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UPDATE 3-Bunge reports quarterly loss on tax charges, lower grain margins
(Adds estimates, share price)
By P.J. Huffstutter and Anirban Paul
CHICAGO/BANGALORE, Feb 14 (Reuters) - Bunge Ltd
reported a fourth-quarter loss on Wednesday compared with a
profit a year earlier, and blamed tax law changes and lower
margins in its grains business for its results falling far short
of analyst expectations.
White Plains, N.Y.-based Bunge said sales in its
agribusiness segment, the company's largest revenue generator,
fell 3.5 percent to $7.90 billion even as volumes rose.
JP Morgan analysts had expected sales of $8.8 billion and
said the weak result was due to lower grain originations in
South America as farmers delayed pricing of 2018 crops.
On an adjusted basis, Bunge earned a profit of 67 cents a
share in the quarter, against analyst expectations for $1.37 per
share, according to Thomson Reuters I/B/E/S. The company
reported a net loss of 48 cents per share, which includes
charges related to restructuring.
The results are expected to raise pressure on the global
agricultural trading house's management team to find a potential
buyer or take other steps to shore up its agribusiness division
amid weakening global trading and crush margins.
Bunge shares tumbled 5.7 percent to $75 in premarket
The company and other agricultural traders, including Archer
Daniels Midland Co and Cargill, have been
trying to diversify into higher-margin sectors such as food
ingredients and aquaculture amid falling grain prices.
The subject of a takeover offer by larger rival Archer
Daniels, Bunge said net loss available to shareholders was $69
million, or 48 cents per share, in the quarter ended Dec. 31,
compared with a profit of $262 million, or $1.82 per share, a
year earlier. Last year, Bunge rebuffed a takeover
approach by rival Swiss-based commodities trader Glencore.
Chief Executive Soren Schroder did not make reference to any
of the potential deals in prepared comments on Wednesday.
Instead, he said Bunge's fourth-quarter oilseed margins "did
not recover as quickly as expected," and its sugarcane milling
results suffered from extended rains late in the fourth quarter.
Schroder said Bunge was expecting a "soft first quarter,"
but conditions would improve in 2018.
Separately, Dutch food ingredients company Corbion
said on Wednesday it is in talks to buy Bunge's 49.9 percent
stake in their oil joint venture in Brazil.
Bunge took a $66 million charge due to tax law changes in
the United States and Argentina.
Net sales fell 1.6 percent to $11.61 billion.
(Editing by Maju Samuel and Bernadette Baum)
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