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Archer-Daniels-Midland: Quarter Adjusted Earnings Of

The following excerpt is from the company's SEC filing.

per Share

Net earnings of

$252 million

per share

CHICAGO, Nov. 3, 2015—Archer Daniels Midland Company (NYSE: ADM) today reported financial results for the quarter ended Sept. 30, 2015.

The company reported adjusted earnings per share

, down from

in the same period last year. Adjusted segment operating profit

$684 million

percent from

$941 million

in the year-ago period. Net earnings for the quarter were

per share, and segment operating profit

$709 million

“The ADM team executed well in an environment very simi lar to the second quarter,” said ADM Chief Executive Officer Juan Luciano. “Ag Services earnings were limited by lower margins and volumes of North American exports, due to the continued strength of the U.S. dollar and ample global crop supplies, particularly from South America.

“In Corn, we continue to confront very weak industry ethanol margins, while sweeteners and starches results remain solid amid tight supplies.

“In Oilseeds, good global meal demand again supported soy crushing results, and solid origination volumes contributed to our South American operations, while continued weak oil demand—particularly outside the U.S.—weighed on our softseeds business.

“And, in WFSI, the impact of macroeconomic headwinds—weaker demand from some emerging economies and the strong U.S. dollar—was greater than we’d expected.

“We continue to execute our strategic plan. Among other actions, we've closed on the sale of the global cocoa business, acquired Eatem Foods, and closed the Eaststarch transaction. We're also making strong progress in driving operational efficiencies, which will further enhance our cost position. And we remain committed to our balanced approach to capital allocation for our shareholders.”



Adjusted EPS of

excludes approximately $0.19 of losses on debt extinguishment, $0.04 of gains on asset sales, $0.07 of LIFO credits, $0.10 of charges related to asset impairments and restructurings, and a $0.01 charge to update the estimated annual effective tax rate.

Agricultural Services decreased

$5 million

amid lower North American export margins and volumes.

Corn Processing decreased

$176 million

on lower bioproducts results, as U.S. ethanol industry conditions remained similar to the second quarter.

Oilseeds Processing results were lower than the very strong year-ago period, as continued strong demand for protein meal was offset by weaker softseed results.

Wild Flavors and Specialty Ingredients earned

$70 million

in the third reporting period for this business unit.

Trailing four-quarter-average adjusted ROIC was

8.3 percent

basis points year over year, and

basis points above annual WACC of 6.6 percent.

During the first nine months of 2015, the company returned

$2.3 billion

to shareholders through dividends and the repurchase of 37.5 million shares.

Non-GAAP financial measures; see pages 4 and 9 for explanations and reconciliations, including after-tax amounts.

Ag Services Earnings Decline on Lower N.A. Export Volumes and Margins

Agricultural Services operating profit was

$149 million

from the year-ago period.

Merchandising and handling earnings declined

$7 million

$57 million

. While global demand for agricultural commodities remained solid throughout the quarter, ample global supplies of grain, a weak Brazilian real that motivated Brazilian farmer selling, and a strong U.S dollar reduced the competitiveness of our North American exports—particularly corn and wheat—limiting both volumes and margins. Later in the quarter, North American soybean exports became more competitive.

Transportation results declined

$4 million

$31 million

, as reduced U.S. exports lowered barge freight rates.

Milling and other results improved

$6 million

$61 million

, due mainly to higher product margins and strong merchandising results.

Corn Processing Earnings Decline with Solid Sweetener Results Offset by Lower Ethanol Results

Corn Processing operating profit decreased from

$341 million

$165 million

Sweeteners and starches results declined

$33 million

$125 million

as North American sweetener volumes and margins remained solid, but co-product margins were weaker, and the slower ramp-up of commercialized volumes at the Tianjin sweetener facility limited absorption of fixed costs.

Bioproducts results declined from

$183 million

$40 million

due to lower ethanol industry margins. While demand for ethanol domestically and from overseas markets remained solid, industry production levels were also strong, resulting in high industry inventory levels, which kept industry margins considerably lower than last year.

Oilseeds Earnings Again Solid, though Lower than Very Strong Year-ago Quarter

Oilseeds operating profit of

$276 million

$72 million

from the year-ago results.

Crushing and origination operating profit declined

$39 million

$175 million

. North American soybean crushing operations capitalized on strong meal demand in the U.S. and nearby export markets. Weak demand for vegetable oil reduced margins and volumes of softseeds operations, particularly in Europe. In South America, origination and export margins and volumes for corn and soybeans were boosted by the significant weakening of the Brazilian real and contributed to stronger South American results.

Refining, packaging, biodiesel and other generated a profit of

$66 million

for the quarter, down

$12 million

from year-ago results that benefited from $27 million in retroactively applied biodiesel blenders’ credits. This quarter's results benefited from improved margins in refined and packaged oils.

Excluding hedge timing effects and the gain from the sale of the global chocolate business, Cocoa and Other results decreased due to lower cocoa press margins and peanut processing results.

Oilseeds results in Asia for the quarter increased

from the year-ago period mainly due to improved results from Wilmar.

Wild Flavors and Specialty Ingredients Earns $70 Million...