|
13
|
|
Other Redeemable
Obligations
|
|
-
|
|
(3)
|
|
|
|
-
|
|
(8)
|
|
Convertible
Preference shares dividends
|
|
(9)
|
|
(9)
|
|
|
|
(17)
|
|
-
|
Net income (loss)
- adjusted (excluding certain gains & charges and discontinued
operations)
|
$
|
23
|
$
|
110
|
|
|
$
|
74
|
$
|
330
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted-average
common shares outstanding - diluted (6)
|
|
141
|
|
140
|
|
|
|
141
|
|
148
|
Net income (loss)
per common share - diluted, adjusted (excluding certain gains &
charges and discontinued operations)
|
$
|
0.17
|
$
|
0.79
|
|
|
$
|
0.52
|
$
|
2.23
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Below is a reconciliation of Net income (loss) per common share
from continuing operations - diluted, adjusted (excluding certain
gains & charges and discontinued operations) to Net income
(loss) per common share–diluted.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Quarter
Ended
|
|
|
Six Months
Ended
|
|
|
|
June
30,
|
|
|
June
30,
|
|
|
|
2017
|
|
2016
|
|
|
|
2017
|
|
2016
|
Continuing
operations:
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) per
common share – diluted, adjusted (excluding certain
|
|
|
|
|
|
|
|
|
|
|
|
gains & charges
and discontinued operations)
|
$
|
0.17
|
$
|
0.79
|
|
|
$
|
0.52
|
$
|
2.23
|
Certain gains &
charges (see Additional Financial Information section)
|
|
0.31
|
|
0.02
|
|
|
|
0.27
|
|
0.20
|
Net income (loss) per
common share - continuing operations
|
|
0.48
|
|
0.81
|
|
|
|
0.79
|
|
2.43
|
|
|
|
|
|
|
|
|
|
|
|
Discontinued
operations:
|
|
0.03
|
|
(0.03)
|
|
|
|
-
|
|
(0.09)
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss)
per common share - diluted
|
$
|
0.51
|
$
|
0.78
|
|
|
$
|
0.79
|
$
|
2.34
|
Notes
Agribusiness:
1) 2016 EBIT includes a
pre-tax impairment charge of $(12)
million related to remaining unamortized carrying value of
certain patents, recorded in the second quarter.
Sugar & Bioenergy:
2) 2017 EBIT includes a
$(12) million pre-tax restructuring
charge of which $(6) million was
recorded in the first quarter and $(6)
million recorded in the second quarter.
Income Taxes:
3) 2017 income tax benefits
(charges) include a benefit of $32
million for the favorable resolution of an uncertain tax
position in Asia recorded in the
second quarter. In addition, 2017 income tax benefits (charges)
include a benefit of $17 million as a
result of a tax election in South
America recorded in the second quarter.
2016 income tax benefits (charges)
include benefits of $60 million, net
of reserves for the change in a tax election for North America recorded in the first quarter
and $11 million related to tax
credits in Europe recorded in the
second quarter, offset by a charge of $(32)
million for an uncertain tax position related to
Asia recorded in the first
quarter.
Notes to Financial Tables:
4) See Definition and
Reconciliation of Non-GAAP Measures.
5) A reconciliation of Net
income attributable to Bunge to Net income is as follows:
|
Six Months
Ended
|
|
June
30,
|
|
|
2017
|
|
|
2016
|
Net income
attributable to Bunge
|
$
|
128
|
|
$
|
356
|
|
EBIT attributable to
noncontrolling interest
|
|
9
|
|
|
3
|
|
Noncontrolling
interest share of interest and tax
|
|
(2)
|
|
|
(7)
|
|
Net
income
|
$
|
135
|
|
$
|
352
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
6) Approximately 3 million
outstanding stock options and contingently issuable restricted
stock units were not dilutive and not included in the
weighted-average number of common shares outstanding for the three
and six months ended June 30, 2017.
Approximately 8 million weighted-average common shares that are
issuable upon conversion of the convertible preference shares were
not dilutive and not included in the weighted-average number of
shares outstanding for the three and six months ended June 30, 2017.
Approximately 4 million
outstanding stock options and contingently issuable restricted
stock units were not dilutive and not included in the
weighted-average number of common shares outstanding for the three
and six months ended June 30, 2016.
Approximately 8 million weighted-average common shares that are
issuable upon conversion of the convertible preference shares were
not dilutive and not included in the weighted-average number of
common shares outstanding for the three months ended June 30, 2016.
7) Includes readily
marketable inventories of $4,376
million and $3,855 million at
June 30, 2017 and December 31, 2016, respectively. Of these
amounts, $3,147 million and
$2,523 million, respectively, can be
attributable to merchandising activities.
8) The Oilseed business
included in our Agribusiness segment consists of our global
activities related to the crushing of oilseeds (including soybeans,
canola, rapeseed and sunflower seed) into protein meals and
vegetable oils; the trading and distribution of oilseeds and
oilseed products; and biodiesel production, which is primarily
conducted through joint ventures.
The Grains business included in
our Agribusiness segment consists primarily of our global grain
origination activities, which principally conduct the purchasing,
cleaning, drying, storing and handling of corn, wheat, barley, rice
and oilseeds at our network of grain elevators; the logistical
services for distribution of these commodities to our customer
markets through our port terminals and transportation assets
(including trucks, railcars, barges and ocean vessels); and
financial services and activities for customers from whom we
purchase commodities and other third parties.
View original
content:http://www.prnewswire.com/news-releases/bunge-reports-second-quarter-2017-results-300498048.html
SOURCE Bunge Limited