Oct. 7 (Bloomberg) -- Monsanto Co., the world’s largest seed producer, reported fourth-quarter profit that exceeded analysts’ estimates because of higher corn and vegetable seed sales. The company maintained its forecast for 2010 earnings.
Profit in the three months ended Aug. 31 was 2 cents a share, excluding some items, St. Louis-based Monsanto said today in a statement. The average estimate of 13 analysts in a Bloomberg survey was for profit of 1 cent. The net loss widened to $233 million, or 43 cents a share, from $172 million, or 31 cents, a year earlier, largely because of restructuring costs.
Chief Executive Officer Hugh Grant is cutting 8 percent of the workforce as farmers spend less and Chinese competitors sell cheaper generic versions of the company’s Roundup herbicide. Monsanto repeated its 2010 earnings forecast after two earlier cuts in the outlook for the glyphosate-based weed killer.
“People thought they would lower the outlook,” Laurence Alexander, a New York-based analyst at Jefferies & Co., said by telephone. “The outlook for next year is basically in line.”
Earnings in the year that began Sept. 1, excluding some items, will be $3.10 to $3.30, Monsanto said, repeating a Sept. 10 forecast. Profit was projected to be $3.42 a share, the average estimate of 15 analysts surveyed.
First-Quarter Forecast
First-quarter profit will be break even or a “modest” loss because of lower Roundup sales, Chief Financial Officer Carl Casale said on a conference call with analysts. Monsanto was projected to post profit of 40 cents a share in the current quarter, the average estimate of four analysts.
About 60 percent of 2010 earnings will accrue in the second quarter and 40 percent in the third quarter, with a small loss in the final three months, Casale said.
Monsanto fell 99 cents, or 1.3 percent, to $74.38 at 11:52 a.m. in New York Stock Exchange composite trading. The shares gained 7.5 percent this year through yesterday.
Fourth-quarter revenue fell 8.4 percent to $1.88 billion because of lower herbicide sales, trailing the $1.99 billion average estimate of six analysts in the survey.
The fourth-quarter net loss includes 53 cents a share of restructuring expenses and a gain of 8 cents from the sale of the sunflower unit.
Results in Monsanto’s fourth quarter often are weaker than in other periods because farmers in North America and Europe have planted most of their crops.
Gross Profit
Fourth-quarter gross profit declined 11 percent to $857 million as profit from seeds and traits dropped 17 percent and crop chemicals fell 3.5 percent, led by a 23 percent drop in glyphosate herbicides. Corn and vegetable seed sales gained, while cotton, soybeans and other crop seeds declined.
In 2010, gross profit from seeds and traits will rise to $5.1 billion to $5.2 billion, Monsanto said, repeating the September outlook. That’s an increase of as much as 16 percent from $4.5 billion in 2009.
Gross profit in the weed-killer unit will drop to $650 million to $750 million, Monsanto said in a presentation on its Web site, repeating last month’s forecast. That’s as much as a 64 percent decline from $1.8 billion in 2009. Monsanto initially forecast gross profit of $1.9 billion before reducing its expectations in June and September.
The company is cutting Roundup prices in half to as little as $10 a gallon in the hopes of reclaiming lost market share, Grant said in a Sept. 23 interview.
Herbicide gross profit will be as much as $900 million in 2011 before stabilizing at about $1 billion in 2012, Monsanto said in the presentation. Grant in June said he may divest the Roundup business after restructuring and carving it out as a separate unit.
Market Share
Grant said he was “disappointed” with Monsanto’s 36 percent share of the U.S. corn seed sales, unchanged from 2008, after targeting a gain of as much as 2 percentage points. Few companies gained share while Monsanto increased average corn- seed prices 25 percent to capture some of the value provided by crops that resist bugs and herbicides, he said.
“We all ended up about flat,” Grant said. “In a world of flatness, I feel really good because we priced to the value we deliver.”
The Holden’s unit, Monsanto’s licensing arm, lost corn-seed share to ProAccess, a unit of DuPont Co., Scarlett Foster, a spokeswoman, said on the call.
The company’s share of U.S. soybean seed sales fell half a percentage point to 28.5 percent, and cotton-seed sales dropped 2 points to 39 percent of the U.S. market.
DuPont Share
DuPont’s Pioneer unit, the second-biggest seed producer, said Sept. 16 that it grabbed 2 more percentage points of corn- seed share, reversing years of losses to Monsanto, and gained 3 points of U.S. soybean share.
Smartstax corn seed, developed with Dow Chemical Co. to contain eight genetic modifications, will “reinvigorate” share gains when the product is introduced for planting next year, Casale said.
The seeds, which boost yields 5 percent to 10 percent compared with other products, will be planted on as many as 4 million acres in 2010, with a U.S. potential for 65 million acres, Monsanto has said.
To contact the reporter on this story: Jack Kaskey in New York at jkaskey@bloomberg.net.
Last Updated: October 7, 2009 11:53 EDT
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miércoles, 14 de octubre de 2009
martes, 28 de julio de 2009
India avanza en biotecnologías para climas extremos
India Developing Seeds That Can Withstand Extreme Weather
6:03 AM, julio 27, 2009
NEW DELHI (Dow Jones)--India is developing gene varieties for rice and other
seeds that can withstand extreme weather fluctuations such a droughts or floods
lasting as long as two weeks, according to a senior scientist at the state-run
Indian Council for Agricultural Research.
This can potentially reduce the country's dependence on annual monsoon rains
which are the only source of water for nearly 60% of India's farmlands and its
vulnerability in times of excessive rains.
Such high dependence on natural irrigation and the inability to limit
flooding in years of plentiful rains have led to wide fluctuations in India's
crop output and gross domestic product because two-thirds of the country's 1.1
billion people are still dependent on agriculture for livelihood.
"We are trying to develop multi-tolerance crops by combining genes," ICAR
Deputy Director General Anil Kumar Singh said in a recent interview. The gene
varieties, which have been developed so far, are very specific to either
drought or floods and not both.
But the challenge is developing crops with resistance while ensuring the
yield doesn't drop in the process, because "extreme variations in weather are
happening with increasing frequency these days," Singh said. "We already have
drought-resistant varieties of seeds but the yields are low. We don't want to
compromise on yields while developing the genes that can withstand multiple
stresses."
He said multi-tolerance genes are being developed for wheat, rice and most
other crops. The research is being done by the National Institute of Abiotic
Stress Management, set up in January 2009. This year, monsoon rains have been
18% below normal until July 23 while excess rains in some parts have caused
floods that have damaged the rice crop.
In the northern state of Assam and Orissa in east, rice sowing has been hit
by floods. However, in some of parts of Assam, neighboring Manipur, Nagaland,
parts of Uttar Pradesh, and Jharkhand in central India, the state governments
have said the situation is drought-like due to deficient rains.
India's area under summer-sown rice is down by about 21% to 11.5 million
hectares till July 17, government data showed. In a normal year, the country
has about 45 million hectares under rice cultivation.
While working on seeds with higher resistance various weather changes, ICAR
is also seeking to improve general productivity in the farming sector, Singh
said.
India's crop productivity, which the federal government has said was
stagnating, could be improved substantially through more usage of fertilizers
and expanded irrigation facilities, he said.
"Punjab and Haryana have one of the highest yields in the country because of
better inputs. We can increase yields elsewhere in the country by atleast 50%
with the seeds and technology we have now," he said.
Crop yields in rain-fed areas is about one ton per hectare, Singh said. It is
about 2.5 tons in irrigated areas.
Average rice productivity is about 2.2 tons/hectare in India which is way
lower than that in China, the largest producer of the grain.
"China's fertilizer usage is almost two-and-a-half times more than India's
and they are into hybrid rice cultivation, which has a higher yield," Singh
said adding India has started cultivation of hybrid rice only a few years ago.
-By Arpan Mukherjee, Dow Jones Newswires; 91 11 4356 3310;
arpan.mukherjee@dowjones.com
6:03 AM, julio 27, 2009
NEW DELHI (Dow Jones)--India is developing gene varieties for rice and other
seeds that can withstand extreme weather fluctuations such a droughts or floods
lasting as long as two weeks, according to a senior scientist at the state-run
Indian Council for Agricultural Research.
This can potentially reduce the country's dependence on annual monsoon rains
which are the only source of water for nearly 60% of India's farmlands and its
vulnerability in times of excessive rains.
Such high dependence on natural irrigation and the inability to limit
flooding in years of plentiful rains have led to wide fluctuations in India's
crop output and gross domestic product because two-thirds of the country's 1.1
billion people are still dependent on agriculture for livelihood.
"We are trying to develop multi-tolerance crops by combining genes," ICAR
Deputy Director General Anil Kumar Singh said in a recent interview. The gene
varieties, which have been developed so far, are very specific to either
drought or floods and not both.
But the challenge is developing crops with resistance while ensuring the
yield doesn't drop in the process, because "extreme variations in weather are
happening with increasing frequency these days," Singh said. "We already have
drought-resistant varieties of seeds but the yields are low. We don't want to
compromise on yields while developing the genes that can withstand multiple
stresses."
He said multi-tolerance genes are being developed for wheat, rice and most
other crops. The research is being done by the National Institute of Abiotic
Stress Management, set up in January 2009. This year, monsoon rains have been
18% below normal until July 23 while excess rains in some parts have caused
floods that have damaged the rice crop.
In the northern state of Assam and Orissa in east, rice sowing has been hit
by floods. However, in some of parts of Assam, neighboring Manipur, Nagaland,
parts of Uttar Pradesh, and Jharkhand in central India, the state governments
have said the situation is drought-like due to deficient rains.
India's area under summer-sown rice is down by about 21% to 11.5 million
hectares till July 17, government data showed. In a normal year, the country
has about 45 million hectares under rice cultivation.
While working on seeds with higher resistance various weather changes, ICAR
is also seeking to improve general productivity in the farming sector, Singh
said.
India's crop productivity, which the federal government has said was
stagnating, could be improved substantially through more usage of fertilizers
and expanded irrigation facilities, he said.
"Punjab and Haryana have one of the highest yields in the country because of
better inputs. We can increase yields elsewhere in the country by atleast 50%
with the seeds and technology we have now," he said.
Crop yields in rain-fed areas is about one ton per hectare, Singh said. It is
about 2.5 tons in irrigated areas.
Average rice productivity is about 2.2 tons/hectare in India which is way
lower than that in China, the largest producer of the grain.
"China's fertilizer usage is almost two-and-a-half times more than India's
and they are into hybrid rice cultivation, which has a higher yield," Singh
said adding India has started cultivation of hybrid rice only a few years ago.
-By Arpan Mukherjee, Dow Jones Newswires; 91 11 4356 3310;
arpan.mukherjee@dowjones.com
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