CHICAGO (Reuters) - U.S. agricultural processor Archer Daniels Midland (ADM.N) posted stronger-than-expected quarterly earnings on Tuesday as improving demand and stronger margins in oilseeds and corn processing bolstered results.
Fiscal fourth-quarter profit was up more than sevenfold from last year's recession-crimped final quarter, as each of the company's business segments posted higher operating profits.
"The ADM team finished strong, capping a very good year with very good fourth-quarter performance," said Patricia Woertz, ADM's chief executive officer.
The company's bioproducts division, which includes ADM's seven ethanol plants, and its agricultural services segment reversed year-ago losses as demand for food and fuel continued to rebound from a difficult 2009.
Decatur, Illinois-based ADM is one of the largest U.S. processors of grain and soybeans and a top ethanol producer.
For the fiscal fourth quarter ended June 30, net profit was $446 million, or 69 cents per share, compared with $58 million, or 9 cents a share, in the same quarter a year ago.
Analysts on average expected 53 cents per share, according to Thomson Reuters I/B/E/S.
Revenue slipped to $15.7 billion from $16.5 billion a year ago, but processing volumes were up and the cost of products sold fell 8.6 percent from a year earlier.
ADM said oilseeds processing profit rose to $359 million, up $132 million from a year ago, on improved oilseed crush margins and higher processing volumes. But it noted some near-term pressure on margins amid a excess global processing capacity.
"We see growing long-term demand for protein meal but short-term excess processing capacity is resulting in softer crush margins," said Steven Mills, ADM's chief financial officer.
Improving diets in fast developing nations such as China have bolstered demand for protein meals used as livestock and poultry feeds.
The solid oilseed processing results were in stark contrast to rival agribusiness Bunge Ltd (BG.N), which reported a surprising quarterly loss last week and cut full-year guidance, citing unfavorable oilseed processing margins.
ADM's corn processing segment posted net earnings of $140 million as stronger bioproducts margins more than offset lower operating profit in sweeteners and starches.
A year ago, the segment lost $11 million as low ethanol prices and high corn costs squeezed margins.
Agricultural services operating profit was $178 million, compared with a net loss of $17 million a year earlier, on rising global supplies of grains and oilseeds and amid improving demand, most notably from Asia.
ADM's other business units, including cocoa and flour milling, posted a profit of $122 million, up from $9 million a year ago.
Shares of ADM on the New York Stock Exchange were up 35 cents, or 1.2 percent, to a 3-1/2 month high of $28.67.
Reporting by Karl Plume; editing by Maureen Bavdek and John Wallace