Monsanto slashing 2,600 jobs, buying back shares as sales fall
By Carey Gillam
(Reuters) - Monsanto Co, one of the world's largest seed and agrichemical companies, said on Wednesday that it was slashing 2,600 jobs and restructuring operations to cut costs in a slumping commodity market.
The company, which said it expected low prices for agricultural products to squeeze results well into 2016, also reported a much wider quarterly loss and gave an outlook below many analysts' expectations.
The layoffs would affect 11.6 percent of Monsanto's regular workforce, according to the company.
The global restructuring will also include an exit from the sugar cane business and "streamlining and reprioritizing" some commercial and research and development work.
To try to shore up investor confidence, the company announced a $3 billion accelerated share repurchase program that Chairman Hugh Grant said would be completed in the next six months. Its shares, which fell as much as 4.3 percent early on Wednesday, were nearly unchanged in afternoon trading.
Monsanto said it expected to incur restructuring costs of $850 million to $900 million. When completed, the moves should help save as much as $400 million a year.
The restructuring, which caps a year when Monsanto's sales fell more than 5 percent, comes during an agricultural slump and a currency collapse in the important Brazilian market.
Swiss rival Syngenta AG, which Monsanto had tried to acquire over the summer, has said it is trying to bolster its bottom line by selling a vegetable seed business and undertaking a $2 billion share repurchase. And DuPont, which operates agricultural seed seller DuPont Pioneer, has lowered its profit outlook. Continued...