Global agribusiness giant Bunge’s agribusiness third quarter earnings were down by 11% compared to the same period in the previous year.
Earnings in the segment dropped from US$528M in the same quarter of last year to US$472M, the company announced on 26 October.
Agribusiness volumes were 18.85M tonnes compared with 19.62M tonnes in the third quarter of 2022. Sales totalled US$10.08bn, down from US$11.74bn in the third quarter of the previous year.
“Agribusiness adjusted results … were down compared to last year as a slightly higher performance in processing was more than offset by lower results in merchandising,” Bunge chief financial officer John W Neppl was quoted as saying by World Grain on 27 October following a conference call with analysts the previous day.
“In processing, higher results in Brazil soyabean origination, Asia and North America were largely offset by drought impacted results in Argentina. Results in Europe were in line with last year as improved performance in soft seeds was offset by lower results in soyabean crush[ing].”
Adjusted earnings before interest and taxes (EBIT) in the Refined and Specialty Oils division was US$230M, up from US$195M in the third quarter of 2022. Sales in the quarter were US$3.6bn, down from US$4.3bn.
“Higher refining speciality oils results were primarily driven by North America,” Neppl said. “Higher results in Asia, led by our India business also contributed to the improved performance. Results in South America and Europe were lower.”
Bunge’s overall net income in the third quarter ended 30 September totalled US$373M, down from US$380M in the same period of the previous year.
Despite the slightly year-on-year earnings, Bunge raised its full year adjusted earnings/share outlook for 2023 to at least US$12.50, up from an earlier forecast of US$11.75/share issued in early August, due to solid progress on growth initiatives and its pending merger with Viterra.
Following the publication of its third quarter results, Bunge’s share price climbed as high as US$108.27 in mid-day trading on 26 October, up 5.9% from the close of US$102.18 the previous day, World Grain wrote.
Looking ahead, Bunge CEO Gregory A Heckman said the company’s merger with Viterra would help accelerate its long-term growth with greater diversification across customers, assets, geographies and crops.
“We reached an important milestone in our strategic combination with Viterra, achieving overwhelming shareholder support for the transaction that we expect to accelerate Bunge’s growth,” Heckman added.
In its agribusiness sector, Bunge said it expected full-year results to be up on the previous outlook and in line with last year driven by higher results in processing. In refined and speciality oils, full-year results were expected to be up on the previous outlook and last year’s record performance.
In the nine months ended 30 September, Bunge’s net income increased to US$1.63bn, or US$10.71/share, up 28% from US$1.27bn, or US$8.30/share, in the same period the previous year.
