Archer Daniels Midland Company
4666 Faries Parkway Decatur, Illinois 62526
News Release
FOR IMMEDIATE RELEASE April 29, 2008
ARCHER DANIELS MIDLAND REPORTS THIRD QUARTER RESULTS
Net earnings for the quarter ended March 31, 2008 increased 42 % to $ 517 million - $ .80 per share from $ 363 million - $ .56 per share last year.
“ADM’s third-quarter performance demonstrates the ability of our balanced operations, global network and solid balance sheet to deliver strong results amid fluid markets,” said Patricia Woertz, Chairman and CEO. “Volatility in commodity markets presented unprecedented opportunities. Once again, our team leveraged our financial flexibility and global asset base to capture those opportunities to deliver shareholder value.”
Financial Highlights
(Amounts in millions, except per share data and percentages)
Net sales and other operating income increased 64 % to $ 18.7 billion for the quarter ended March 31, 2008.
• Selling prices increased due principally to sharp rises in commodity prices.
Third quarter segment operating profit increased 54 % to $ 913 million from $ 593 million last year.
Oilseeds Processing operating profit increased as global demand for protein and oil improved.
Corn Processing operating profit decreased due principally to higher net corn costs.
Agricultural Services operating profit increased as highly volatile market conditions provided exceptional merchandising opportunities.
Other segment operating profit increased due to improved margins and increased financial services income.
Discussion of Operations
Net sales and other operating income increased 64 % to $ 18.7 billion for the quarter and 51 % or $ 16.2 billion for the nine months. Increased selling prices resulting primarily from sharp rises in commodity prices accounted for approximately 85 % of the increase while higher sales volumes, principally vegetable oil and meal, feed grains and wheat, accounted for the remaining 15 % increase.
Net earnings increased $ 154 million for the quarter and $ 223 million for the nine months due principally to increased segment operating profit of $ 320 million for the quarter and $ 657 million for the nine months partially offset by increased corporate expenses for LIFO inventory valuations and minority interest elimination for both the quarter and nine months. Income taxes increased $ 45 million for the quarter and $ 103 million for the nine months due principally to increased pretax earnings for both the quarter and nine months partially offset by a lower effective tax rate for the quarter due to changes in the geographic mix of earnings.
Oilseeds Processing operating profit increased $ 52 million for the quarter and $ 119 million for the nine months due principally to continuing strong global demand for protein meal and vegetable oil. Crushing and origination results increased $ 78 million for the quarter and $ 117 million for the nine months due to improved processing margins in North and South America and increased worldwide crushing volumes. Refining, packaging, biodiesel and other results decreased $ 16 million for the quarter and $ 9 million for the nine months due principally to weaker biodiesel margins in Europe. Last year’s quarter and nine month results for refining, packaging, biodiesel and other include a $ 14 million gain from business disposals.
Corn Processing Operating Profit
Corn Processing operating profit decreased $ 79 million for the quarter and $ 177 million for the nine months due primarily to increased net corn and manufacturing costs, principally energy. Partially offsetting these higher costs, sweeteners and starches selling prices increased for the quarter and nine months and sales quantities of ethanol increased for the quarter and nine months. Increases in sales prices and volumes for the quarter and nine months of lysine also favorably impacted bioproducts earnings.
Agricultural Services Operating Profit
Agricultural Services results increased $ 320 million for the quarter and $ 618 million for the nine months to record levels due principally to continuing enhanced merchandising and handling margins caused by the highly volatile global grain markets and favorable risk management results. Transportation results decreased $ 16 million for the nine months due to higher operating costs, principally fuel.
Other Operating Profit
Other operating profit increased $ 27 million for the quarter and $ 97 million for the nine months. Wheat, cocoa and malt operations improved $ 8 million for the quarter and $ 30 million for the nine months due principally to favorable risk management results in wheat and malt partially offset by decreased cocoa processing margins. Last year’s quarter and nine month wheat, cocoa and malt results include a $ 39 million gain from business disposals. Financial earnings improved $ 19 million for the quarter and $ 67 million for the nine months principally due to higher brokerage services income, decreased insurance loss provisions, marketable securities gains and improved earnings from managed fund investments.
Conference Call Information
Archer Daniels Midland Company will host a conference call and audio Web cast at 8:00 a.m. Central Time on Tuesday, April 29, 2008 to discuss financial results and provide a Company update. In addition, a financial summary slide presentation will be available to download approximately 60 minutes prior to the start of the call. To listen to the call via the Internet or to download the slide presentation, go to www.admworld.com/webcast. To listen by phone, dial 800-322-5044 or 617-614-4927; the access code is 75451708. Replay of the call will be available beginning on April 29, 2008, at 10:00 a.m. Central Time and ending May 6, 2008. To listen to the replay by telephone, dial 888-286-8010 or 617-801-6888; the access code is: 61412554. To listen to the replay online, visit www.admworld.com/webcast.
Archer Daniels Midland Company (NYSE: ADM) is the world leader in BioEnergy and has a premier position in the agricultural processing value chain. ADM is one of the world’s largest processors of soybeans, corn, wheat and cocoa. ADM is a leading manufacturer of biodiesel, ethanol, soybean oil and meal, corn sweeteners, flour and other value-added food and feed ingredients. Headquartered in Decatur, Illinois, ADM has over 27,000 employees, more than 240 processing plants and net sales for the fiscal year ended June 30, 2007 of $44 billion. Additional information can be found on ADM’s Web site at http://www.admworld.com.
Contacts:
David Weintraub Dwight Grimestad Director, External Communications Vice President, Investor Relations 217/424-5413 217/424-4586
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