WHITE PLAINS, N.Y.,
Feb. 21, 2019 /PRNewswire/
-- Bunge Limited (NYSE: BG) today reported Q4 2018 and
full-year 2018 results.
- Full-year 2018 GAAP EPS of $1.57 vs. $0.89 in
the prior year; $2.72 vs.
$1.94 on an adjusted
basis;
- Q4 GAAP EPS of $(0.51)
vs.$(0.48) in the prior year;
$0.08 vs. $0.67 on an adjusted basis
- Agribusiness impacted by decline in value of Brazilian
soybean ownership; full year results up 114% on strong soy
crush margins
- In Food & Ingredients, Loders Croklaan integration
proceeding as planned
- Sugar & Bioenergy impacted by heavy rains as poor crop
year came to an end
- Global Competitiveness Program delivered $200 million of savings in 2018, expect
$50 million of additional
savings in 2019, reaching original target a year ahead of
schedule
- Strategic Review and CEO search progressing
Kathleen Hyle, Bunge's
Non-Executive Board Chair, stated, "Although 2018 was a
substantially better year than 2017, we are not satisfied with
these results, and we know that Bunge has the global assets and
people to perform better in the future. In the past several months,
the Company has taken a number of significant and positive steps to
reposition itself for sustainable growth, including announcing a
leadership transition and enhancing its leadership team, refreshing
our Board and establishing a Strategic Review Committee of the
Board."
Ms. Hyle continued, "The Committee initiated and is continuing a
thorough, outside-in review of all of Bunge's businesses. At the
same time, we are committed to addressing underperforming assets as
part of our effort to enhance shareholder value, and we are
strengthening our risk management capabilities, as they are
foundational to everything we do. The Board and the leadership team
are moving with speed and accountability to drive results."
Acting CEO Greg Heckman
commented, "Even in my short time leading the company, I see many
strengths. We have a world-class global network of assets and a
talented team of people, all of whom are committed to driving the
business forward. While the Strategic Review Committee continues
its work, we are refocusing the organization and placing greater
emphasis on improved execution. Our key priorities are to
drive operational performance, optimize the portfolio, strengthen
our capital allocation framework and sharpen our financial
discipline. I am confident that with the actions we are taking, we
will be able to better leverage Bunge's asset base and increase
shareholder returns."
|
Quarter Ended
December 31,
|
|
Year Ended
December 31,
|
US$ in millions,
except per share data
|
2018
|
|
2017
|
|
2018
|
2017
|
Net income (loss)
attributable to Bunge
|
$
|
(65)
|
|
|
$
|
(60)
|
|
|
$
|
267
|
|
$
|
160
|
|
|
|
|
|
|
|
|
Net income (loss)
per common share from continuing
operations-diluted
|
$
|
(0.51)
|
|
|
$
|
(0.48)
|
|
|
$
|
1.57
|
|
$
|
0.89
|
|
|
|
|
|
|
|
|
Net income (loss)
per common share from continuing
operations-diluted, adjusted (a)
|
$
|
0.08
|
|
|
$
|
0.67
|
|
|
$
|
2.72
|
|
$
|
1.94
|
|
|
|
|
|
|
|
|
Total Segment EBIT
(a)
|
$
|
70
|
|
|
$
|
55
|
|
|
$
|
737
|
|
$
|
436
|
|
Certain gains &
(charges) (b)
|
(37)
|
|
|
(100)
|
|
|
(144)
|
|
(141)
|
|
Total Segment EBIT,
adjusted (a)
|
$
|
107
|
|
|
$
|
155
|
|
|
$
|
881
|
|
$
|
577
|
|
Agribusiness
(c)
|
$
|
55
|
|
|
$
|
78
|
|
|
$
|
709
|
|
$
|
332
|
|
Oilseeds
|
$
|
112
|
|
|
$
|
34
|
|
|
$
|
584
|
|
$
|
216
|
|
Grains
|
$
|
(57)
|
|
|
$
|
44
|
|
|
$
|
125
|
|
$
|
116
|
|
Food & Ingredients
(d)
|
$
|
73
|
|
|
$
|
70
|
|
|
$
|
235
|
|
$
|
223
|
|
Sugar &
Bioenergy
|
$
|
(48)
|
|
|
$
|
(8)
|
|
|
$
|
(105)
|
|
$
|
3
|
|
Fertilizer
|
$
|
27
|
|
|
$
|
15
|
|
|
$
|
42
|
|
$
|
19
|
|
(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; 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 and notes attached to this
press release and the accompanying slide presentation posted on
Bunge's website. See Note 14 for a reconciliation of Cash
provided by (used for) operating activities to Adjusted funds from
operations.
|
(b)
|
Certain gains
& (charges) included in Total Segment EBIT. See
Additional Financial Information for detail.
|
(c)
|
See Note 13 for a
description of the Oilseeds and Grains businesses in Bunge's
Agribusiness segment.
|
(d)
|
Includes Edible
Oil Products and Milling Products segments.
|
Agribusiness
Lower segment results in the quarter were largely due to the
reduction in value of the Company's Brazilian soybean ownership as
factors related to China trade and
demand caused Brazilian soybean prices to converge with U.S. and
Brazilian new crop prices. The approximate $125 million loss associated with this reduction
in prices impacted results in both oilseeds trading and
distribution and grains origination.
In Oilseeds, structural soy crush margins were higher in the
U.S., Europe, Brazil and Asia due to more favorable market conditions.
Margins, however, were lower in Argentina due to tight bean supplies resulting
from the drought and farmer retention. Total soy crush volumes were
similar to last year, as higher volumes in the Northern Hemisphere
were offset by lower volumes in South
America. Results in softseed processing were higher, as
improved structural margins in Europe more than offset lower margins in
Canada.
In Grains, Origination results declined due to lower structural
margins and volumes, which were impacted by the decrease in soybean
demand from China. Results in
grain trading and distribution were comparable to last year.
Edible Oil Products
Higher results in the quarter were driven by the contribution
from Loders Croklaan, and improved performance in Europe, which benefitted from higher volumes
and lower unit costs, and an increase in volumes and margins in
Argentina. Results in North America and Brazil were lower than last year. The
integration of Loders Croklaan with our existing B2B oils business
is progressing as planned.
Milling Products
Higher margins and volumes in Brazil were more than offset by lower margins
and volumes in Mexico. Results in
the U.S. were similar to last year.
Sugar & Bioenergy
Results in the quarter were significantly below the Company's
expectations, primarily due to the combination of sustained rain
during the quarter, which negatively impacted sales and unit costs,
and lower than expected ethanol prices. Compared with last
year, lower results were primarily driven by lower sugar prices,
reduced sugarcane crush volume and lower yields.
Fertilizer
Higher results in the quarter were primarily driven by higher
prices and lower costs related to prior restructuring actions,
which more than offset slightly lower volumes. Additionally, fourth
quarter results included the remaining $6
million recovery of foreign exchange losses from the second
quarter.
Global Competitiveness Program
The Global Competitiveness Program (GCP) announced in
July 2017 is rationalizing Bunge's
cost structure and reengineering the way the Company operates,
reducing 2017 addressable baseline SG&A of $1.35 billion to $1.1
billion by 2020.
The Company has reduced addressable SG&A by approximately
$200 million as compared with its
2017 baseline. This reflects $100
million of additional savings compared with the Company's
initial outlook for 2018. The Company expects 2019 savings against
the baseline of approximately $250
million, achieving its addressable SG&A target of
$1.1 billion a full year ahead of
schedule. With the changes implemented and ongoing continuous
improvement, the program is expected to achieve additional savings
beyond 2019.
Cash Flow
Cash used by operations in the year ended December 31, 2018 was approximately
$1,264 million compared with cash
used of approximately $1,975
million in the same period last year. Adjusting for beneficial
interest in securitized trade receivables, cash provided by
operating activities was $645 million
compared with cash provided by operating activities of $1,026 million in the prior year. The
year-over-year decrease was primarily driven by higher inventory,
which was partially offset by higher earnings. Adjusted funds from
operations was approximately $1.1
billion as of the year ended December
31, 2018. Total capex of $493
million was $169 million below
prior year, reflecting disciplined capital investment.
Income Taxes
The effective tax rate for the year ended December 31, 2018 was approximately 39%.
Adjusting for all notable items, the effective tax rate for the
year ended December 31, 2018 was
approximately 26%. The higher than expected tax rate was primarily
due to earnings mix and the significantly larger than anticipated
loss in Sugar & Bioenergy that raised our tax rate by 4
percentage points.
Beginning in 2019, the Company is changing its guidance
approach. Bunge will provide directional guidance for the company
instead of individual segment EBIT ranges as it has previously.
In Agribusiness, based on the current soy crush margin
environment, 2019 full-year results would be expected to be lower
than 2018. Actual soy crush margins over the course of the
year are likely to evolve based on U.S.-China trade discussions, crop sizes and farmer
commercialization. Based on the current softseed crush margin
environment, results would be slightly higher than last year,
driven by strong oil demand. Improvements in risk management and in
how we operate should support higher results in Grains compared
with last year.
In Food & Ingredients, full-year results in Edible Oils
should benefit from 12 months of ownership of Loders Croklaan, as
well as increased synergies from the integration of our B2B
businesses. Favorable Milling operating environments in
Brazil and the U.S. are likely to
be partially offset by more challenging conditions in Mexico.
In Sugar & Bioenergy, based on normal weather and forward
price curves for sugar and ethanol, full-year 2019 results would be
expected to be about break-even. Approximately 60% of sugar
production has been hedged and, weather permitting, the Company
plans to crush approximately 19 mmt of cane. As in past
years, results will be seasonally weighted to the second half of
the year.
In Fertilizer, based on the current market environment,
full-year results would be lower than last year.
The Global Competitiveness Program is expected to generate
approximately $50 million of
incremental year-over-year savings. The Company expects additional
savings from industrial and supply chain initiatives, which are
expected to offset inflation.
Additionally, the Company expects the following for 2019: A tax
rate in the range of 22% to 26%; net interest expense in the range
of $290 to $310 million; capital expenditures of
approximately $550 million, of which
approximately $115 million is related
to sugarcane milling; and depreciation, depletion and amortization
of approximately $650 million.
- Conference Call and Webcast Details
Bunge Limited's management will host a conference call at 8:00
a.m. EST on Thursday, February 21,
2019 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
and enter confirmation code 1185117. 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 "Q4 2018 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
February 21, 2019, continuing through
March 21, 2019. 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 10127862. A replay will also
be available in "Past events" at "Webcasts and presentations" in
the "Investors" section of the Company's website.
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.
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.
- 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 statements include our expectations regarding
industry trends and our future financial performance, the
completion and timing of acquisitions and dispositions, our
assumptions and expectations for the Global Competitiveness Program
and other efficiency initiatives and similar statements that are
not historical facts. These forward-looking statements 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; the outcome and effects of the Board's strategic
review; the effectiveness of our risk management strategies; our
ability to attract and retain executive management and key
personnel; 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, including a
description of these items and their effect on net income (loss)
attributable to Bunge, earnings per share diluted and total segment
EBIT for the quarters ended December 31, 2018 and 2017.
(US$ in millions,
except per share data)
|
Net Income
(Loss)
Attributable
to
Bunge
|
Earnings
Per
Share
Diluted
|
Total
Segment
EBIT (7)
|
Quarter Ended
December 31,
|
2018
|
2017
|
2018
|
2017
|
2018
|
2017
|
|
|
|
|
|
|
|
Agribusiness:
(1)
|
$
|
(20)
|
|
$
|
(42)
|
|
$
|
(0.14)
|
|
$
|
(0.29)
|
|
$
|
(22)
|
|
$
|
(52)
|
|
Severance, employee
benefit, and other costs
|
(8)
|
|
(29)
|
|
(0.06)
|
|
(0.20)
|
|
(10)
|
|
(42)
|
|
Impairment
charges
|
(10)
|
|
(19)
|
|
(0.07)
|
|
(0.13)
|
|
(10)
|
|
(19)
|
|
Indirect tax
charges
|
(2)
|
|
—
|
|
(0.01)
|
|
—
|
|
(2)
|
|
—
|
|
Gain (loss), net on
disposition of equity investments and
subsidiaries
|
—
|
|
6
|
|
—
|
|
0.04
|
|
—
|
|
9
|
|
|
|
|
|
|
|
|
Edible Oil
Products: (2)
|
$
|
(4)
|
|
$
|
(18)
|
|
$
|
(0.04)
|
|
$
|
(0.13)
|
|
$
|
(3)
|
|
$
|
(22)
|
|
Severance, employee
benefit, and other costs
|
(1)
|
|
(9)
|
|
(0.02)
|
|
(0.06)
|
|
(1)
|
|
(13)
|
|
Indirect tax
credits
|
5
|
|
—
|
|
0.03
|
|
—
|
|
6
|
|
—
|
|
Acquisition and
integration costs
|
(8)
|
|
(9)
|
|
(0.05)
|
|
(0.07)
|
|
(8)
|
|
(9)
|
|
|
|
|
|
|
|
|
Milling
Products: (3)
|
$
|
—
|
|
$
|
(3)
|
|
$
|
—
|
|
$
|
(0.02)
|
|
$
|
—
|
|
$
|
(5)
|
|
Severance, employee
benefit, and other costs
|
(1)
|
|
(3)
|
|
—
|
|
(0.02)
|
|
(1)
|
|
(5)
|
|
Indirect tax
credits
|
1
|
|
—
|
|
—
|
|
—
|
|
1
|
|
—
|
|
|
|
|
|
|
|
|
Sugar &
Bioenergy: (4)
|
$
|
—
|
|
$
|
(4)
|
|
$
|
—
|
|
$
|
(0.03)
|
|
$
|
—
|
|
$
|
(5)
|
|
Severance, employee
benefit, and other costs
|
(1)
|
|
(2)
|
|
—
|
|
(0.02)
|
|
(1)
|
|
(3)
|
|
Impairment
charges
|
—
|
|
(4)
|
|
—
|
|
(0.03)
|
|
—
|
|
(4)
|
|
Indirect tax
credits
|
3
|
|
8
|
|
0.01
|
|
0.06
|
|
3
|
|
8
|
|
Sugar restructuring
charges
|
(2)
|
|
(6)
|
|
(0.01)
|
|
(0.04)
|
|
(2)
|
|
(6)
|
|
|
|
|
|
|
|
|
Fertilizer:
(5)
|
$
|
—
|
|
$
|
(10)
|
|
$
|
—
|
|
$
|
(0.07)
|
|
$
|
—
|
|
$
|
(16)
|
|
Severance, employee
benefit, and other costs
|
—
|
|
(9)
|
|
—
|
|
(0.06)
|
|
—
|
|
(14)
|
|
Impairment
charges
|
—
|
|
(1)
|
|
—
|
|
(0.01)
|
|
—
|
|
(2)
|
|
|
|
|
|
|
|
|
Interest, Income
Taxes and Other Unallocated: (6)
|
$
|
(59)
|
|
$
|
(86)
|
|
$
|
(0.41)
|
|
$
|
(0.61)
|
|
$
|
(12)
|
|
$
|
—
|
|
Loss on
extinguishment of debt
|
(10)
|
|
—
|
|
(0.06)
|
|
—
|
|
(12)
|
|
—
|
|
Interest related to
indirect tax credits and charges
|
4
|
|
—
|
|
0.03
|
|
—
|
|
—
|
|
—
|
|
Income tax benefits
(charges)
|
(53)
|
|
(86)
|
|
(0.38)
|
|
(0.61)
|
|
—
|
|
—
|
|
|
|
|
|
|
|
|
Total
|
$
|
(83)
|
|
$
|
(163)
|
|
$
|
(0.59)
|
|
$
|
(1.15)
|
|
$
|
(37)
|
|
$
|
(100)
|
|
The following table provides a summary of certain gains and
charges that may be of interest to investors, including a
description of these items and their effect on net income (loss)
attributable to Bunge, earnings per share diluted and total segment
EBIT for the years ended December 31, 2018 and 2017.
(US$ in millions,
except per share data)
|
Net Income
(Loss)
Attributable
to
Bunge
|
Earnings
Per
Share
Diluted
|
Total
Segment
EBIT (7)
|
Year Ended
December 31,
|
2018
|
2017
|
2018
|
2017
|
2018
|
2017
|
|
|
|
|
|
|
|
Agribusiness:
(1)
|
$
|
(58)
|
|
$
|
(61)
|
|
$
|
(0.40)
|
|
$
|
(0.43)
|
|
$
|
(64)
|
|
$
|
(76)
|
|
Severance, employee
benefit, and other costs
|
(33)
|
|
(33)
|
|
(0.23)
|
|
(0.23)
|
|
(39)
|
|
(49)
|
|
Impairment
charges
|
(10)
|
|
(34)
|
|
(0.07)
|
|
(0.24)
|
|
(10)
|
|
(36)
|
|
Indirect tax
charges
|
(2)
|
|
—
|
|
(0.01)
|
|
—
|
|
(2)
|
|
—
|
|
Gain (loss), net on
disposition of equity investments
and subsidiaries
|
(13)
|
|
6
|
|
(0.09)
|
|
0.04
|
|
(13)
|
|
9
|
|
|
|
|
|
|
|
|
Edible Oil
Products: (2)
|
$
|
(19)
|
|
$
|
(21)
|
|
$
|
(0.15)
|
|
$
|
(0.15)
|
|
$
|
(20)
|
|
$
|
(26)
|
|
Severance, employee
benefit, and other costs
|
(5)
|
|
(11)
|
|
(0.05)
|
|
(0.07)
|
|
(7)
|
|
(16)
|
|
Impairment
charges
|
—
|
|
(1)
|
|
—
|
|
(0.01)
|
|
—
|
|
(1)
|
|
Indirect tax
credits
|
5
|
|
—
|
|
0.03
|
|
—
|
|
6
|
|
—
|
|
Acquisition and
integration costs
|
(19)
|
|
(9)
|
|
(0.13)
|
|
(0.07)
|
|
(19)
|
|
(9)
|
|
|
|
|
|
|
|
|
Milling
Products: (3)
|
$
|
(2)
|
|
$
|
(5)
|
|
$
|
(0.01)
|
|
$
|
(0.04)
|
|
$
|
(3)
|
|
$
|
(8)
|
|
Severance, employee
benefit, and other costs
|
(3)
|
|
(5)
|
|
(0.01)
|
|
(0.04)
|
|
(4)
|
|
(7)
|
|
Impairment
charges
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
(1)
|
|
Indirect tax
credits
|
1
|
|
—
|
|
—
|
|
—
|
|
1
|
|
—
|
|
|
|
|
|
|
|
|
Sugar &
Bioenergy: (4)
|
$
|
(29)
|
|
$
|
(14)
|
|
$
|
(0.21)
|
|
$
|
(0.10)
|
|
$
|
(30)
|
|
$
|
(15)
|
|
Severance, employee
benefit, and other costs
|
(6)
|
|
(3)
|
|
(0.04)
|
|
(0.02)
|
|
(7)
|
|
(4)
|
|
Impairment
charges
|
—
|
|
(5)
|
|
—
|
|
(0.04)
|
|
—
|
|
(5)
|
|
Indirect tax
credits
|
3
|
|
16
|
|
0.01
|
|
0.11
|
|
3
|
|
16
|
|
Sugar restructuring
charges
|
(10)
|
|
(22)
|
|
(0.07)
|
|
(0.15)
|
|
(10)
|
|
(22)
|
|
Loss on disposition
of equity investment
|
(16)
|
|
—
|
|
(0.11)
|
|
—
|
|
(16)
|
|
—
|
|
|
|
|
|
|
|
|
Fertilizer:
(5)
|
$
|
(2)
|
|
$
|
(10)
|
|
$
|
(0.01)
|
|
$
|
(0.07)
|
|
$
|
(3)
|
|
$
|
(16)
|
|
Severance, employee
benefit, and other costs
|
(2)
|
|
(9)
|
|
(0.01)
|
|
(0.06)
|
|
(3)
|
|
(14)
|
|
Impairment
charges
|
—
|
|
(1)
|
|
—
|
|
(0.01)
|
|
—
|
|
(2)
|
|
|
|
|
|
|
|
|
Interest, Income
Taxes and Other Unallocated: (6)
|
$
|
(53)
|
|
$
|
(37)
|
|
$
|
(0.37)
|
|
$
|
(0.26)
|
|
$
|
(24)
|
|
$
|
—
|
|
Loss on
extinguishment of debt
|
(19)
|
|
—
|
|
(0.13)
|
|
—
|
|
(24)
|
|
—
|
|
Interest related to
indirect tax credits and charges
|
4
|
|
—
|
|
0.03
|
|
—
|
|
—
|
|
—
|
|
Income tax benefits
(charges)
|
(38)
|
|
(37)
|
|
(0.27)
|
|
(0.26)
|
|
—
|
|
—
|
|
|
|
|
|
|
|
|
Total
|
$
|
(163)
|
|
$
|
(148)
|
|
$
|
(1.15)
|
|
$
|
(1.05)
|
|
$
|
(144)
|
|
$
|
(141)
|
|
Consolidated
Earnings Data (Unaudited)
|
|
|
Quarter Ended
December 31,
|
Year Ended
December 31,
|
(US$ in millions,
except per share data)
|
2018
|
2017
|
2018
|
2017
|
Net sales
|
$
|
11,543
|
|
$
|
11,605
|
|
$
|
45,743
|
|
$
|
45,794
|
|
Cost of goods
sold
|
(11,121)
|
|
(11,143)
|
|
(43,477)
|
|
(44,029)
|
|
Gross
profit
|
422
|
|
462
|
|
2,266
|
|
1,765
|
|
Selling, general and
administrative expenses
|
(369)
|
|
(393)
|
|
(1,423)
|
|
(1,437)
|
|
Foreign exchange
gains (losses)
|
15
|
|
(13)
|
|
(101)
|
|
95
|
|
Other income
(expense) – net
|
13
|
|
3
|
|
48
|
|
40
|
|
Gain (loss), net on
disposition of equity interests/subsidiaries
|
—
|
|
9
|
|
(26)
|
|
9
|
|
Equity investment
impairments
|
—
|
|
(4)
|
|
—
|
|
(17)
|
|
EBIT attributable to
noncontrolling interest (a) (8)
|
(11)
|
|
(9)
|
|
(27)
|
|
(19)
|
|
Total Segment EBIT
(7)
|
70
|
|
55
|
|
737
|
|
436
|
|
Interest
income
|
10
|
|
9
|
|
31
|
|
38
|
|
Interest
expense
|
(74)
|
|
(72)
|
|
(339)
|
|
(263)
|
|
Income tax (expense)
benefit (6)
|
(73)
|
|
(54)
|
|
(179)
|
|
(56)
|
|
Noncontrolling
interest share of interest and tax (a) (8)
|
4
|
|
2
|
|
7
|
|
5
|
|
Income (loss) from
continuing operations, net of tax
|
(63)
|
|
(60)
|
|
257
|
|
160
|
|
Income (loss) from
discontinued operations, net of tax
|
(2)
|
|
—
|
|
10
|
|
—
|
|
Net income (loss)
attributable to Bunge (8)
|
(65)
|
|
(60)
|
|
267
|
|
160
|
|
Convertible
preference share dividends
|
(9)
|
|
(9)
|
|
(34)
|
|
(34)
|
|
Net income (loss)
available to Bunge common shareholders
|
$
|
(74)
|
|
$
|
(69)
|
|
$
|
233
|
|
$
|
126
|
|
|
|
|
|
|
Net income (loss)
per common share diluted attributable to Bunge
common shareholders (9)
|
|
|
|
|
Continuing
operations
|
$
|
(0.51)
|
|
$
|
(0.48)
|
|
$
|
1.57
|
|
$
|
0.89
|
|
Discontinued
operations
|
(0.01)
|
|
—
|
|
0.07
|
|
—
|
|
Net income (loss)
per common share - diluted
|
$
|
(0.52)
|
|
$
|
(0.48)
|
|
$
|
1.64
|
|
$
|
0.89
|
|
Weighted–average
common shares outstanding - diluted
|
141
|
|
141
|
|
142
|
|
141
|
|
|
(a) The line items
"EBIT attributable to noncontrolling interest" and "Noncontrolling
interest share of interest and tax" when combined, represent
consolidated Net (income) loss attributed to noncontrolling
interests on a U.S. 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
December 31,
|
Year Ended
December 31,
|
(US$ in millions, except volumes)
|
2018
|
2017
|
2018
|
2017
|
Volumes (in
thousands of metric tons):
|
|
|
|
|
Agribusiness
|
35,416
|
|
34,343
|
|
146,309
|
|
142,855
|
|
Edible Oil
Products
|
2,423
|
|
2,050
|
|
9,024
|
|
7,731
|
|
Milling
Products
|
1,141
|
|
1,160
|
|
4,604
|
|
4,460
|
|
Sugar &
Bioenergy
|
1,537
|
|
2,712
|
|
6,509
|
|
9,389
|
|
Fertilizer
|
454
|
|
499
|
|
1,328
|
|
1,329
|
|
|
|
|
|
|
Net
sales:
|
|
|
|
|
Agribusiness
|
$
|
8,114
|
|
$
|
7,904
|
|
$
|
32,206
|
|
$
|
31,741
|
|
Edible Oil
Products
|
2,357
|
|
2,141
|
|
9,129
|
|
8,018
|
|
Milling
Products
|
429
|
|
406
|
|
1,691
|
|
1,575
|
|
Sugar &
Bioenergy
|
483
|
|
1,002
|
|
2,257
|
|
4,054
|
|
Fertilizer
|
160
|
|
152
|
|
460
|
|
406
|
|
Total
|
$
|
11,543
|
|
$
|
11,605
|
|
$
|
45,743
|
|
$
|
45,794
|
|
Gross
profit:
|
|
|
|
|
Agribusiness
|
$
|
203
|
|
$
|
238
|
|
$
|
1,434
|
|
$
|
933
|
|
Edible Oil
Products
|
171
|
|
141
|
|
554
|
|
499
|
|
Milling
Products
|
52
|
|
54
|
|
227
|
|
209
|
|
Sugar &
Bioenergy
|
(36)
|
|
21
|
|
(19)
|
|
99
|
|
Fertilizer
|
32
|
|
8
|
|
70
|
|
25
|
|
Total
|
$
|
422
|
|
$
|
462
|
|
$
|
2,266
|
|
$
|
1,765
|
|
Selling, general
and administrative expenses:
|
|
|
|
|
Agribusiness
|
$
|
(204)
|
|
$
|
(222)
|
|
$
|
(740)
|
|
$
|
(805)
|
|
Edible Oil
Products
|
(107)
|
|
(103)
|
|
(412)
|
|
(361)
|
|
Milling
Products
|
(33)
|
|
(35)
|
|
(136)
|
|
(138)
|
|
Sugar &
Bioenergy
|
(21)
|
|
(27)
|
|
(112)
|
|
(114)
|
|
Fertilizer
|
(4)
|
|
(6)
|
|
(23)
|
|
(19)
|
|
Total
|
$
|
(369)
|
|
$
|
(393)
|
|
$
|
(1,423)
|
|
$
|
(1,437)
|
|
Foreign exchange
gains (losses):
|
|
|
|
|
Agribusiness
|
$
|
12
|
|
$
|
(8)
|
|
$
|
(104)
|
|
$
|
85
|
|
Edible Oil
Products
|
(2)
|
|
(1)
|
|
—
|
|
3
|
|
Milling
Products
|
(2)
|
|
(2)
|
|
2
|
|
(3)
|
|
Sugar &
Bioenergy
|
7
|
|
1
|
|
7
|
|
11
|
|
Fertilizer
|
—
|
|
(3)
|
|
(6)
|
|
(1)
|
|
Total
|
$
|
15
|
|
$
|
(13)
|
|
$
|
(101)
|
|
$
|
95
|
|
Segment
EBIT:
|
|
|
|
|
Agribusiness
|
$
|
33
|
|
$
|
26
|
|
$
|
645
|
|
$
|
256
|
|
Edible Oil
Products
|
53
|
|
28
|
|
122
|
|
126
|
|
Milling
Products
|
17
|
|
15
|
|
90
|
|
63
|
|
Sugar &
Bioenergy
|
(48)
|
|
(13)
|
|
(135)
|
|
(12)
|
|
Fertilizer
|
27
|
|
(1)
|
|
39
|
|
3
|
|
Unallocated
(6)
|
(12)
|
|
—
|
|
(24)
|
|
—
|
|
Total Segment EBIT
(7)
|
$
|
70
|
|
$
|
55
|
|
$
|
737
|
|
$
|
436
|
|
Condensed
Consolidated Balance Sheets (Unaudited)
|
|
|
December
31,
|
December
31,
|
(US$ in
millions)
|
2018
|
2017
|
Assets
|
|
|
Cash and cash
equivalents
|
$
|
389
|
|
$
|
601
|
|
Trade accounts
receivable, net
|
1,637
|
|
1,501
|
|
Inventories
(10)
|
5,871
|
|
5,074
|
|
Other current
assets
|
3,171
|
|
3,227
|
|
Total current
assets
|
11,068
|
|
10,403
|
|
Property, plant and
equipment, net
|
5,201
|
|
5,310
|
|
Goodwill and other
intangible assets, net
|
1,424
|
|
838
|
|
Investments in
affiliates
|
451
|
|
461
|
|
Time deposits under
trade structured finance program
|
—
|
|
315
|
|
Other non-current
assets
|
1,281
|
|
1,544
|
|
Total
assets
|
$
|
19,425
|
|
$
|
18,871
|
|
|
|
|
Liabilities and
Equity
|
|
|
Short-term
debt
|
$
|
750
|
|
$
|
304
|
|
Current portion of
long-term debt
|
419
|
|
15
|
|
Letter of credit
obligations under trade structured finance program
|
—
|
|
315
|
|
Trade accounts
payable
|
3,501
|
|
3,395
|
|
Other current
liabilities
|
2,502
|
|
2,186
|
|
Total current
liabilities
|
7,172
|
|
6,215
|
|
Long-term
debt
|
4,203
|
|
4,160
|
|
Other non-current
liabilities
|
1,248
|
|
1,139
|
|
Total
liabilities
|
12,623
|
|
11,514
|
|
Redeemable
noncontrolling interests
|
424
|
|
—
|
|
Total
equity
|
6,378
|
|
7,357
|
|
Total liabilities,
redeemable noncontrolling interest and equity
|
$
|
19,425
|
|
$
|
18,871
|
|
Condensed
Consolidated Statements of Cash
Flows (Unaudited)
|
|
|
Year Ended
December 31,
|
(US$ in
millions)
|
2018
|
2017
|
Operating
Activities
|
|
|
Net income
(8)
|
$
|
287
|
|
$
|
174
|
|
Adjustments to
reconcile net income (loss) to cash provided by (used for)
operating
activities:
|
|
|
Impairment charges
|
18
|
|
52
|
|
Foreign
exchange (gain) loss on net debt
|
139
|
|
21
|
|
Depreciation, depletion and amortization
|
622
|
|
609
|
|
Deferred
income tax
|
6
|
|
(23)
|
|
Other,
net
|
156
|
|
72
|
|
Changes in operating
assets and liabilities, excluding the effects of
acquisitions:
|
|
|
Trade
accounts receivable
|
(110)
|
|
95
|
|
Inventories
|
(1,107)
|
|
(130)
|
|
Secured
advances to suppliers
|
41
|
|
172
|
|
Trade
accounts payable and accrued liabilities
|
336
|
|
50
|
|
Advances
on sales
|
22
|
|
11
|
|
Net
unrealized gain (loss) on derivative contracts
|
145
|
|
105
|
|
Margin
deposits
|
(106)
|
|
(5)
|
|
Marketable securities
|
52
|
|
(128)
|
|
Beneficial interest in securitized trade receivables
(11)
|
(1,909)
|
|
(3,001)
|
|
Other,
net
|
144
|
|
(49)
|
|
Cash provided by (used for) operating activities
|
(1,264)
|
|
(1,975)
|
|
Investing
Activities
|
|
|
Payments made for
capital expenditures
|
(493)
|
|
(662)
|
|
Acquisitions of
businesses (net of cash acquired)
|
(981)
|
|
(369)
|
|
Settlement of net
investment hedges
|
66
|
|
(20)
|
|
Proceeds from
beneficial interest in securitized trade receivables
(11)
|
1,888
|
|
2,981
|
|
Proceeds from
investments
|
1,098
|
|
961
|
|
Payments for
investments
|
(1,184)
|
|
(944)
|
|
Payments for
investments in affiliates
|
(4)
|
|
(126)
|
|
Other, net
|
20
|
|
(2)
|
|
Cash provided by (used for) investing activities
|
410
|
|
1,819
|
|
Financing
Activities
|
|
|
Net borrowings
(repayments) of short-term debt
|
486
|
|
42
|
|
Net proceeds
(repayments) of long-term debt
|
470
|
|
44
|
|
Proceeds from the
exercise of options for common shares
|
11
|
|
59
|
|
Dividends paid
(12)
|
(313)
|
|
(297)
|
|
Other, net
|
(23)
|
|
(28)
|
|
Cash provided by (used for) financing activities
|
631
|
|
(180)
|
|
Effect of exchange
rate changes on cash and cash equivalents, and restricted
cash
|
11
|
|
3
|
|
Net increase
(decrease) in cash and cash equivalents, and restricted
cash
|
(212)
|
|
(333)
|
|
Cash and cash
equivalents, and restricted cash, beginning of
period
|
605
|
|
938
|
|
Cash and cash
equivalents, and restricted cash, end of period
|
$
|
393
|
|
$
|
605
|
|
- 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") and Total Segment EBIT, adjusted, to
evaluate Bunge's operating performance. Total Segment EBIT excludes
EBIT attributable to noncontrolling interests and 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
industry. 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
December 31,
|
Year Ended
December 31,
|
(US$ in
millions)
|
2018
|
2017
|
2018
|
2017
|
Net income (loss)
attributable to Bunge
|
$
|
(65)
|
|
$
|
(60)
|
|
$
|
267
|
|
$
|
160
|
|
Interest
income
|
(10)
|
|
(9)
|
|
(31)
|
|
(38)
|
|
Interest
expense
|
74
|
|
72
|
|
339
|
|
263
|
|
Income tax expense
(benefit)
|
73
|
|
54
|
|
179
|
|
56
|
|
(Income) loss from
discontinued operations, net of tax
|
2
|
|
—
|
|
(10)
|
|
—
|
|
Noncontrolling
interest share of interest and tax
|
(4)
|
|
(2)
|
|
(7)
|
|
(5)
|
|
Total Segment
EBIT
|
70
|
|
55
|
|
737
|
|
436
|
|
Certain (gains) and
charges
|
37
|
|
100
|
|
144
|
|
141
|
|
Total Segment
EBIT, adjusted
|
$
|
107
|
|
$
|
155
|
|
$
|
881
|
|
$
|
577
|
|
- 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
December 31,
|
|
Year Ended
December 31,
|
(US$ in millions,
except per share data)
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
Net Income (loss)
attributable to Bunge
|
$
|
(65)
|
|
|
$
|
(60)
|
|
|
$
|
267
|
|
|
$
|
160
|
|
Adjusted for certain
gains and charges:
|
|
|
|
|
|
|
|
Severance, employee benefit,
and other costs
|
|
11
|
|
|
52
|
|
|
49
|
|
|
61
|
|
Impairment
charges
|
|
10
|
|
|
24
|
|
|
10
|
|
|
41
|
|
Sugar restructuring
charges
|
|
2
|
|
|
6
|
|
|
10
|
|
|
22
|
|
Acquisition and integration
costs
|
|
8
|
|
|
9
|
|
|
19
|
|
|
9
|
|
Loss on extinguishment of
debt
|
|
10
|
|
|
—
|
|
|
19
|
|
|
—
|
|
Gain (loss), net on
disposition of equity investments and
subsidiaries
|
|
—
|
|
|
(6)
|
|
|
29
|
|
|
(6)
|
|
Indirect tax (credits)
charges, net
|
|
(7)
|
|
|
(8)
|
|
|
(7)
|
|
|
(16)
|
|
Interest and income tax
charges (benefits), net
|
|
49
|
|
|
86
|
|
|
34
|
|
|
37
|
|
Adjusted Net
Income attributable to Bunge
|
18
|
|
|
103
|
|
|
430
|
|
|
308
|
|
Discontinued
Operations
|
|
2
|
|
|
—
|
|
|
(10)
|
|
|
—
|
|
Convertible Preference
shares dividends
|
|
(9)
|
|
|
(9)
|
|
|
(34)
|
|
|
(34)
|
|
Net income (loss)
- adjusted (excluding certain gains &
charges and discontinued operations)
|
$
|
11
|
|
|
$
|
94
|
|
|
$
|
386
|
|
|
$
|
274
|
|
Weighted-average
common shares outstanding - diluted
|
142
|
|
|
141
|
|
|
142
|
|
|
141
|
|
Net income (loss)
per common share - diluted, adjusted
(excluding certain gains & charges and discontinued
operations)
|
$
|
0.08
|
|
|
$
|
0.67
|
|
|
$
|
2.72
|
|
|
$
|
1.94
|
|
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
December 31,
|
|
Year Ended
December 31,
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
Continuing
operations:
|
|
|
|
|
|
|
|
Net income (loss) per
common share - diluted adjusted
(excluding certain gains & charges and discontinued
operations)
|
$
|
0.08
|
|
|
$
|
0.67
|
|
|
$
|
2.72
|
|
|
$
|
1.94
|
|
Certain gains &
charges (see Additional Financial Information
section)
|
(0.59)
|
|
|
(1.15)
|
|
|
(1.15)
|
|
|
(1.05)
|
|
Net income (loss) per
common share - continuing operations
|
(0.51)
|
|
|
(0.48)
|
|
|
1.57
|
|
|
0.89
|
|
Discontinued
operations:
|
(0.01)
|
|
|
—
|
|
|
0.07
|
|
|
—
|
|
Net income (loss)
per common share - diluted
|
$
|
(0.52)
|
|
|
$
|
(0.48)
|
|
|
$
|
1.64
|
|
|
$
|
0.89
|
|
- Severance, Employee Benefit and Other Costs
The following table summarizes the costs incurred as part of the
Global Competitiveness Program and other associated cost reduction
and strategic initiatives.
|
Quarter Ended
December 31, 2018
|
|
Year Ended
December 31, 2018
|
|
Severance
and
Employee
Benefit
Costs
|
Consulting
and
Professional
Services
|
Other
Program
Costs
|
Total
Costs
|
|
Severance
and
Employee
Benefit
Costs
|
Consulting
and
Professional
Services
|
Other
Program
Costs
|
Total
Costs
|
Global
Competitiveness
Program:
|
|
|
|
|
|
|
|
|
|
Agribusiness
|
$
|
1
|
|
$
|
4
|
|
$
|
4
|
|
$
|
9
|
|
|
$
|
9
|
|
$
|
18
|
|
$
|
6
|
|
$
|
33
|
|
Edible Oil
Products
|
—
|
|
1
|
|
—
|
|
1
|
|
|
2
|
|
4
|
|
1
|
|
7
|
|
Milling Products
|
—
|
|
1
|
|
—
|
|
1
|
|
|
—
|
|
3
|
|
—
|
|
3
|
|
Sugar &
Bioenergy
|
—
|
|
1
|
|
—
|
|
1
|
|
|
2
|
|
4
|
|
1
|
|
7
|
|
Fertilizer
|
—
|
|
—
|
|
—
|
|
—
|
|
|
—
|
|
1
|
|
—
|
|
1
|
|
Costs included in
Selling, general
and administrative
expenses
|
$
|
1
|
|
$
|
7
|
|
$
|
4
|
|
$
|
12
|
|
|
$
|
13
|
|
$
|
30
|
|
$
|
8
|
|
$
|
51
|
|
Other associated
cost
reduction and strategic
initiatives:
|
|
|
|
|
|
|
|
|
|
Costs included in
Cost
of goods sold
|
$
|
1
|
|
$
|
—
|
|
$
|
—
|
|
$
|
1
|
|
|
$
|
9
|
|
$
|
—
|
|
$
|
—
|
|
$
|
9
|
|
Total GCP and
Other
costs
|
$
|
2
|
|
$
|
7
|
|
$
|
4
|
|
$
|
13
|
|
|
$
|
22
|
|
$
|
30
|
|
$
|
8
|
|
$
|
60
|
|
|
Quarter Ended
December 31, 2017
|
|
Year Ended
December 31, 2017
|
|
Severance
and
Employee
Benefit
Costs
|
Consulting
and
Professional
Services
|
Total
Costs
|
|
Severance
and
Employee
Benefit
Costs
|
Consulting
and
Professional
Services
|
Total
Costs
|
Global
Competitiveness Program:
|
|
|
|
|
|
|
|
Agribusiness
|
$
|
23
|
|
$
|
7
|
|
$
|
30
|
|
|
$
|
27
|
|
$
|
10
|
|
$
|
37
|
|
Edible Oil
Products
|
6
|
|
2
|
|
8
|
|
|
6
|
|
4
|
|
10
|
|
Milling Products
|
1
|
|
1
|
|
2
|
|
|
2
|
|
1
|
|
3
|
|
Sugar &
Bioenergy
|
1
|
|
2
|
|
3
|
|
|
1
|
|
3
|
|
4
|
|
Fertilizer
|
1
|
|
—
|
|
1
|
|
|
1
|
|
—
|
|
1
|
|
Costs included in
Selling, general
and administrative expenses
|
$
|
32
|
|
$
|
12
|
|
$
|
44
|
|
|
$
|
37
|
|
$
|
18
|
|
$
|
55
|
|
Other associated cost
reduction and
strategic initiatives:
|
|
|
|
|
|
|
|
Costs included in Cost of goods sold
|
$
|
20
|
|
$
|
—
|
|
$
|
20
|
|
|
$
|
22
|
|
$
|
—
|
|
$
|
22
|
|
Total GCP and Other
costs
|
$
|
52
|
|
$
|
12
|
|
$
|
64
|
|
|
$
|
59
|
|
$
|
18
|
|
$
|
77
|
|
2017 baseline total SG&A was $1.45
billion. There was $100
million of SG&A determined not to be addressable through
the GCP, leaving 2017 addressable baseline SG&A of $1.35 billion ("Addressable Baseline"). The
items that are not addressable by the GCP relate to costs other
than direct spending and personnel costs, such as amortization, bad
debt charges and recoveries and financing fees and taxes.
GCP savings are determined by comparing Adjusted Actual
Addressable SG&A to the Addressable Baseline. Adjusted
Actual Addressable SG&A is equal to the total reported SG&A
minus the items not addressable by the GCP, plus or minus items
such as:
- GCP program costs which include severance and related employee
costs, consulting and professional costs and other costs
specifically designated to the program,
- Changes in inflation and foreign exchange rates as compared to
Addressable Baseline assumptions,
- Perimeter changes relating to acquisitions and divestitures and
corporate transactions,
- Changes in variable compensation relating to business
performance as compared to the Addressable Baseline assumptions,
and
- Identified investments in new or enhanced capabilities.
We expect to reduce Actual Addressable SG&A from the
Addressable Baseline level of $1.35
billion to $1.1 billion by
2020, achieving $250 million in
run-rate savings by the end of 2019.
As previously announced, the Company has developed a high-level
estimate of $200 - $300 million for the total pre-tax costs expected
to be incurred in connection with the Global Competitiveness
Program.
(1)
Agribusiness:
|
|
|
2018 fourth quarter
EBIT includes charges related to the GCP of $(9) million [$(1)
million for severance and other employee benefit costs and $(8)
million for other program costs], all of which was included in
Selling, general and administrative expenses
(SG&A). 2018 fourth quarter EBIT also includes $(2)
million for indirect tax charges, recorded in SG&A, related to
a court ruling in Europe, and $(1) million for severance and other
employee benefit costs related to other industrial initiatives and
$(10) million of impairment charges related to port assets in
Poland recorded in Cost of goods sold (COGS).
|
|
|
|
2017 fourth quarter
EBIT includes charges related to the GCP of $(30) million [$(23)
million for severance and other employee benefit costs and $(7)
million for other program costs], all of which was included in
SG&A. 2017 fourth quarter EBIT also includes $(12)
million for severance and other employee benefits related to other
industrial initiatives recorded in COGS. Additionally,
$(19) million of impairment charges [comprised of $(10) million
associated with the sale of feedmills in China and $(9) million
related to port assets in Poland] and a $9 million gain on the sale
of a subsidiary in Brazil were recorded. Of these amounts,
$(3) million was included within SG&A.
|
|
|
|
2018 full year EBIT
includes charges related to the GCP of $(33) million [$(9) million
for severance and other employee benefit costs and $(24) million
for other program costs], all of which was included in
SG&A. 2018 full year EBIT also included $(2) million for
indirect tax charges, recorded in SG&A, related to a court
ruling in Europe, and $(6) million for severance and other employee
benefit costs related to other industrial initiatives and $(10)
million of impairment charges related to port assets in Poland,
recorded in COGS and a net $(13) million loss on sales of an equity
investment and a subsidiary.
|
|
|
|
2017 full year EBIT
includes charges related to the GCP of $(37) million [$(27) million
for severance and other employee benefit costs and $(10) million
for other program costs], all of which was included in
SG&A. 2017 full year EBIT also includes $(12)
million for severance and other employee benefits related to other
industrial initiatives recorded in COGS. Additionally, $(36)
million of impairment charges [comprised of $(13) million for our
palm oil plantation joint venture, $(4) million for on intangible
assets related to patents, $(10) million associated with the sale
of feedmills in China, and $(9) million related to port assets in
Poland] and a $9 million gain on the sale of a subsidiary in Brazil
were recorded. Of these amounts, $(7) million was included within
SG&A.
|
|
|
(2) Edible Oil
Products:
|
|
|
2018 fourth quarter
EBIT includes charges related to the GCP of $(1) million for other
program costs, all of which was included in SG&A.
Additionally, $6 million of ICMS tax credits in Brazil and $(8)
million of acquisition and integration costs related to the
acquisition of IOI Loders Croklaan were recorded within
SG&A.
|
|
|
|
2017 fourth quarter
EBIT includes charges related to the GCP of $(8) million [$(6)
million for severance and other employee benefit costs and $(2)
million for other program costs], all of which was included in
SG&A. 2017 fourth quarter EBIT also includes $(5) million
for severance and other employee benefits related to other
industrial initiatives recorded in COGS. Additionally, $(9)
million of acquisition costs related to Loders were incurred, all
of which were included within SG&A.
|
|
|
|
2018 full year EBIT
includes charges related to the GCP of $(7) million [$(2) million
for severance and other employee benefit costs and $(5) million for
other program costs], all of which was included in SG&A.
Additionally, $6 million of ICMS tax credits in Brazil and $(19)
million of acquisition and integration costs related to the
acquisition of IOI Loders Croklaan were recorded within
SG&A.
|
|
|
|
2017 full year EBIT
includes charges related to the GCP of $(10) million [$(6) million
for severance and other employee benefit costs and $(4) million for
other program costs], all of which was included in SG&A.
2017 full year EBIT also includes $(6) million for severance and
other employee benefits related to other industrial initiatives
recorded in COGS. Additionally, $(1) million of impairment
charges for intangible assets related to patents, and $(9) million
of acquisition costs related to Loders were incurred. Of
these amounts, $(10) million was included within SG&A.
|
|
|
(3) Milling
Products:
|
|
|
2018 fourth quarter
EBIT includes charges related to the GCP of $(1) million for other
program costs, all of which was included in SG&A.
Additionally, $1 million of ICMS tax credits in Brazil, were
recorded within SG&A.
|
|
|
|
2017 fourth quarter
EBIT includes charges related to the GCP of $(2) million [$(1)
million for severance and other employee benefit costs and $(1)
million for other program costs], all of which was included in
SG&A. 2017 fourth quarter EBIT also includes $(3) million
for severance and other employee benefits related to other
industrial initiatives recorded in COGS.
|
|
|
|
2018 full year EBIT
includes charges related to the GCP of $(3) million for other
program costs, all of which was included in SG&A.
2018 full year EBIT also includes $(1) million for severance and
other employee benefit costs related to other industrial
initiatives recorded in COGS. Additionally, $1 million of
ICMS tax credits in Brazil, were recorded within
SG&A.
|
|
|
|
2017 full year EBIT
includes charges related to the GCP of $(3) million [$(2) million
for severance and other employee benefit costs and $(1) million for
other program costs], all of which was included in SG&A.
2017 full year EBIT also includes $(4) million for severance and
other employee benefits related to other industrial initiatives
recorded in COGS. Additionally, $(1) million of impairment
charges for intangible assets related to patents were
incurred. Of these amounts, $(1) million was included within
SG&A.
|
|
|
(4) Sugar &
Bioenergy:
|
|
|
2018 fourth quarter
EBIT includes charges related to the GCP of $(1) million for other
program costs, all of which was included in SG&A. 2018
fourth quarter EBIT also includes indirect tax credits in Brazil of
$3 million and Sugar restructuring charges of $(2) million recorded
in COGS.
|
|
|
|
2017 fourth quarter
EBIT includes charges related to the GCP of $(3) million [$(1)
million for severance and other employee benefit costs and $(2)
million for other program costs], all of which was included in
SG&A. Additionally, $(4) million of impairment charges
related to an equity investment in Brazil were incurred. 2017
fourth quarter charges also include Sugar restructuring charges of
$(6) million and a gain of $8 million related to indirect tax
credits. Of these amounts, $0 million was included within
SG&A.
|
|
|
|
2018 full year EBIT
includes charges related to the GCP of $(7) million [$(2) million
for severance and other employee benefit costs and $(5) million for
other program costs], all of which was included in SG&A.
2018 full year EBIT also includes indirect tax credits in Brazil of
$3 million and Sugar restructuring charges of $(10) million
recorded in COGS and a loss of $(16) million on the sale of an
equity investment in Brazil, recorded in Other income (expense) -
net.
|
|
|
|
2017 full year EBIT
includes charges related to the GCP of $(4) million [$(1) million
for severance and other employee benefit costs and $(3) million for
other program costs], all of which was included in SG&A.
Additionally, $(5) million of impairment charges were incurred
[comprised of $(4) million related to an equity investment in
Brazil and $(1) million for intangible assets related to
patents]. Of these amounts, $(1) million was included within
SG&A. 2017 full year charges also include Sugar restructuring
charges of $(22) million and a gain of $16 million related to
indirect tax credits. Of these amounts, $(1) million was
included within SG&A.
|
|
|
(5)
Fertilizer:
|
|
|
2018 full year EBIT
includes charges related to the GCP of $(1) million for other
program costs, all of which was included in SG&A.
2018 full year EBIT also includes $(2) million for severance and
other employee benefit costs related to other industrial
initiatives recorded in COGS.
|
|
|
|
2017 fourth quarter
and full year EBIT includes charges related to the GCP of $(1)
million for severance and other employee benefit costs, all of
which was included in Selling, general and administrative
expenses. 2017 fourth quarter and full year EBIT also
includes $(13) million for severance and other employee benefits
related to other industrial initiatives recorded in Cost of goods
sold. Additionally, $(2) million of impairment and other
charges related to the closure of a plant were incurred. Of
these amounts, $0 million was included within Selling, general and
administrative expenses.
|
|
|
(6) Interest,
Income Taxes and Other Unallocated:
|
|
|
2018 fourth quarter
and full year EBIT includes losses on the extinguishment of debt of
$(12) million and $(24) million, respectively.
|
|
|
|
2018 fourth quarter
and full year interest expense includes pretax interest benefits of
$9 million ($7 million net of tax) related to the reversal of
interest related to ICMS tax credits in Brazil and pretax interest
charges of $(3) million ($(3) million net of tax) related to
indirect tax charges related to a court ruling in
Europe.
|
|
|
|
2018 fourth quarter
income tax benefits (charges) of $(53) million includes charges for
valuation allowances in South America and Asia of $(48) million and
adjustments for tax reform impacts of $(5) million.
Additionally, in the third quarter of 2018, a benefit of $15
million for the favorable resolution of uncertain tax positions in
North America was recorded, resulting in a year to date charge of
$(38) million.
|
|
|
|
2017 fourth quarter
income tax benefits (charges) include charges for tax reform
impacts in North and South America of $(66) million, and valuation
allowances in Europe offset by a valuation allowance release in
Asia, for a net charge of $(20) million. Additionally,
in the second quarter, a benefit of $32 million for the favorable
resolution of an uncertain tax position in Asia and a benefit of
$17 million as a result of a tax election in South America were
recorded.
|
|
|
|
|
Notes to Financial
Tables:
|
|
(7)
|
See Definition and
Reconciliation of Non-GAAP Measures.
|
|
|
(8)
|
A reconciliation of Net
income (loss) attributable to Bunge to Net income (loss) is as
follows:
|
|
Year Ended
December 31,
|
|
2018
|
|
2017
|
Net income (loss)
attributable to Bunge
|
$
|
267
|
|
|
$
|
160
|
|
EBIT attributable to
noncontrolling interest
|
27
|
|
|
19
|
|
Noncontrolling
interest share of interest and tax
|
(7)
|
|
|
(5)
|
|
Net income
(loss)
|
$
|
287
|
|
|
$
|
174
|
|
(9)
|
Approximately 5
million and 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
quarter and year ended December 31, 2018, respectively.
Additionally, 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 quarter and
year ended December 31, 2018.
|
|
|
|
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
quarter and year ended December 31, 2017. Additionally,
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 quarter and year ended December 31,
2017.
|
|
|
(10)
|
Includes readily
marketable inventories of $4,532 million and $4,056 million at
December 31, 2018 and 2017, respectively. Of these amounts,
$3,374 million and $2,767 million, respectively, can be
attributable to merchandising activities.
|
|
|
(11)
|
In accordance with
new cash flow presentation requirements under U.S. Generally
Accepted Accounting Principles, cash receipts from payments on
beneficial interests in securitized trade receivables should be
classified as cash inflows from investing activities. As such, we
have made necessary changes to our cash flow presentation in
current and prior periods presented, which resulted in an increase
in cash inflows from investing activities and a corresponding
decrease to cash from operating activities.
|
|
|
(12)
|
Dividends paid is
comprised of the following:
|
|
Year Ended
December 31,
|
|
2018
|
|
2017
|
Dividends paid to
common shareholders
|
$
|
(271)
|
|
|
$
|
(247)
|
|
Dividends paid to
preference shareholders
|
(34)
|
|
|
(34)
|
|
Dividends paid to
noncontrolling interests
|
(8)
|
|
|
(16)
|
|
Total dividends
paid
|
$
|
(313)
|
|
|
$
|
(297)
|
|
(13)
|
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.
|
|
|
(14)
|
A reconciliation of
Cash provided by (used for) operating activities to Adjusted funds
from operations is as follows:
|
|
Year Ended
December 31,
|
|
2018
|
|
2017
|
Cash provided by
(used for) operating activities
|
$
|
(1,264)
|
|
|
$
|
(1,975)
|
|
Foreign exchange gain
(loss) on net debt
|
(139)
|
|
|
(21)
|
|
Working capital
changes
|
2,492
|
|
|
2,880
|
|
Adjusted funds
from operations
|
$
|
1,089
|
|
|
$
|
884
|
|
View original
content:http://www.prnewswire.com/news-releases/bunge-reports-fourth-quarter-and-full-year-2018-results-300799427.html
SOURCE Bunge Limited