Net revenues, meanwhile, slipped 4.5% to $15.832 billion from $16.565 billion a year ago.
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| Juan Luciano, chairman and chief executive officer of ADM. |
“After working through the challenging environment in the first half of the year, we capitalized on improving operating conditions in the third quarter and are positioned well for a solid finish to the year,” said Juan Luciano, chairman and chief executive officer of ADM.
Operating profit in the Agricultural Services segment increased nearly 30% to $193 million, up from $149 million a year ago. Sharp gains in merchandising and handling and transportation helped offset a decline in milling. Revenues in the segment increased 5% to $6.960 billion.
“Ag Services results were driven by U.S. exports that surged through the quarter, creating improved merchandising opportunities as the global market relied heavily on U.S. exports of corn and soybeans,” Luciano said.
In the Corn Processing segment, operating profit climbed 62% to $212 million from $131 million behind strong gains in sweeteners and starches. Revenues fell to $2.391 billion from $2.519 billion.
“Results for Corn included strong performance in North American sweeteners and starches, growth from our international corn operations and steady results for bioproducts,” Luciano noted.
Operating profit in the Oilseeds Processing unit fell 57% to $144 million from $335 million, as the company suffered a sharp decline in its crushing and origination results. Revenues for the segment also were lower, falling to $5.775 billion from $6.747 billion.
“Oilseeds results were impacted by significantly lower global soy crushing margins, weaker origination results in Brazil and the unusual equity loss from our Wilmar investment,” Luciano said.
Operating profit for Wild Flavors and Specialty Ingredients (WFSI) rose 4% to $73 million from $70 million a year ago. Revenues increased to $611 million from $588 million.
“WFSI results included strong growth from Wild Flavors with mixed results from our specialty ingredients businesses,” Luciano said.
Overall, Luciano said ADM continued to execute its strategic plan in the third quarter.
“We acquired Caterina Foods, a manufacturer of specialty gluten-free and high-protein pastas,” he said. “In addition, we further invested in Asia’s growing and evolving food demand by increasing our strategic ownership stake in Wilmar to 23%. Our ethanol dry mill review has progressed and we are targeting receipt of final proposals from a short list of interested parties by the end of the calendar year. And, we have implemented nearly $250 million of new run-rate savings actions through the third quarter and expect to exceed our $275 million target by the end of the calendar year. In line with our balanced capital allocation framework, we have returned $1.3 billion to shareholders in dividends and share buybacks through the first nine months of the year.
“With improving market conditions and a large U.S. harvest, combined with the team’s solid execution capabilities, we feel good about the remainder of the year and a stronger 2017.”
For the nine months ended Sept. 30, net income at ADM totaled $855 million, or $1.44 per share, down 24% from $1.131 billion, or $1.80 per share, in the same period a year ago. Net revenues for the nine months were $45.845 billion, down 11% from $51.257 billion.
