Monsanto Ups Forecast

The company now sees 10% to 18% growth in 2005.
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Monsanto

(MON)

said Wednesday that it is raising its growth projections for the 2005 and 2006 fiscal years.

The suburban St. Louis-based maker of agricultural products -- including herbicides and genetically altered seeds -- said it expects a 2005 fiscal year growth rate of 10% to 18% and a 10% growth rate for fiscal 2006. The company's fiscal years start on Sept. 1.

Previously, Monsanto said it had expected a 10% compounded annual growth rate for the two fiscal years. "At the beginning of the

2004 fiscal year, we set aggressive but achievable targets to advance our business," said Hugh Grant, the company's chairman, president and CEO. "We've not only delivered on those targets, but we've raised them and beat them. The success that we've had this year...sets a foundation that allows us to be more aggressive in our growth rate expectations, and to set those expectations from a higher starting point."

Monsanto said it expected to achieve EPS of $1.77 to $1.90 for the 2005 fiscal year on a reported basis. Analysts polled by Thomson First Call had been predicting EPS of $1.92.

Monsanto made that calculation based on a fiscal 2004 EPS of $1.61. The company had been predicting an EPS range of $1.55 to $1.60, which excluded a host of charges for reducing employment, closing facilities and discontinuing certain businesses. Analysts polled by Thomson First Call had been looking for an EPS of $1.64.

When all charges are included, Monsanto earned $267 million, or 99 cents a share, on revenue of $5.46 billion for the fiscal year ended Aug. 31. That compares to earnings of $68 million, or 26 cents a share, on revenue of $4.9 billion for the previous 12 months when all charges are included.

Last month, Monsanto raised its 2004 fiscal-year EPS estimate, including restructuring charges, to a range of 91 cents to 96 cents a share, from 79 cents to 84 cents a share.

For the fourth quarter of the 2004 fiscal year, Monsanto lost $42 million, or 16 cents a share, on sales of $1.26 billion, when all charges are included. The June-August period is traditionally the company's weakest. For the same period last year, Monsanto lost $188 million, or 72 cents a share, on revenue of $1.30 billion, when all charges are included.

Monsanto said fourth-quarter sales were slightly lower than the comparable period last year due to lower revenue from its Roundup herbicide in the U.S. But full fiscal-year revenue improved over the previous fiscal year thanks primarily to higher sales of corn seed in the U.S., Brazil and Europe and to higher herbicide sales outside the U.S.