|Juan Luciano, chairman and chief executive officer of ADM.|
“We continued to deliver on our strategic plan and capitalize on improving conditions in some markets to achieve strong 39% year-over-year earnings growth,” said Juan Luciano, chairman and chief executive officer of ADM. “Our actions in the first half of the year reflect ADM’s continuous efforts to create shareholder value. We are diversifying our capabilities and geographic reach through acquisitions and organic expansions. We are aggressively managing costs and capital, and taking additional portfolio actions; and we are ahead of pace to meet our 2017 target of $225 million in run-rate savings.
“With these collective actions, we expect to deliver solid year-over-year earnings growth and returns in 2017, and we are poised to be an even stronger company in 2018.”
Operating profit in the Oilseeds Processing unit was $206 million in the second quarter, down 12% from $235 million in the same period a year ago. Crushing and origination profit fell to $38 million from $135 million.
“Oilseeds Processing benefited from the diversity of its feedstocks, products and geographies; however, overall results were down compared to the second quarter of 2016,” ADM said. “Weak margins in both global soybean crush and South American origination impacted Crushing and Origination results. Softseeds earnings were higher as a result of leveraging the business’s global flex capacity to capitalize on margin opportunities.”
Agricultural Services operating profit increased 91% to $109 million from $57 million, as merchandising and handling posted a profit of $40 million after sustaining a loss of $14 million in the same year-ago period. Milling and other results rose to $58 million from $56 million, and transportation fell to $11 million from $15 million.
“In Merchandising and Handling, North America grain results increased significantly over the prior year with strong carries in wheat, corn and soybeans,” ADM said. “Global Trade generated solid results and was up over the year-ago quarter, benefiting from improved margins, favorable timing effects and actions to improve performance.”Operating profit within the Corn Processing unit increased 37% to $224 million from $163 million. Sweeteners and starches results improved $16 million to $198 million behind higher volumes and improved margins. Bioproducts turned in a profit of $26 million, which compared with a loss of $19 million a year ago, due primarily to an improvement in ethanol margins.