advertisement

Monsanto posts smaller loss in fourth quarter

Wednesday, October 6, 2010 | 5:49 p.m. CDT

ST. LOUIS — Monsanto Co. is promising brighter days ahead.

The world's biggest seed company reported a smaller loss Wednesday for its fiscal fourth quarter than a year ago as its revenue increased. The company said the results are the first sign it has put behind it a period of layoffs and lost sales resulting from a sharp drop-off in its herbicide business.

The quarter is typically a money loser for Monsanto, which makes more of its money in the spring and summer months as farmers are ordering seed. But the company said its narrower loss is the result of a broad restructuring that will deliver double-digit growth in coming years.

"There's no doubt we're looking forward to seeing the results of changes we've made in a new fiscal year," Chief Executive Hugh Grant said during a conference call Wednesday morning.

The restructuring is aimed at moving Monsanto away from its less profitable herbicide division. Its flagship Roundup brand has been pummeled by foreign, generic versions, which contributed to a 10 percent revenue decline during fiscal year 2010.

Monsanto said its turnaround is already showing results. Roundup sales have bounced back after Monsanto slashed prices to match generic versions, and the company thinks sales have hit a "steady state" going forward.

Monsanto shares rose 13 cents to $48.65.

The St. Louis company lost $139 million, or 26 cents a share, in the quarter ended Aug. 31 versus a loss of $233 million, or 43 cents a share, a year ago.

Monsanto's quarterly loss was 9 cents a share from ongoing operations. Analysts had been looking for a loss of 6 cents per share. They typically exclude one-time items from their estimates.

Revenue rose to $1.95 billion from $1.88 billion a year ago.

Corn seed and traits revenue rose to $424 million from $387 million. Soybean seeds and trait revenue rose to $103 million from $81 million during the prior year period.

Grant said Monsanto is well on its way in making a transition from being an old-line maker of herbicides and pesticides to a company increasingly dependent on developing new strains of genetically engineered crops.

The seeds and genomics division represented more than 70 percent of the company's net sales for the year, which offset losses from Roundup.

Net income for the full year fell to $1.1 billion, or $2.01 a share, from $2.1 billion, or $3.80 a share, a year ago. Revenue fell to $10.5 billion from $11.72 billion a year earlier.

Increased seed sales will push Monsanto earnings to between $2.72 and $2.82 per share on an ongoing basis during fiscal year 2011, the company said. That's up from $2.41 per share on an ongoing basis in 2010.


Like what you see here? Become a member.


Show Me the Errors (What's this?)

Report corrections or additions here. Leave comments below here.

You must be logged in to participate in the Show Me the Errors contest.


Comments

Leave a comment

Speak up and join the conversation! Make sure to follow the guidelines outlined below and register with our site. You must be logged in to comment. (Our full comment policy is here.)

  • Don't use obscene, profane or vulgar language.
  • Don't use language that makes personal attacks on fellow commenters or discriminates based on race, religion, gender or ethnicity.
  • Use your real first and last name when registering on the website. It will be published with every comment. (Read why we ask for that here.)
  • Don’t solicit or promote businesses.

We are not able to monitor every comment that comes through. If you see something objectionable, please click the "Report comment" link.

You must be logged in to comment.

Forget your password?

Don't have an account? Register here.

advertisements