|David MacLennan, chairman and chief executive officer for Minneapolis-based Cargill.
“The past two years have seen significant work to improve performance and position the company for growth,” said David MacLennan, chairman and chief executive officer for Minneapolis-based Cargill, when fiscal-year and fourth-quarter results were released July 13. “The structural improvements we’ve made, as well as favorable conditions in some markets, have yielded strong results.”
Adjusted operating earnings for the year were $3.04 billion, up 85% from $1.64 billion in the previous fiscal year. Net earnings on the basis of U.S. generally accepted accounting principles were $2.84 billion, up 19% from the previous year. Revenues increased 2% to $109.7 billion on increased sales of grain, oilseeds and metals.
The Food Ingredients & Applications segment posted improved results across global ingredient portfolios in cocoa as well as corn-based and wheat-based products. The Originating & Processing segment, after suffering a loss in last year’s fourth quarter, responded with a profit in this year’s fourth quarter as slow farmer selling in South America extended U.S. export opportunities. Earnings for the fiscal year exceed those of the previous fiscal year as record U.S. crops were met with demand from global growth in livestock production.
The Animal & Protein segment was the largest contributor to adjusted operating earnings in the fourth quarter and the full year. The protein business in North America continued to see strong consumer demand in the fourth quarter for beef at retail and for egg products from food service customers. Poultry posted higher earnings for the year thanks to increased exports of cooked chicken from Southeast Asia, higher fresh chicken sales in Europe and improved performance in China.
The Industrial & Financial Services segment benefited from increased returns from asset management investments, trading and customer-focused merchandising in North American natural gas and power markets, and performance in ocean shipping boosted by improved market conditions.
Cargill companywide in the fourth quarter reported adjusted operating earnings of $460 million, which compared to a $19 million adjusted operating loss in the previous year’s fourth quarter. Fourth-quarter net earnings rose to $347 million from $15 million, and fourth-quarter revenues rose 4% to $28.3 billion.