Cargill reports increased Q3 earnings
first nine months, announcing close to a 50 percent increase in net
earnings for its third quarter.
The US-based agricultural firm said earnings for the three months ended February 28 2007 stood at $553m, compared to $370m in the same period a year ago. In the first nine months, Cargill earned $1.71bn, a 25 percent increase from $1.37bn last year. "The intersection we are seeing between global agriculture and energy is creating new demand as well as new challenges for all of us in agribusiness," said Warren Staley, Cargill chairman and chief executive officer. "Our team did a solid job managing the global trading, processing, distribution and risk management activities that support our customers' solutions and supply chains. Cargill's business and geographic diversity, including the outstanding performance of our financial businesses, has been a source of considerable strength this year." Results reflected increased earnings from operations as well as a reduction in income tax expense resulting from the favorable resolution of various tax matters, said the firm. Earnings in Cargill's risk management and financial, food ingredients and applications, and industrial segments increased from the third quarter a year ago. Although the origination and processing segment lagged the prior year's third quarter, it was ahead of last year for the full nine months, said Cargill in a statement. Results in agriculture services were below the prior year's level. The firm has made significant investments in food ingredients over the past year. These included Degussa's food ingredients operations, which specialize in texturizers and flavor systems for the food and beverage industry; the joint-venture purchase of oil palm plantations in Indonesia and Papua New Guinea; and the purchase of beef processing businesses in the United States and Canada. Expansions announced or under way included growth in animal nutrition, cocoa processing and oilseed processing. In August Cargill reported strong earnings for its fiscal year, although the performance of the firm's food ingredients business lagged the year-ago level. The company's revenues for the full year rose 6 percent to $75.2bn. Although earnings in the 2006 fiscal year were led by Cargill's risk management and financial segment, the company said its origination and processing segment, which comprises its global supply chain in grains, oilseeds, sugar and other agricultural commodities, also saw increased earnings from a year ago.
