WESTCHESTER, ILLINOIS, U.S. — Corn Products International, Inc. reported on July 27 its 2010 second-quarter net income of $37 million, or 48¢ per diluted share (EPS) compared to a net loss of $85 million, or $1.13 EPS in the same period last year.

The second-quarter 2010 results include an $18 million charge, or 23¢ EPS, from the impairment of the company’s plant in Llay-Llay, Chile, and an after-tax charge of $3 million, or 4¢ EPS, related to the pending National Starch acquisition. The second-quarter 2009 results include after-tax impairment and restructuring charges of $110 million, with a negative EPS impact of $1.47.

Excluding National Starch acquisition costs and impairment and restructuring charges, second-quarter 2010 adjusted EPS was 75¢, a 121% improvement over the second-quarter 2009 adjusted EPS of 34¢. Diluted weighted average shares outstanding in the second quarter of 2010 were 76.6 million, up from 74.8 million in the same quarter last year.

"I am pleased to report that we had another very good quarter," said Ilene Gordon, chairman, president and chief executive officer. "We saw strong volume recovery across all our regions. In North America, we continued to see strong demand from the beverage industry in Mexico. In South America, volume growth was led by our customers in the brewing, confectionary, processed foods, and packaging industries. Volume improvement in Asia/Africa was led by customer demand for sweeteners and starches in South Korea and the confectionary and textile industries in Pakistan."

Net sales of $1 billion in the second quarter of 2010 increased 10% versus $912 million in the prior-year period. The primary contributors to growth in net sales were a positive $143 million from higher volumes and a positive $44 million from stronger foreign currencies, partially offset by a negative $96 million from lower price/mix. The price/mix decline was largely attributable to North America and reflected the normal correlation between lower corn costs and the corresponding decline in selling prices.

Second-quarter 2010 gross profit of $164 million improved 47% versus $112 million a year ago. The gross margin of 16.3% compared favorably to 12.2% last year. The improvement in gross profit was attributable to cost improvement due to higher utilization rates, lower unit corn costs, cost reduction programs, and stronger foreign currencies.

Operating expenses in the second quarter were $73 million, including $4 million of cost related to the pending acquisition of National Starch. Excluding the National Starch acquisition costs, operating expenses were $69 million, or 6.9 % of net sales, versus $61 million, or 6.7% of net sales, last year. The increase in operating expenses reflects a return to more historical run rates, the impact of stronger currencies, and higher costs.

Operating income for the second quarter of 2010 was $77 million, versus an operating loss of $73 million last year. Second quarter 2010 results include an asset impairment charge for the company's plant in Chile. The Llay-Llay plant suffered damage during a major earthquake that occurred in Chile on Feb. 27.

After receiving a completed engineering report in the second quarter, the company recorded an impairment charge of $18 million. Excluding this impairment charge and $4 million of costs related to the pending National Starch acquisition, second quarter 2010 adjusted operating income was $99 million, a 90% improvement compared to $52 million last year, excluding $125 million in impairment and restructuring charges.

Net financing costs in the second quarter of 2010 were $7 million versus $11 million last year, down $4 million on a combination of lower debt, higher cash balances and a positive $2.5 million swing in foreign exchange. The second-quarter 2010 tax rate was 44.3% versus 1.1% last year, reflecting the impact of the impairment charge in 2010, the 2009 impairment and restructuring charges and National Starch acquisition-related costs along with changes in earnings mix and discrete items.