Lower corn boosts Cargill earnings
Cargill Inc.'s second-quarter profit climbed by more than a third as bountiful grain harvests in the U.S. and elsewhere eased costs for its meatpacking and animal feed businesses, the company said Thursday.
Earnings for the agribusiness giant, based in suburban Minneapolis, rose to $556 million for its fiscal second quarter ended Nov. 30. Cargill's revenues fell 7% to $32.9 billion.
"Cargill posted a solid second quarter, with earnings improved in three of our four segments,"Cargill Chief Executive David MacLennan said in a statement.
Cargill's division devoted to selling animal feed and meat processing saw a significant boost due to the lower cost of grain, and the bumper U.S.crop also helped Cargill's core grain-trading business in North America, according to the company.
Cargill's food ingredients division, which includes oils, flour and cocoa, delivered the largest portion of profits in the quarter as demand rose for cocoa powder and the huge U.S. corn crop helped boost demand for ethanol, which Cargill produces.
Results in Cargill's agricultural supply chain division fell from the year-ago period, due to what the company called "an industrywide buildup in oilseed crush capacity" that hurt production across several regions.
Cargill, founded in 1865, ranks among the world's largest privately owned companies and is one of the most diverse, trading grain, energy and other commodities, processing meat, and transporting goods across a sprawling global logistics network. The company also has a financial services wing, sells steel and makes pharmaceutical ingredients.
The quarter was the company's last with Gregory Page serving as chief executive. Mr. MacLennan took on the CEO role Dec. 1, and Mr. Page moved to become executive chairman. Mr. MacLennan is a 20-year veteran of Cargill, and in the past served as chief financial officer and led the company's energy business in Geneva.
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(END) Dow Jones Newswires
January 09, 2014 09:50 ET (14:50 GMT)