Linda Thrane , Cargill (952) 742-6218
Cargill reports $597 million in fiscal 1999 earnings
MINNEAPOLIS – Cargill today reported earnings of $597 million for the 1999 fiscal year that ended May 31, which included $220 million in operating earnings and a onetime gain from the sale of the company’s international seed business. Operating earnings were down 53 percent from a year ago, and revenues were down 11 percent to $46 billion.
The company had a $182 million loss in the fourth quarter, largely due to adjustments related to lawsuits filed last fall by Pioneer Hi-Bred International alleging that Cargill’s seed business had misappropriated genetic materials.
“On the operating side, our earnings and revenues continue to reflect the tough economic climate for agriculture that began in Asia two years ago and spread to other parts of the world,” said Robert Lumpkins, Cargill’s vice chairman and chief financial officer. “Commodity prices suffered their third straight year of decline due to the mismatch of weakened purchasing power in key markets and successive big global harvests – a situation aggravated by trade barriers to agricultural goods in importing countries. This has been hard on farmers and companies like Cargill.
“We realized long ago that this will be a difficult, slow road to recovery. Hard-hit countries must institute the reforms needed to help their economies heal, and much more work is necessary to lower trade barriers to agricultural and food products.”
Lumpkins said Cargill businesses as diverse as steel, salt, swine production and oilseeds processing were set back by a variety of difficult conditions. Nonetheless, the company’s meat, fertilizer and animal nutrition businesses were among several that turned in strong performances. Cargill’s financial businesses, which suffered losses last August when Russia defaulted on its debt and devalued the ruble, were restructured, and profitability improved in the second half.
Lumpkins said the company invested $1.4 billion in the business over the past year and is moving forward with a new corporate strategy under its new chief executive officer, Warren Staley, that focuses on delivering higher-value solutions to its agricultural and food customers.
Cargill is an international marketer, processor and distributor of agricultural, food, financial and industrial products and services with some 82,000 employees in 59 countries.