NETHERLANDS — The Louis Dreyfus Co. (LDC) said its segment operating results increased by 56% to US$1.375 billion for the six-month period ended June 30, as they company leveraged its diversified business portfolio and global network to weather global trade challenges and the Russia-Ukraine crisis.
Earnings before interest, taxes, depreciation and amortization (EBITDA) increased 50% to $1.17 billion. Net income, group share increased 97% to US$662 million from US$336 million in the same period a year earlier, and net sales amounted to US$30.3 billion for the six-month period, an increase of 27%.
Operating results for the value chain segment, which includes the grains and oilseeds platform, were US$945 million compared with US$525 million in the same period a year ago.
The grains and oilseeds platform further increased operating results amid uncertain crop size prospects and concerns over ongoing supply chain logistic challenges, which were amplified by doubts cast by the Russia-Ukraine crisis.
Grain and vegetable oil prices rose rapidly in the first four to five months of 2022, driven by concerns over global supply and demand imbalances for goods usually exported from the Black Sea, and over corn and soy supply shortages due to potential drought in Argentina and Brazil.
Globally, demand for grains (particularly corn, wheat and sorghum) remained strong throughout the period as destination countries secured supply, in the wake of the opening of a grains export corridor out of Ukraine.
Ethanol prices were bolstered by the rally in oil prices, as global demand for biofuels continued to grow to support carbon emission reductions.
Despite increasing production costs due to inflation and high energy prices, processing activities contributed significantly to the platform’s performance and growth thanks to strong crushing and crack margins, particularly in the United States, Canada and Brazil.
In addition to delivering strong results, LDC continued to invest in core merchandizing operations, expansion and diversification downstream, as well as group-wide innovation and digitalization, in line with its strategic roadmap.
The company recently inaugurated its first R&D center ahead of its’s entry to the plant proteins market and also completed, and recently inaugurated a new liquid soy lecithin plant in Indiana, US, as it seeks to consolidate its position in the plant-based ingredients market.
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