USA – Cargill, an American provider of food, agriculture, financial and industrial products, has reported a 5% revenue increase in results for the first quarter of fiscal 2019, which ended Aug. 31, 2018.
According to the company, the adjusted operating earnings totalled US$883 million, nearly matching the US$888 million earned in last year’s strong comparative period.
The net earnings on a U.S. GAAP basis were US$1.02 billion, up 5 percent from US$973 million in the prior-year period, while the revenues rose 5 percent to US$28.7 billion.
“Our customers are choosing Cargill more and more often because we provide them the confidence they need to win in a fast-changing world,” said David MacLennan, Cargill’s chairman and chief executive officer. ‘
“We give them an edge by connecting them to our team’s expertise, unique capabilities and global network. Whether it’s sustainably sourced foods and feeds, digitally driven insights, or supply chain risk management, we will continue innovating to provide an integrated set of solutions that meet their needs.”
Animal Nutrition & Protein segment
Adjusted operating earnings were just below last year’s strong opening quarter, lifted by another good performance in North American protein.
Domestic and international demand for beef remained strong, as did foodservice demand for value-added egg products.
Earnings in animal nutrition lagged the prior year due to varying combinations of higher input costs, lower sales volumes and pricing pressures in different countries. This was partially offset by gains in Latin America for micronutrients, premixes and feed additives.
Food Ingredients & Applications segment
Food Ingredients & Applications delivered slightly lower earnings against a strong comparative period.
The segment posted gains in cocoa, chocolate, edible oils and malt, while earnings in starches, sweeteners and texturizers were affected by lower ethanol prices and trading results in North America and currency devaluations in emerging markets.
The segment’s salt business fell below last year’s level due to higher road salt production costs and freight rates.
The segment formed a new bioindustrial group focused on meeting the growing demand for sustainably made and sourced products serving the consumer and industrial segments.
Origination & Processing segment
Origination & Processing earnings were up appreciably from a weak comparative period. Global demand was strong and markets volatile, as weather events in key crop-growing regions and rising economic uncertainty brought the segment’s sourcing, trading, analytical and logistical skills to the fore.
Regionally, Asia Pacific improved performance with good trading and oilseed processing results, while North America and Europe realized solid oilseed processing results in canola, soybeans and biodiesel.
Industrial & Financial Services
Industrial & Financial Services trailed the prior year due to lower returns from Cargill’s asset management activities.
The decrease was partially offset by good performance in trade finance and commodity risk management, where teams helped customers steer through the volatility that returned to global commodities markets.
The ocean transportation business demonstrated leadership in decarbonizing the shipping industry by committing to reduce its carbon dioxide output per cargo-ton-mile by 15 percent by the end of 2020.
To help achieve this goal, it launched a “CO2 Challenge” that will seek to uncover and scale new technologies to lower ships’ emissions.
Cargill also is committed to continuing to strengthen women farmers’ prosperity as they grow their farming operations.
The program will equip 300 farming households in the first year with best practices in animal husbandry, biosecurity, farm management and more.
Cargill also is establishing a dozen demonstration farms as a resource to these producers.
The China Women’s Development Foundation has been recognized by the Chinese government with its top honor for charitable organizations.
“Women are at the heart of farming communities everywhere. When they have an opportunity to earn an income, that whole community thrives,” MacLennan said.
“We are proud to work alongside our partners to advance women’s prosperity, which in turn will propel social and economic development.”