Thursday, agribusiness and food company Bunge Ltd. (BG) reported a loss for the first quarter, hurt primarily by high cost fertilizer inventories and aggressive pricing by competitors, which pressured margins, as well as a slump in global demand for soybean-based products. Further, the company lowered its earnings per share outlook to a range below analysts' current estimates.
Incidentally, Bunge is reporting its second consecutive loss, amid the general weakness and margin pressure prevailing in the fertilizer industry. Bunge's net loss for the quarter was $176 million compared with a net income of $322 million in the prior-year quarter.
The White Plains, New York-based company's net loss attributable to common shareholders was $214 million, or $1.76 per share, compared with a net income of $270 million, or $2.10 per share, in the year-ago quarter. Net loss attributable to Bunge for the quarter was $195 million compared with a net income of $289 million last year.
On average, six analysts polled by Thomson Reuters expected the company to report earnings of $0.49 per share for the quarter. Analysts' estimates typically exclude special items.
For the sequentially preceding fourth quarter, Bunge reported a net loss of $210 million compared to net income of $245 million for the fourth quarter of 2007. On a per share basis, fourth-quarter loss was $1.89, compared with earnings of $1.82 last year.
Total segment earnings before interest and tax, a non-GAAP measure, was a loss of $203 million, down from earnings before interest and tax of $442 million in the comparable quarter a year ago. Gross profit for the quarter plunged 84% to $135 million from $867 million in the prior year.
First quarter net sales dropped 26% to $9.2 billion from $12.47 billion a year ago, and came in below analysts' estimate of $11.0 billion. Volumes for the quarter increased 2% to 32,251 metric tons from 31,763 metric tons in the prior year. Net sales for the fourth quarter dropped 12% to $10.94 billion from $12.47 billion reported for the same period last year.
On a segmental basis, for the first quarter, net sales of Agribusiness fell 25% to $6.63 billion from $8.86 billion in the prior-year quarter. Bunge said that higher results in grain origination primarily due to strong soybean demand from China were more than offset by lower results in oilseed processing and distribution.
Fertilizer net sales for the quarter were $699 million, down 41% from $1.19 billion a year earlier. The company noted that first-quarter results of its Fertilizer segment included an inventory valuation write-down of $64 million. The segment experienced an operating loss due to lower selling prices, higher raw material and finished product inventory costs.
Edible oil products generated net sales of $1.49 billion, a decrease of 23% from $1.93 billion in the comparable quarter a year ago. The segment was affected by lower margins in Brazil, which resulted from high cost crude vegetable oil inventories and aggressive product pricing by competitors.
Net sales of Milling products declined 23% to $376 million from $486 million in the year-ago quarter.
Looking forward, the company revised its full-year 2009 earnings per share outlook and now expects to report $4.90 to $5.40, down from the prior guidance of $6.90 to $7.60. Analysts' currently expect the company to report EPS in a range of $5.94 to $7.03, with a consensus of $6.56 for the full year.
Additionally, Bunge sees soybean meal demand for the calendar year to increase about 1% compared to the prior year. The company also expects higher commodity prices, resulting from tighter global oilseed stocks, to help stimulate sales of fertilizer products in the second half of the year when South America enters its next major planting season.
In February, peers Archer Daniels Midland Co. (ADM) reported a 24% increase in second-quarter net profit and Corn Products International, Inc. (CPO) reported nearly flat fourth-quarter net income.
Decatur, Illinois-based Archer Daniels Midland reported a 24% increase in second-quarter net profit to $585 million, or $0.91 per share, from $473 million, or $0.73 per share, in the prior-year quarter. Archer Daniels Midland's net sales and other operating income for the quarter inched up 1% to $16.67 billion from $16.50 billion in the same quarter last year.
Westchester, Illinois-based Corn Products International is scheduled to release its first-quarter financial results on April 28. Currently, analysts expect the company to report earnings of $0.49 per share on revenues of $843.17 million. Bunge, in the fourth-quarter, terminated its $4.8 billion deal to acquire Corn Products International that reported nearly flat fourth-quarter net income and sales.
In Thursday's regular trading session, BG is currently trading at $47.15, down $7.35 or 13.49% on a volume of 1.84 million shares. In the past 52 weeks, the stock traded in a broad range of $27.60 - $127.64, with a three-month average of 1.92 million shares.
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June 12, 2026 17:14 ET Major central bank action was the focus this week in economic news. The European Central Bank became the first major central bank to move in response to the rising inflationary pressures in the backdrop of the conflict in the Middle East. In North America, the U.S. inflation and trade data as well as Canada’s central bank decision gained attention. The Chinese trade data was the main news in Asia.