Bunge beats by $0.65, misses on revs; updates outlook
Reports Q1 (Mar) earnings of $1.41 per share, $0.65 better than the Capital IQ Consensus of $0.76; revenues fell 17.5% year/year to $8.92 bln vs the $10.12 bln Capital IQ Consensus. Outlook:
- "In Agribusiness, demand for our core products is strong. The USDA is forecasting global soy meal and oil demand each to grow 7% this year, which should be supportive of soy processing margins. Softseed processing margins should improve later in the year with the arrival of new crop seed supplies. Recent weather related changes to crop production in South America could present increased opportunities for our assets in the Northern Hemisphere. However, we expect headwinds in the second quarter as South American farmers and markets adjust to a scenario of lower production."
- "In Food & Ingredients, we expect 2016 results to be higher year-over-year, driven by our operational excellence initiatives and recent acquisitions. We are cautiously optimistic that the improved volumes and margins we are currently seeing in our Brazilian operations will continue. We expect results to be weighted to the second half of the year."
"In Fertilizer, improved farmer economics in Argentina, due to the weaker peso and the removal of export taxes on grains, should result in increased purchases of crop inputs later in the year." - "In Sugar & Bioenergy, our sugarcane crop is developing well, and considering our sugar price hedges and the Brazilian ethanol pricing outlook, we continue to expect 2016 to be a year of growth in earnings and cash flow. Similar to past years, results will be seasonally weak until the second half of the year."