CHICAGO, ILLINOIS, US — Strong operating profit across its three major business units helped Archer Daniels Midland (ADM) deliver a 28% increase in year-over-year income in fiscal 2020.

Net income at ADM in the year ended Dec. 31, 2020, totaled $1.77 billion, equal to $3.15 per share on the common stock, up from $1.38 billion, or $2.44 per share, in fiscal 2019. In the fourth quarter, earnings totaled $687 million, or $1.22 per share, up 36% from $504 million, or 90¢ per share, in the same period a year ago.

Revenues in fiscal 2020 eased slightly to $64.36 billion from $64.66 billion. The year-over-year decline came despite stronger sales in the fourth quarter, which increased 10% to $17.98 billion from $16.33 billion a year ago.

“The team managed a wide variety of risks superbly, and we achieved our strategic initiatives, exceeding our $500 million to $600 million guidance and driving our ability to deliver a steady, sustainable earnings growth,” Juan R. Luciano, president and chief executive officer, said during a Jan. 26 conference call with analysts.

Luciano pointed to several success stories within its three “pillars” strategy of optimize the core, drive efficiency and grow strategically.

As part of the optimize pillar, he said ADM has adapted and innovated to keep its work environment safe from COVID-19, maintaining operations to support the global food value chain and delivering for customers to provide nutrition around the world. He highlighted efforts by the company’s Ag Services and Oilseeds team to deliver more than $300 million in capital reduction initiatives, and said the company remains focused on finding ways to enhance the return structure of that business from digital technologies.

In the drive pillar, ADM’s new organizational structures and business processes, including its centers of excellence and 1ADM business transformation project, are helping drive better decision-making and operational excellence, Luciano said.

“We continued our work to support our planet and its natural resources,” he said. “We achieved our 15x20 environmental goals ahead of schedule and launched Strive 35, an even more ambitious plan to reduce greenhouse gas emissions, energy, water and waste by 2035.”

Within the company’s growth pillar, ADM’s Nutrition team exceeded its Neovia synergy targets and delivered them ahead of schedule, Luciano said, adding that the company also expanded its plant-based protein capabilities, including the launch of its PlantPlus Foods joint venture.

Operating profit in the Ag Services and Oilseeds segment increased 9% in fiscal 2020 to $2.11 billion, while profit in the fourth quarter rose 13% to $834 million. Within the segment, ag services operating profit surged 65% year-over-year to $828 million, while crushing profit fell 20% to $466 million and refined products and other decreased 25% to $439 million.

“(The Ag Services and Oilseeds team) achieved multiple records, including an all-time-high in global crush volumes,” said Ray G. Young, chief financial officer. “In addition, we’re proud of the team that brought our reserve export facility back online safely and ahead of schedule despite dealing with multiple severe weather events this year. Looking ahead, we expect the first quarter of 2021 results for Ag Services and Oilseeds to be significantly higher than the prior year first quarter, driven by extremely strong North American export demand and continued healthy crush margins.”

Elaborating on the Ag Services and Oilseeds segment, Luciano said ADM expects 2021 to be “a very, very strong year” for the unit, one in which the company flexes its capabilities. He said the company expects continued strong soybean crush as well as a recovery in softseed crush after several years of softness.

“And I’ll remind you that we have about 25% of our capacity in softseed, and we have about 15% of our capacity that is shifting. So that’s a competitive advantage for ADM,” he said.

“We see a strong demand for mill, and we see also the vegetable story playing out with good global demand and prices that are today are about 20% higher than the same time last year. And not only coming from food demand but also from fuel. A new renewable green diesel capacity is having an impact in bean oil demand and margins. And we think that, that could be about 0.5 billion pounds per year this year of extra demand. So all in all, we see tight balances, and we see a strong margin environment for the rest of the year.”

Year-over-year operating profit in the Carbohydrate Solutions segment rose 11% in fiscal 2020 to $717 million, while fourth-quarter profit increased 20% to $208 million. Starches and sweeteners profit rose 1% during the full year and increased 11% in the fourth quarter.

“Considering the impact of lockdowns in both driving miles and the foodservice sector, we’re extremely proud of our Carbohydrate Solutions team for delivering full-year results of $717 million, 11% higher than 2019,” Young said. “The team achieved record-high operating profits from starches in the year. They acted decisively by temporary idling production at our two VCP (Vantage Corn Processor) dry mill plants, helping address industry supply and demand balances. And the wheat milling business’s modernization and optimization plan, including a new state-of-the-art mill in Mendota, Illinois, US, helped power a significant improvement over full-year 2019 for that business.”

In the Nutrition segment, operating profit increased to $574 million in fiscal 2020, up 37% from $418 million in fiscal 2019. Fourth-quarter profit, meanwhile, increased to $127 million from $102 million in the same period a year ago.

 “Nutrition continued to harvest investments, lead in consumer growth trends areas and partner with customers to bring innovative, new products and solutions to market in 2020,” Luciano said. “Based on our current organic growth plans, we expect the Nutrition team to deliver solid revenue expansion and enter a period of an average 15% per annum operating profit growth, consistent with our strategic plan.”