Cargill earnings surge in first quarter

19-10-2007 | |

Earnings in the first fiscal quarter of Minneapolis-based Cargill Inc. have surged 83%, referring to successes in the company’s origination and processing segment, which produces agricultural commodities.

For the quarter ended Aug. 31, net earnings were $917 million, compared with
$500 million in the year-earlier period.

“June through August was an
extraordinary period, with growing demand for agricultural commodities against
tightening suppliers and a long anticipated but dramatic reduction in liquidity
and leverage in financial markets,” chairman and CEO Greg Page said in a news
release.

Being a privately held company Cargill does not break out sales
or earnings by segment. The company did, however, report that results were led
by Cargill’s origination and processing segment, which sources, processes,
markets and distributes agricultural commodities and provides supply chain and
risk management services to customers globally.

Two segments — food
ingredients and applications, and industrial — also outperformed last year’s
first-quarter earnings. The agriculture services segment, which serves crop and
livestock producers, edged ahead of last year’s results.

The risk
management and financial segment was moderately below the year-ago level, which
reflected smaller contributions from some energy and financial
activities.

Cargill began the process of purchasing the remaining shares
of Agrograin, a Hungarian grain company in which it bought a minority interest
and formed a joint venture in 1995. The acquisition supports the further
development of Cargill’s grain and oilseeds origination capacity in central and
east Europe.

Cargill announced plans to double the capacity of its canola
processing plant in Clavet, Saskatchewan. The project is a part of Cargill’s
ongoing investments in new and expanded facilities that support the company’s
supply chain solutions for customers.

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