CHICAGO, ILLINOIS, US — Volume declines, higher manufacturing costs and increased corporate costs related to elevated interest rates dragged down earnings at ADM in fiscal 2023.

Net income in the year ended Dec. 31, 2023, totaled $3.48 billion, equal to $6.43 per share on the common stock, down 20% from $4.34 billion, or $7.71 per share, in fiscal 2022. Adjusted segment operating profit was $6.24 billion in fiscal 2023, down 6% from the previous year. The most recent year included $361 million in impairment and restructuring charges and settlement contingencies as well as $17 million in gains on the sales of assets, which compared with $147 million and $47 million, respectively, in the same period a year ago.

Revenues in fiscal 2023 totaled $93.94 billion, down 7.6% from $101.56 billion a year ago.

“To put our 2023 results into perspective, at the end of 2021, we provided the road map to create value and growth returns by getting closer to customers and highlighted where we expect it to perform on several important strategic metrics by 2025,” Juan Luciano, chairman and chief executive officer, said during a March 12 conference call with analysts. “As I look at our two-year track record over these 2025 objectives, we have delivered adjusted earnings per share at the top end of our $6 to $7 per share EPS objective. We have also continued to deliver ROIC above our 10% target. Through our strong performance, we have been able to fund the strategic investments in our businesses while returning cash to shareholders. 

"These strategic efforts and investments have positioned ADM even closer to the customer. Whether that connection is through our growing regenerator agriculture programs and partnerships, the growth of our renewable fuels partnerships as seen in our Green Bison JV with Marathon or the expansion of our Marshall, Minnesota, starch facility to serve customer needs across food and industrial products. These investments and others like them not only support our current strategy, they will be the base for us to break through the $6 to $7 per share EPS range as we move beyond 2025.”

The upbeat outlook on guidance helped lift ADM’s share price to as high as $58.46 in early trading on March 12 on the New York Stock Exchange, up 6.4% from the close of $54.91 on March 11.

Operating profit within ADM’s Ag Services and Oilseeds division fell to $4.07 billion in fiscal 2023 from $4.4 billion in fiscal 2022. Profit was down 21% in Crushing and down 15% in Ag Services, while profit in Refined Products and Other increased 56% year-over-year.

ADM said the lower year-over-year total in Ag Services reflected reduced export volume and margins in North America origination, which were only partially offset by record South American export volumes. Meanwhile, the lower Crushing results reflected improved processed volumes that were more than offset by lower crush margins and higher manufacturing costs.

Operating profit in the Carbohydrate Solutions unit was $1.38 billion in fiscal 2023, down 3% from $1.41 billion a year ago. Profit improved 24% in the Vantage Corn Processors business as strong export demand and steady domestic blending supported margins and higher ethanol production but was down 3.5% in the broader Starches and Sweeteners business, ADM said.

In Nutrition, operating profit fell 36% to $427 million from $668 million. Human Nutrition was down 25% to $417 million, while Animal Nutrition dropped 91% to $10 million from $111 million.

Along with the release of its financials, ADM said it has identified and corrected certain intersegment sales that were not recorded at amounts approximating market value as part of an ongoing investigation of its accounting practices.

The company said it made the corrections in certain intersegment sales that occurred between the Nutrition reporting segment and the Ag Services and Oilseeds and Carbohydrate Solutions reporting segments.