* Q1 EPS 54 cents, vs Wall Street view 75 cents
* Net profit $345 mln, down 30 pct from year earlier
* Revenue of $16.8 bln tops analyst view $15.66 bln
* Shares fall 6.8 pct
(Adds details, quotes, updates share price, adds byline)
By Karl Plume
CHICAGO, Nov 2 U.S. agricultural processor
Archer Daniels Midland Co (ADM.N) reported weaker-than-expected
quarterly earnings on Tuesday, hampered by inventory charges
and lower profit in its agricultural services business, sending
shares down nearly 7 percent.
ADM, the world's largest corn processor and among the
largest U.S. ethanol producers, said net profit fell 30 percent
despite strong corn and oilseed processing results and
Operating profit fell 25 percent in ADM's agricultural
services segment, the company's largest in terms of sales, due
to "negative impacts from supply shifts" and "government
actions" in the drought-hit Black Sea region, ADM said.
A severe drought slashed crop production in the region this
year, prompting export curbs by Ukraine and a grain export ban
by Russia expected to last through next July.
"People were looking for a much different outcome. Usually
this is a company that can take advantage of geographic
disparities and it looks like they got caught on the wrong
side," said Ian Horowitz, analyst with Rafferty Capital
"Even if you adjust back the LIFO (last-in, first-out
inventory accounting), the non-cash and the one-time charges,
it wasn't really that strong of a quarter," he said.
Net income in the first quarter ended Sept. 30 fell to $345
million, or 54 cents per share, down from $496 million, or 77
cents per share, a year earlier.
Analysts on average were expecting earnings of 75 cents per
share, according to Thomson Reuters I/B/E/S.
However, revenue rose to $16.8 billion from $14.9 billion,
beating the analysts' average forecast of $15.66 billion.
ADM said rising commodity prices resulted in a LIFO charge
of $123 million, or about 12 cents a share, compared with a $76
million credit in the same quarter a year earlier.
Stronger oilseed crush margins and increased volumes lifted
ADM's oilseeds processing profit 8 percent to $308 million.
Corn processing profit jumped to $341 million from $188
million as bioproducts, which swung to a profit on improved
ethanol and lysine margins and stronger ethanol sales, offset
lower results in sweeteners and starches.
Shares of ADM were down about 6.8 percent at $31.11 on the
New York Stock Exchange, the biggest single-day drop since May.
Shares hit a 28-month high last week.
(Reporting by Karl Plume, editing by Gerald E. McCormick)