CPI reports strong growth in Q1 based on pricing advantages
revenue for the first quarter ended March 2008, over the same
quarter of the prior year, driven largely by its performance and
pricing in the Americas.
"Our North and South American businesses should continue to drive our improved performance for the balance of 2008," said Sam Scott, chairman, president and CEO of Corn Products International (CPI). Headquartered in Westchester, Illinois, CPI is a global producer of agriculturally-derived ingredients, namely from corn. The company supplies starches, sweeteners and other ingredients, and claims to be the largest producer of dextrose and a regional leader in starches, syrups and glucose. The firm reported what it said is a record quarterly income of $64mn over the previous comparable quarter when this sum stood at $50mn. CPI's operating income meanwhile grew by 22 percent from $87.8mn in Q1 2007 to $106.7mn in Q1 2008. According to the firm, net sales grew for the ninth consecutive quarter, reaching $931mn. "The net sales growth was predominantly the result of strong pricing actions, product mix improvement, and favorable currency translation. Volumes fell slightly due to lower customer demand," stated CPI's financial report. In North America, CPI indicated volumes were unfavorable owing to poor weather conditions and an equally harsh economic climate, which impacted customer takeaway. The company's South American division - where CPI claims to be the largest corn refiner - also reported increased sales based on favorable pricing, product mix and foreign currency translation. However, it indicated this was offset by lower demand from Brazilian brewers. In addition, the financial report states that in the Andean region performance was negatively impacted by start-up expenses related to an infant food program which it expects will in turn become a positive contributor towards the end of 2008. For CPI's operations in Asia and Africa, operating income improvements in Pakistan, Thailand, China and Kenya were more than offset by a decline in South Korea's operating income. The firm's Asia/Asia division focuses on processing corn and tapioca. CPI operates plants in 15 countries, including company-owned operations, joint ventures, alliances and technical agreements.