Corn Products International, Inc. (NYSE: CPO), a leading global
provider of agriculturally derived ingredients for diversified
markets, today reported record quarterly diluted earnings per share
of $0.90 for the second quarter ended June 30, 2008, a 36 percent
increase compared with diluted earnings per share of $0.66 a year
ago. Included in this quarter�s results was a 4-cent negative
impact from costs related to the pending merger with Bunge Limited
(NYSE: BG). Net income of $68 million in the second quarter of 2008
improved 35 percent versus $51 million in the prior year. For the
10th consecutive quarter, net sales reached a record level. Net
sales of $1.03 billion in the second quarter of 2008 increased 20
percent versus $857 million in the prior-year period. The higher
net sales were primarily the result of improved price/product mix,
and, to a lesser degree, favorable foreign currency translations,
partially offset by reduced volumes in all three geographic
regions. Gross profit of $187 million in the second quarter of 2008
increased 20 percent compared with $156 million a year ago. The
increase was the result of significantly higher North and South
American results due predominantly to strong pricing actions. The
gross margin of 18.1 percent was unchanged versus last year.
Operating expenses as a percentage of net sales in the second
quarter of 2008 declined to 7.1 percent compared with 7.6 percent a
year ago. Merger-related expenses of approximately $4 million were
included in this year�s operating expenses. Operating income of
$116 million in the second quarter of 2008 grew 28 percent versus
$91 million in 2007. The operating margin improved to 11.3 percent
from 10.6 percent last year. A 47 percent reduction in net
financing costs in the second quarter of 2008 to $6.9 million was
primarily attributable to lower net interest expense and foreign
currency translation gains. The 2008 second quarter effective tax
rate of 34.9 percent compared with 32.8 percent in 2007. Regional
Business Segment Performance Regional results for the quarter ended
June 30, 2008 were as follows: North America Net sales of $609
million increased 14 percent from $534 million in 2007
predominantly due to favorable price/product mix, as well as
slightly positive foreign currency translation. Volumes were
unfavorable across the region primarily as a result of economic
softness and weather conditions. Sequentially, unit volume improved
from the first quarter of 2008. Operating income of $86 million
grew 25 percent versus $68 million last year. All three country
businesses contributed to the increased profitability. South
America Net sales of $298 million rose 36 percent compared with
$219 million a year ago as a result of positive price/product mix
and foreign currency translations. Volumes were lower primarily
from reduced takeaway in the Brazilian brewing segment and the
impact of the farmers� strike in Argentina. Operating income of $37
million grew 41 percent from $26 million in the prior year due to a
significant improvement in Brazil, as well as increases in the
Southern Cone and Andean region. Asia/Africa Net sales of $122
million increased 16 percent versus $105 million last year due to
significantly improved price/product mix, partially offset by
unfavorable volumes and foreign currency translation. Operating
income of $13 million increased 9 percent from $12 million in 2007.
Growth in Pakistan, Thailand and China more than offset lower
operating income in South Korea. Excluding South Korea, the
division�s operating income rose 88 percent. 2008 First Half
Results For the first six months of 2008, the Company reported net
income of $133 million, or $1.75 per diluted share, compared with
net income of $101 million, or $1.32 per diluted share, last year.
Gross profit and operating income increased 19 percent and 25
percent, respectively, versus the prior-year period. Net sales of
$1.96 billion grew 21 percent versus $1.62 billion in the prior
year. Favorable price/product mix and, to a lesser degree, positive
foreign currency translations drove the increase, which was
partially offset by reduced volumes. The effective tax rate for the
first half of 2008 was 34.2 percent versus 33.4 percent in 2007.
Balance Sheet and Cash Flow The Company�s balance sheet remained
strong as of June 30, 2008. Net debt (total debt less cash) was
$344 million versus $474 million at December 31, 2007 and $497
million at June 30, 2007. Total debt to capitalization of 22.7
percent at June 30, 2008 compared with 26.6 percent at year-end
2007. Cash provided by operations of $233 million for the first
half of 2008 compared favorably to $67 million in the prior year.
The improvement reflected a positive swing in working capital of
$138 million principally attributable to cash received from margin
accounts relating to corn futures contracts and improved
collections of accounts receivable, which more than offset an
increase in inventories primarily due to higher raw material costs.
An increase in net income of $32 million also contributed to the
improvement. 2008 Outlook Corn Products International has raised
its diluted EPS expectations for full-year 2008 to $3.15 to $3.35,
or a 22 to 29 percent increase versus a record $2.59 in 2007, which
included a 5-cent gain from the Company�s holdings in CME Group
Inc. Previous full-year 2008 EPS guidance was $2.90 to $3.15. Net
sales in 2008 should reach $4 billion. �We expect a solid second
half,� said Sam Scott, chairman, president and chief executive
officer of Corn Products International. �Given our full-year EPS
guidance, the second half of 2008 should be in the range of $1.40
to $1.60 versus $1.27 a year ago, which would be an increase of 10
to 26 percent. As noted previously, our first half results should
be stronger than our second half performance as we anticipate
higher raw material costs.� Conference Call and Webcast Corn
Products International will conduct a conference call today at 8:30
a.m. Eastern Time (7:30 a.m. Central Time) to be hosted by Sam
Scott, chairman, president and chief executive officer, and Cheryl
Beebe, vice president and chief financial officer. The call will be
broadcast in a real-time webcast. The broadcast will consist of the
call and a visual presentation accessible through the Corn Products
International Web site at www.cornproducts.com. The
�listen-and-view-only� presentation will be available to download
approximately 60 minutes prior to the start of the call. A replay
of the webcast will be available at www.cornproducts.com.
Individuals without Internet access may listen to the live
conference call by dialing 719.325.4837. A replay of the audio call
will be available through Tuesday, August 5 by calling 719.457.0820
and using passcode 3415218. About the Company Corn Products
International is one of the world's largest corn refiners and a
major supplier of high-quality food ingredients and industrial
products derived from the wet milling and processing of corn and
other starch-based materials. The Company, headquartered in
Westchester, Ill., is a leading worldwide producer of dextrose and
a major regional supplier of starch, high fructose corn syrup and
glucose. In 2007, Corn Products International reported record net
sales and diluted earnings per share of $3.4 billion and $2.59,
respectively, with operations in 15 countries at 34 plants,
including wholly owned businesses, affiliates and alliances. For
more information, visit www.cornproducts.com. Forward-Looking
Statement This news release contains or may contain forward-looking
statements within the meaning of Section 27A of the Securities
Exchange Act of 1933 and Section 21E of the Securities Exchange Act
of 1934. The Company intends these forward looking statements to be
covered by the safe harbor provisions for such statements. These
statements include, among other things, any predictions regarding
the Company�s future financial condition, earnings, revenues,
expenses or other financial items, any statements concerning the
Company�s prospects or future operation, including management�s
plans or strategies and objectives therefor and any assumptions
underlying the foregoing. These statements can sometimes be
identified by the use of forward looking words such as �may,�
�will,� �should,� �anticipate,� �believe,� �plan,� �project,�
�estimate,� �expect,� �intend,� �continue,� �pro forma,� �forecast�
or other similar expressions or the negative thereof. All
statements other than statements of historical facts in this
release or referred to in this release are �forward-looking
statements.� These statements are subject to certain inherent risks
and uncertainties. Although we believe our expectations reflected
in these forward-looking statements are based on reasonable
assumptions, stockholders are cautioned that no assurance can be
given that our expectations will prove correct. Actual results and
developments may differ materially from the expectations conveyed
in these statements, based on various factors, including
fluctuations in worldwide markets for corn and other commodities,
and the associated risks of hedging against such fluctuations;
fluctuations in aggregate industry supply and market demand;
general political, economic, business, market and weather
conditions in the various geographic regions and countries in which
we manufacture and/or sell our products; fluctuations in the value
of local currencies, energy costs and availability, freight and
shipping costs, and changes in regulatory controls regarding
quotas, tariffs, duties, taxes and income tax rates; operating
difficulties; our ability to effectively integrate acquired
businesses; labor disputes; genetic and biotechnology issues;
changing consumption preferences and trends; increased competitive
and/or customer pressure in the corn-refining industry; the
outbreak or continuation of serious communicable disease or
hostilities including acts of terrorism; and stock market
fluctuation and volatility. Our forward-looking statements speak
only as of the date on which they are made and we do not undertake
any obligation to update any forward-looking statement to reflect
events or circumstances after the date of the statement. If we do
update or correct one or more of these statements, investors and
others should not conclude that we will make additional updates or
corrections. For a further description of these risks, see Risk
Factors included in our Annual Report on Form 10-K for the year
ended December 31, 2007 and subsequent reports on Forms 10-Q or
8-K. This news release also may contain references to the Company�s
long term objectives and goals or targets with respect to certain
metrics. These objectives, goals and targets are used as a
motivational and management tool and are indicative of the
Company�s long term aspirations only, and they are not intended to
constitute, nor should they be interpreted as, an estimate,
projection, forecast or prediction of the Company�s future
performance. � Corn Products International, Inc. Condensed
Consolidated Statements of Income (Unaudited) � � � � � � (In
millions, except per share amounts) � Three Months EndedJune 30,
Change% Six Months EndedJune 30, Change% 2008 � 2007 2008 � 2007 �
Net sales before shipping and handling costs $ 1,093.6 $ 917.0 19 %
$ 2,084.6 $ 1,733.6 20 % Less: shipping and handling costs 65.1 �
60.0 9 % 125.2 � 114.8 � 9 % Net sales $ 1,028.5 $ 857.0 20 % $
1,959.4 $ 1,618.8 21 % Cost of sales 841.9 � 701.5 20 % 1,599.5 �
1,317.2 � 21 % Gross profit $ 186.6 $ 155.5 20 % $ 359.9 $ 301.6 19
% � Operating expenses 73.4 64.9 13 % 140.9 122.5 15 % Other income
(expense), net 2.6 � 0.0 3.6 � (0.8 ) Operating income $ 115.8 $
90.6 28 % $ 222.6 $ 178.3 25 % Financing costs, net 6.9 � 12.9 -47
% 14.3 � 22.7 � -37 % Income before income taxes $ 108.9 $ 77.7 40
% $ 208.3 $ 155.6 34 % Provision for income taxes 38.0 � 25.5 71.3
� 52.0 � $ 70.9 $ 52.2 36 % $ 137.0 $ 103.6 32 % Minority interest
in earnings 2.5 � 1.6 56 % 4.3 � 3.0 � 43 % Net income $ 68.4 � $
50.6 35 % $ 132.7 � $ 100.6 � 32 % � Weighted average common shares
outstanding: Basic 74.4 74.8 74.2 74.6 Diluted 76.2 76.6 75.9 76.4
� Earnings per common share: Basic $0.92 $0.68 35 % $1.79 $1.35 33
% Diluted $0.90 $0.66 36 % $1.75 $1.32 33 % � CORN PRODUCTS
INTERNATIONAL, INC. Condensed Consolidated Balance Sheets � � � (In
millions, except share and per share amounts) June 30, 2008
December 31, 2007 (Unaudited) � Assets Current assets Cash and cash
equivalents $292 $175 Accounts receivable � net 654 460 Inventories
526 427 Prepaid expenses 17 14 � Deferred income taxes � 14 � � 13
� Total current assets � $1,503 � � $1,089 � � Property, plant and
equipment � net 1,566 1,500 Goodwill and other intangible assets
405 426 Deferred income taxes 1 1 Investments 10 13 � Other assets
� 107 � � 74 � Total assets � $3,592 � � $3,103 � � Liabilities and
equity Current liabilities Short-term borrowings and current
portion of long-term debt 122 130 Deferred income taxes 28 28 �
Accounts payable and accrued liabilities � 631 � � 516 � Total
current liabilities � $781 � � $674 � � Non-current liabilities 126
123 Long-term debt 514 519 Deferred income taxes 221 133 Minority
interest in subsidiaries 21 21 Redeemable common stock (500,000
shares issued and outstandingat June 30, 2008 and December 31,
2007) stated at redemption value 23 19 Share-based payments subject
to redemption 8 9 � � Stockholders� equity Preferred stock �
authorized 25,000,000 shares- $0.01 par value, none issued - -
Common stock � authorized 200,000,000 shares- $0.01 par value �
74,819,774 shares issued at June 30 2008 and December 31, 2007 1 1
Additional paid in capital 1,074 1,082 Less: Treasury stock (common
stock; 950,281 and 1,568,996 shares at June 30, 2008 and December
31, 2007, respectively) at cost (35 ) (57 ) Accumulated other
comprehensive income (loss) 50 (115 ) � Retained earnings � 808 � �
694 � Total stockholders� equity � $1,898 � � $1,605 � Total
liabilities and equity � $3,592 � � $3,103 � � CORN PRODUCTS
INTERNATIONAL, INC. Condensed Consolidated Statements of Cash Flows
(Unaudited) � � � � For the Six Months EndedJune 30, ( In millions
) 2008 2007 � Cash provided by operating activities: Net income $
133 $ 101 Adjustments to reconcile net income to net cash provided
by operating activities: Depreciation 65 62 Decrease (increase) in
trade working capital 37 (101 ) � Other � (2 ) � 5 � � Cash
provided by operating activities � 233 � � 67 � � Cash used for
investing activities: Capital expenditures, net of proceeds on
disposal (105 ) (69 ) Payments for acquisition (net of cash
acquired of $7) - (59 ) � Other � 5 � � 1 � � Cash used for
investing activities � (100 ) � (127 ) � Cash used for financing
activities: Proceeds from (payments on) borrowings, net (10 ) 331
Issuances (repurchases) of common stock, net 10 5 Dividends paid
(including to minority interest shareholders) (20 ) (16 ) Excess
tax benefit on share-based compensation 3 3 � Other � - � � 1 � �
Cash provided by (used for) financing activities � (17 ) � 324 � �
� Effect of foreign exchange rate changes on cash � 1 � � 1 �
Increase in cash and cash equivalents 117 265 � Cash and cash
equivalents, beginning of period � 175 � � 131 � � Cash and cash
equivalents, end of period � $ 292 � � $ 396 � � Corn Products
International, Inc. Supplemental Financial Information (Unaudited)
� � � � � � � I. Geographic Information of Net Sales and Operating
Income � (Dollars in millions) Three Months EndedJune 30, Change
Six Months EndedJune 30, Change 2008 2007 % 2008 2007 % Net Sales
North America $ 609.3 $ 533.7 14 % $1,146.2 $1,001.4 14 % South
America 297.6 218.5 36 % 569.6 418.9 36 % Asia/Africa 121.6 � 104.8
� 16 % 243.6 � 198.5 � 23 % Total $1,028.5 � $ 857.0 � 20 %
$1,959.4 � $1,618.8 � 21 % � Operating Income North America $ 85.5
$ 68.4 25 % $ 160.8 $ 129.5 24 % South America 36.5 25.9 41 % 68.7
50.9 35 % Asia/Africa 12.7 11.7 9 % 25.6 26.0 (2 %) Corporate (18.9
) (15.4 ) 23 % (32.5 ) (28.1 ) 16 % Total $ 115.8 � $ 90.6 � 28 % $
222.6 � $ 178.3 � 25 % � � � II. Capital expenditures � Capital
expenditures, net of proceeds on disposals, for the quarters ended
June 30, 2008 and 2007, were $57 million and $37 million,
respectively. Capital expenditures for the full year 2008 are
estimated to be in the range of $200 million to $250 million. III.
Non-GAAP Information � The Company uses certain key metrics to
better monitor our progress towards achieving our strategic
business objectives. Among these metrics is the Total Debt to
Capitalization Percentage, which is not calculated in accordance
with Generally Accepted Accounting Principles (�GAAP�). Management
believes that this non-GAAP information provides investors with a
meaningful presentation of useful information on a basis consistent
with the way in which management monitors and evaluates the
Company�s operating performance. The information presented should
not be considered in isolation and should not be used as a
substitute for our financial results calculated under GAAP. In
addition, these non-GAAP amounts are susceptible to varying
interpretations and calculations, and the amounts presented below
may not be comparable to similarly titled measures of other
companies. Our calculations of the Total Debt to Capitalization
Percentage at June 30, 2008 and December 31, 2007 are as follows: �
� � Total Debt to Capitalization Percentage � June 30, December 31,
(Dollars in millions) 2008 2007 � Short-term debt $122 $130
Long-term debt 514 519 Total debt (a) $636 $649 � Deferred income
tax liabilities 221 133 Minority interest in subsidiaries 21 21
Redeemable common stock 23 19 Share-based payments subject to
redemption 8 9 Stockholders� equity 1,898 1,605 Total capital
$2,171 $1,787 � � Total debt and capital (b) $2,807 $2,436 � Debt
to capitalization percentage (a/b) 22.7% 26.6%
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