Cargill has reported an increase in its second quarter net earnings of 41%, year on year. With significant growth in earnings for grain processing and animal nutrition.
According to the company’s financial report the origination and processing segment was the largest contributor to the company’s second-quarter results, with earnings up considerably from the year-earlier period.
Record corn and soybean harvests in the US, combined with strong domestic and export demand, boosted soybean origination, crush volumes, and bean and meal exports. Grain origination and exports via the US Gulf of Mexico also were robust.
Canadian performance stayed strong, bolstered by the country’s 2014 harvest, the carryover from 2013’s record crops and a steady export pull. Recent years’ capital investments in grain-handling capacity and efficiency, and an expanded portfolio of agronomic, grain marketing and risk management solutions for farmer customers also enhanced Cargill’s North American-based earnings. Results in South America were curbed by the challenging macroeconomic environment, including the effects of delayed farmer selling on supply chains in Argentina and Brazil.
Animal nutrition earnings
Animal nutrition and protein earnings rose significantly from the year-ago period. Within the segment, animal nutrition results increased moderately, with lower raw material costs and applied expertise in micronutrients and other specialty ingredients contributing to the uptick. A broad-based performance put the segment’s animal protein businesses well ahead of last year. Results were led by Australian beef processing, and US cattle feeding and pork processing. The US turkey business enjoyed one of its best holiday seasons. Actions taken to refresh its retail brands, including branded offerings of fresh bone-in turkey breasts and fresh whole turkeys raised without growth-promoting antibiotics, were rewarded by strong retail demand.
All in all the company’s Q2-2015 net earnings were $784 million (ended Nov. 30) up from $556 million in the previous year. First-half earnings were $1.21 billion, a 7% increase from $1.13 billion a year ago. Second-quarter revenues decreased 8% to $30.3 billion, which brought first-half revenues to $63.6 billion.