Global agribusiness and food company Bunge said it has had a "disappointing end" to a "mixed and challenging year".
"2009 -- along with the first weeks of 2010 -- was also a time of significant strategic moves for Bunge. We made investments in our core businesses by starting construction on an export grain elevator in the U.S. and a soybean processing plant in Vietnam, and by acquiring Raisio's margarine businesses in Finland and Poland. These additions will enhance our ability to supply growing markets in Asia and tap into new markets in Europe, while improving our overall efficiency. And we acquired the Argentine fertilizer business of Petrobras, which expanded our product portfolio in Argentina and will strengthen our relationships with farmers,” Weisser said.
"We also expanded further in sugar & bioenergy by entering into agreements to acquire Moema. This transaction will increase our sugarcane milling capacity to approximately 20 million tons. As a result, we expect this business to make a significant contribution to our top and bottom lines in 2010. Lastly, we agreed to sell our fertilizer nutrients assets to realize the full value of this business today. This sale will also provide the financial flexibility to redeploy capital in our core businesses and in complementary value chains, where we see a number of opportunities.
"Of course, divesting our nutrients assets alters the profile of our fertilizer business. Moving forward, this business, which serves as a valuable complement to our agribusiness operations, will continue to make a meaningful, albeit smaller, contribution to our overall results. We have made changes to the retail business in Brazil with an aim to reduce risks associated with price and foreign exchange volatility. We have consolidated responsibility for raw material sourcing and end product sales, and we are working to reduce lead times on purchases and adjust our cost structure.
"2010 should be a good year for Bunge, with solid performances from our businesses. We will continue to focus on our strategy and seek to generate greater shareholder value by building on our global asset network and leveraging our commercial, logistics and risk management expertise across greater volumes and more products."
For the year ended 31 December, net income dropped 66% to US$361m, hurt by high-cost inventory and a “weak” price environment, the firm said today (4 February).
Sales amounted to $41.93bn, a 20% drop on the previous year.
Alberto Weisser, Bunge's chairman and CEO said: "Bunge's earnings in the fourth quarter represent a disappointing end to a mixed, and ultimately challenging, year for Bunge. In 2009, fertilizer generated significant losses, which stemmed from a difficult market characterized by high-cost inventory and a weak price environment.”
The firm however, remained optimistic for the remainder of the year. Bunge narrowed its loss for the fourth quarter to $28m. The year-earlier loss was $210m.
Revenue fell to $10.44bn, a 6% loss on the previous year.