July 29, 2020 / 10:44 AM / 11 days ago

UPDATE 3-Bunge raises outlook as robust agribusiness powers profit beat

(Adds details, adds shares rising, adds upcoming earnings for rival ADM)

By Karl Plume and Shradha Singh

July 29 (Reuters) - Agricultural commodities trader Bunge Ltd on Wednesday raised its full-year outlook after its second-quarter profit handily beat Wall Street estimates, bolstered by oilseed crushing and robust crop exports to China.

Despite a worsening coronavirus pandemic that has rattled global markets, Bunge reported strong soy processing margins in South America, Europe and Asia, record capacity utilization at its plants and the lowest crushing costs in three years.

Meanwhile, accelerated crop sales by U.S. and Brazilian farmers provided ample exportable supplies. Top importer China logged record Brazilian soy imports during the quarter.

Shares were up about 1.5% early on Wednesday.

“These results would be strong in any environment, let alone a pandemic,” Chief Executive Greg Heckman said in a statement.

Bunge’s strong second quarter, following a surprise loss in the first, highlighted the disruption the agribusiness industry has faced during the pandemic.

Shuttered restaurants and food service companies, both major customers for Bunge’s cooking oils, shifted demand to more at-home dining, while travel restrictions hammered biofuel margins.

Rival agribusiness Archer Daniels Midland Co will release second-quarter results later on Wednesday.

Bunge said its facilities worldwide continue to operate at or near-normal levels despite the pandemic, although it confirmed on Tuesday that one positive COVID-19 case suspended operations at an Argentine port facility.

Operating earnings in Bunge’s agribusiness segment grew four-fold in the quarter, triggering the improved 2020 outlook. Edible oils, milling and fertilizer units also posted gains, while sugar and bioenergy posted a loss.

The oils segment, however, may struggle from uncertain demand due to the pandemic, Bunge said.

Net income available to shareholders was $521 million, or $3.47 per share, in the three months ended June 30, compared with $214 million, or $1.43 per share, a year earlier.

Excluding items, Bunge earned $3.88 per share, above analysts’ average estimate of $1.32, according to IBES data from Refinitiv.

Reporting by Karl Plume in Chicago and Shradha Singh in Bengaluru; Editing by Ramakrishnan M and Marguerita Choy

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