Cargill Reports Strong Gains in 2QCargill Reports Strong Gains in 2Q
January 12, 2011
MINNEAPOLIS Cargill released its net earnings for the fiscal 2011 second quarter ended Nov. 30. The company reported net earnings of $1.49 billion, compared to $489 million in the same period a year ago. Excluding earnings from its majority investment in The Mosaic Company, Cargill earned $832 million, nearly double last year's $420 million.
In the first six months, Cargill earned $2.37 billion, up from $1.01 billion a year ago. Excluding Mosaic, Cargill's first-half earnings were $1.53 billion, a 74 percent increase from $878 million a year ago.
"Cargill generated strong results across the breadth of our businesses," said Greg Page, Cargill chairman and chief executive officer. "The diversity and balance built into the mix provides the company with a great deal of resilience. By tapping the connectivity among our businesses, we also put more knowledge and insight to work on behalf of customers. Increasingly, they look to Cargill for innovation that supports their growth objectives."
Four of Cargill's five business segments posted increased earnings in the second quarter. Results were led by the origination and processing segment, which developed an early and accurate read on the first quarter's weather events and subsequent shifts in trade flows and supply-and-demand dynamics. This enabled the segment to serve import-dependent customers with grain rerouted from alternate origins while handling substantial volatility across agricultural commodity markets.
Second-quarter earnings also rose in agricultural services, aided by the bigger grain handling volumes made possible by the large North American harvest.
Results in food ingredients were mixed, with some units benefitting from better volumes and gains from risk management activities and others pressured by higher raw material costs. On a combined basis, segment earnings increased moderately from the second quarter a year ago.
During the second quarter, Cargill agreed to acquire Unilever's shelf-stable condiments business in Brazil. The purchase includes leading brands in tomato sauce and paste, and a processing facility in the state of Goiás. The acquisition, which is expected to be completed in the first quarter of calendar 2011, would add to Cargill's stable of well-known brands of cooking oils, mayonnaise, olive oils, olives and pasta sold today in Brazilian supermarkets.
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