WHITE PLAINS, NEW YORK, U.S. — Record earnings in Bunge’s Agribusiness segment contributed to total segment earnings of $1.229 billion or $4.83 per share for the year ended Dec. 31, 2015, an increase of 1.9% from 2014, the company reported on Feb. 11.

Annual earnings for its Agribusiness segment were $1.05 billion, up 17.7% from $895 million in the same period of last year.

“In 2015, the Bunge team achieved numerous milestones: record Agribusiness EBIT, four-quarter trailing ROIC in our core Agribusiness and Food operations of 10% and approximately $100 million of savings from performance improvement initiatives,” said Soren Schroder, Bunge’s chief executive officer. “We also executed on our balanced approach to capital allocation, buying back $300 million of common shares, which has continued into 2016 with an additional $100 million of buybacks.”

For the fourth quarter, Bunge reported adjusted total segment earnings of $337 million, down from $397 million in the same period a year earlier. For the Agribusiness segment, earnings were $268 million, down from $319 million in the same quarter a year earlier.

“In the fourth quarter, Bunge managed the challenging market conditions well, leveraging our balanced global footprint to capitalize on good soy processing margins and increased South American grain exports,” Schroder said. “Food & Ingredients showed slight improvement from the third quarter; however, our Brazilian food businesses continued to struggle in the depressed market environment. Our sugarcane milling operation had its strongest quarter of the year, finishing 2015 with positive EBIT and free cash flow.

Fourth-quarter results in Oilseeds were solid, but lower than last year. Soybean processing was higher in Brazil, Argentina, Europe and Asia, driven by higher volumes and margins. Results in the U.S., however, were lower than last year’s record year as margins softened in anticipation of Argentine supply.

Lower results in Grains were primarily due to reduced volumes and margins in Bunge’s U.S. operation, which was impacted by slow farmer selling and increased global export competition. Partially offsetting this reduction were higher results in ports & services operations, which benefited from increased grain exports out of South America and the Black Sea, Bunge said.

Lower segment volume was primarily due to decreased grain origination in the
U.S. and export flows in Bunge’s trading & distribution businesses. Volumes in soybean processing, however, were up in all regions.
Fourth-quarter 2015 results included $23 million of charges related to export taxes and fees in Argentina and an impairment of an equity investment in a freight shipping company in Europe.

Edible Oil Products segment performance improved from the third quarter, with higher seasonal volumes and the increasing impact of Bunge’s improvement programs. Results did, however, lag last year, with currency weakness and dampened consumer confidence in key regions. In Brazil, core markets, such as margarines and shortenings, have experienced approximately 6% declines in 2015 as consumers bought less and traded down.

The North American Oils business performed well, Bunge said, benefitting from a combination of a more competitive and higher value product mix and increased demand from the key foodservice channel.

Despite lower Milling Products segment results, Bunge said it made significant progress integrating acquisitions in Mexico, U.S. and Brazil, as well as advancing the rebuild of its mill in Rio de Janeiro. Decreased results in the quarter were primarily due to the Brazilian wheat milling business, which continued to be impacted by declining consumer confidence and tightening spend. Volumes and margins were lower from a reduction in consumer demand, particularly in
the higher margin food service channel, where industry wheat product volumes are down 19% in 2015.

Corn milling results in North America improved from last year, due to lower costs, more optimized product mix and the contribution from extruded product and masa acquisitions. In Mexico, higher volumes and increased productivity were more than offset by the combination of lower margins and impacts of the weaker peso. For 2015, Mexico wheat milling results where higher year-over-year and in line with our expectations.

Looking ahead to 2016, Schroder said there are positive signs including growing global demand for core Agribusiness products and large soy and corn crops in Brazil.

“But challenges are also evident. Conditions will remain difficult for our Brazilian Food & Ingredients businesses. Northern Hemisphere oilseed processing margins and grain exports will be pressured until markets adjust to the increased level of global supplies,” Schroder said. “We expect a challenging year, but ultimately a year of modest earnings growth and ROIC well above WACC in our core Agribusiness and Foods operations.”