ROTTERDAM, THE NETHERLANDS — Net income at Louis Dreyfus Co. (LDC) for the year 2018 ended Dec. 31, 2018, totaled $357 million, up 88.5% from $316 million in 2017.

Net sales fell 4.1% to $36.5 billion from $38 billion in 2017 due to an 8.8% decrease in volumes shipped.

“LDC achieved excellent results in 2018, confirming the ability of our teams to adapt to change, focus on priorities and implement our strategy, which positions us well for our next phase of growth,” said Margarita Louis-Dreyfus, chairperson of Louis Dreyfus Holding B.V. “Our long-standing vision is to work toward a safe and sustainable future, contributing to the global effort to provide sustenance for a growing world population — profitably, reliably and sustainably. This places us at the heart of some of the world’s most pressing challenges. It is within this context that the company purpose to create fair and sustainable value takes on its full meaning. Alongside the supervisory board, I will continue to ensure that we have the right strategy and resources to achieve our long-term vision.”

In 2018, LDC reorganized its platforms between two segments. The Value Chain Segment now includes Grains, Oilseeds and Juice along with Freight and Global Markets. The Merchandizing segment comprises the Sugar, Coffee, Cotton, Rice and Dairy platforms with more consumer-centric business models.

The Value Chain segment’s net sales were down 5.5% largely due to a reduction in volumes shipped following the sale of the fertilizers and inputs business, non-core asset divestments in the Grains Platform.

The Merchandizing segment’s net sales remained stable, with a 0.9% decrease reflecting mixed trends. The cotton and rice platforms sold higher volumes, while other platforms’ sales volumes went down, at lower average prices.

In a year characterized by challenging market conditions for the products commercialized by the group, segment operating results increased nearly 26% to $1.33 billion in 2018, up from $1.057 billion on year earlier.

According to LDC, tensions in U.S.-China trade relations in particular resulted, on the one hand, in a rebound price volatility for commodities like soybeans and, on the other hand, in shift of global trade flows.

“Our results clearly demonstrate our capacity to rise to the challenge of managing differing trends among business platforms and the fallout of global trade tensions,” said Ian McIntosh, chief executive officer of Louis Dreyfus Company. “We also continued to refocus on our core businesses in 2018, while pursuing strategic investments for growth in key origination and destination markets, and making our first investments in food innovation.”

The Value Chain Segments’ operation results reached $830 million, up a shade more than 16% from $714 million in 2017.

Supported by higher volatility in 2018, the Grains platform improved its margins on recurring activities. LDC noted the profitability of wheat and corn operations improved, especially in EMEA and South and West Latin America, by focusing on building its customer relations.   

“North American elevation assets, attributable to the U.S.-China trade tensions and the closure of non-strategic assets there, was counterbalanced improvement by improved asset utilization in our two South American regions, leading satisfactory margins,” LDC said. “The Grain platform’s performance was negatively impacted by a $26 million impairment on some of its assets located in the U.S. and Australia.”

McIntosh added, “We posted a very good performance for 2018, supported by a strong second half of the year, as expected, and despite lower sales and volumes due to divestments. This was made possible thanks to our globally diversified portfolio and geographic footprint, together with active risk management. Our results and achievements during the year confirm my view that we have the right teams and the right strategy to write a new and exciting growth chapter for LDC.”