This fiscal year’s effective tax rate of 30 percent was in line with the same six-month period last year.
Oilseeds Earnings Improve Across All Three Regions
Oilseeds operating profit in the second quarter was $411 million, up $202 million from the same period one year earlier. Results included unfavorable mark-to-market timing effects of about $50 million (about $0.05 per share), compared to an unfavorable impact of about $110 million in the year-ago quarter.
Crushing and origination operating profit was $261 million, up $140 million from the year-ago quarter on strong improvements in all three geographies. ADM’s U.S. soybean operations ran at record capacity during the quarter and delivered very strong results amid good domestic and export meal demand. In South America, ADM was well prepared to move the record corn harvest. And in Europe, operational changes and reduced imports from South America drove improved results.
Refining, packaging, biodiesel and other generated a profit of $50 million for the quarter, down $27 million, due to weakness in biodiesel margins in the U.S. and Europe.
Cocoa and other results increased $66 million. Weaker cocoa press margins were offset by the absence of last year’s significant negative mark-to-market impacts.
Oilseeds results in Asia for the quarter were up $23 million from the prior year’s second quarter, principally reflecting ADM’s share of the results from its equity investee Wilmar International Limited.
Corn Processing Results Weak on Continued Ethanol Industry Challenges
Corn processing operating profit of $3 million represented a decline of $207 million from the same period one year earlier, when excluding the year-ago quarter’s $339 million asset impairment.
Sweeteners and starches operating profit increased $22 million to $97 million, as tight sweetener industry capacity and higher corn costs supported higher year-over-year selling prices.
Excluding last year’s $339 million asset impairment charge, bioproducts results decreased $229 million to a loss of $94 million. Weak domestic gasoline demand and unfavorable global ethanol trade flows resulted in continued excess industry capacity, keeping ethanol margins negative.