ADM Reports 24% Decrease in Adjusted Operating Profit

ADM (NYSE: ADM) has released its first quarter 2024 financial results, indicating reported earnings per share (EPS) of $1.42 and adjusted EPS of $1.46. The company's segment operating profit was $1,311 million, with adjusted segment operating profit at $1,317 million. These figures represent a 24% decrease in adjusted operating profit compared to the first quarter of 2023.

The breakdown of segment operating profit for the first quarter of 2024 compared to the same period in 2023 is as follows: Ag Services & Oilseeds: $864 million (down 29%) Carbohydrate Solutions: $248 million (down 11%) Nutrition: $84 million (down 39%) Other: $121 million (up 25%)

Under the Ag Services & Oilseeds segment, ADM's ag services subsegment operating profit decreased by 33%, while crushing and refined products and other subsegments saw declines of 27% and 48%, respectively. However, equity earnings from Wilmar increased by approximately 37% compared to the prior year.

In the Carbohydrate Solutions segment, the starches and sweeteners subsegment reported a 17% decrease in operating profit, while the vantage corn processors subsegment improved by 62%.

The Nutrition segment's human nutrition subsegment operating profit was notably lower by 45%, while the animal nutrition subsegment saw an increase in operating profit.

The Other segment operating profit increased by 25%, supported by higher captive insurance results and improved ADM investor services.

Looking ahead, ADM has affirmed its adjusted earnings per share guidance for the full year, expecting it to be in the range of $5.25 to $6.25.

ADM's Chair of the Board and CEO, Juan Luciano, emphasized the company's ability to execute its strategy amidst challenging market conditions, highlighting the ramp-up of production at the Green Bison JV and scaling efforts in regenerative agriculture and biosolutions. Additionally, Luciano noted the expansion of the productivity initiative pipeline and the ongoing reduction of supply chain complexity to better serve customers in the nutrition segment.

The company remains confident in its full-year guidance, despite the observed changes in various operating metrics compared to the prior year period. As a result of these announcements, the company's shares have moved -3.0% on the market, and are now trading at a price of $58.85. For the full picture, make sure to review Archer-Daniels-Midland's 8-K report.

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