Cargill 2Q earnings off 88 percent

Minneapolis—Cargill Inc. said Jan. 10 that its earnings from continuing operations were off 88 percent during the second quarter ending Nov. 30, 2011, to $100 million from the year-ago $832 million. Six-month earnings were $336 million, compared with the year-ago $1.53 billion. Both the year-ago figures exclude earnings from Cargill’s former majority investment in The Mosaic Co. Consolidated revenues in the second quarter were $33.3 billion, up 17 percent from $28.5 billion a year ago. First-half revenues totaled $67.9 billion, compared with $54.2 billion in the prior period. “The second quarter was significantly below expectations, especially in contrast to last year when we posted our strongest quarter ever,” said Greg Page, Cargill chairman and CEO. “Our food ingredients and agriculture services businesses generated solid earnings. At the same time, our commodity-based trading and asset management businesses faced significant challenges. First, commodity and financial markets were driven more by political uncertainties than by underlying supply and demand fundamentals. Second, our performance in the sugar market was poor. Additionally, our meat businesses on a combined basis experienced one of their weakest quarters. Finally, we recognized a significant number of one-time items, including asset impairments, and acquisition and integration expenses.” Page said Cargill is actively working to reduce its costs and simplify its work processes, and he is optimistic about the company’s earnings prospects for the remainder of the fiscal year. “Cargill has been through difficult cycles before, made changes, and emerged stronger for it. We are confident that the actions we are taking to create a more agile enterprise will better position us in the current economic environment.” In December, Cargill announced it would reduce its workforce by up to 2,000 of its 138,000 employees globally, a change of about 1.5 percent. The majority of the reduction will take place worldwide over the next six months.