Lisa Clemens, (952) 742-6405
Cargill Reports Third-quarter 2003 Earnings
MINNEAPOLIS – Cargill today reported $241 million in earnings from operations for the 2003 third quarter ended Feb. 28, compared with $151 million a year ago. These operating results were affected favorably by proceeds received from litigation settlements. The company also realized $3 million from nonoperating items, which brought net earnings under GAAP to $244 million in the third quarter.
For the first nine months of fiscal 2003, earnings from operations were $891 million, compared with $670 million a year ago. Similar to the third quarter, these operating results included proceeds received from litigation settlements. Cargill also realized an additional $258 million from nonoperating items, including the sale of North Star Steel’s tubular division and the adoption of new rules for goodwill accounting in the first quarter. That brought Cargill’s net earnings under GAAP to $1.15 billion for the first nine months.
“Cargill delivered solid results in often difficult circumstances during the third quarter,” said Warren Staley, chairman and chief executive officer. “In the months ahead, we must manage through the uncertainty in the global outlook. But, we also must continue building the more collaborative relationships and distinctive customer solutions that are essential to our long-term success.”
As anticipated, many of Cargill’s food, meat, oilseed processing and agricultural services business units reported more moderate operating results in the third quarter due to seasonal changes in supply and demand and the more difficult global economic environment. Some businesses strengthened in the third quarter, including cocoa, cotton and juice, deicing salt and several of the financial trading and investing units. Rising energy costs were offset for the most part by actions taken earlier to manage the company’s exposure.
The integration of Cerestar, Europe’s leading maker of specialty starches and sweeteners, continued to proceed on target. The new enterprise combines Cerestar’s research and applications centers and production facilities in Europe, the United States and China, with Cargill’s sweetener and starch businesses around the world. Cargill acquired a majority shareholding in Cerestar in April 2002, and completed the purchase in August.
In the third quarter, Cargill began to account for stock options as an expense. This elective change in accounting policy reduced Cargill’s quarterly and nine-month earnings by a small amount. For comparability, the prior year’s earnings were restated in accordance with transition rules.
Cargill, Incorporated is an international marketer, processor and distributor of agricultural, food, financial and industrial products and services with 97,000 employees in 59 countries. The company provides distinctive customer solutions in supply chain management, food applications, and health and nutrition.