Archer's EPS Dented by Higher Taxes - Analyst Blog
August 02 2011 - 5:58AM
Zacks
Archer Daniels Midland Company (ADM) reported a
disappointed fourth-quarter 2011 results. Net income for the
reported quarter was $381.0 million or 58 cents per share compared
with $446.0 million or 69 cents per share in the year-ago quarter.
Quarterly earnings also missed the Zacks Consensus Estimate of 84
cents a share.
Earnings in the reported quarter declined primarily due to a
robust rise in income tax rate, partially offset by increased
segmental profit and positive discrepancy from changes in
Last-In-First-Out (LIFO) inventory valuations caused by lower
agricultural commodity prices.
Quarterly Details
Archer Daniels' quarterly net sales surged 45.6% year over year
to $22,870.0 million, beating the Zacks Consensus Estimate of
$20,484.0 million. The growth in net sales was mainly attributable
to a robust jump of 42.2% in Agricultural Services to $9,960.0
million, a rise of 56.1% in Oilseeds Processing revenues to
$8,567.0 million and an increase of 44.3% in Corn Processing
revenues to $2,841.0 million.
Total segment operating profit for Archer Daniels increased to
$888.0 million from $799.0 million in the prior-year quarter.
Operating profit for Agricultural Services segment grew 8.4% to
$193.0 million from $178.0 million in the year-ago period,
reflecting strong results from North American interior elevators
and export operations, partially offset by weaker international
operations.
Archer Daniels' Corn Processing segment's operating profit
inched down to $118.0 million from $140.0 million last year. The
decline was primarily attributed to a significant surge in net corn
costs, partially offset by improvement in bio-products performance,
stemming from better margins of ethanol and lysine and increased
processing volume.
Archer Daniels' Oilseeds Processing segment recorded a quarterly
operating profit of $379.0 million compared with an operating
profit of $359.0 million in the year-ago period. The increase was
primarily attributable to better performance in North America.
Operating profit from the other business segment came in at
$198.0 million compared with an operating profit of $122.0 million
in the year-ago quarter.
The long-term debt-to-capitalization ratio was 31.0% compared
with a long-term debt-to-capitalization ratio of 32.9% in the
prior-year quarter.
Archer Daniels, which competes with Bunge
Limited (BG) and Corn Products International
Inc. (CPO), currently has a Zacks #4 Rank, implying a
short-term Sell rating on the stock. The company also retains a
long-term Neutral recommendation.
ARCHER DANIELS (ADM): Free Stock Analysis Report
BUNGE LTD (BG): Free Stock Analysis Report
CORN PROD INTL (CPO): Free Stock Analysis Report
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