Archer-daniels-midland Company · NYSE:ADM
Archer-daniels-midland — Q1 2020 Earnings Presentation
28 slides from Archer-daniels-midland's earnings presentation, Apr 30, 2020
Slide 1: First Quarter 2020 Earnings Conference Call
First Quarter 2020 Earnings Conference Call April 30, 2020
Slide 2: Safe Harbor Statement
2 Safe Harbor Statement Confidential and proprietary business information of ADM. Some of our comments and materials in this presentation constitute forward-looking statements that reflect management’s current views and estimates of future economic circumstances, industry conditions, Company perform
Slide 3: Chairman's Commentary
3 Chairman’s Commentary Confidential and proprietary business information of ADM. I’m extremely grateful to our 38,000 global colleagues, whose commitment, ingenuity and agility are powering ADM as we support the global food supply chain and provide nutrition around the Juan Luciano world.” ADM Chai
Slide 4: Q1 Accomplishments
4 Q1 Accomplishments Confidential and proprietary business information of ADM. • Further improved capital • Thousands of global • Achieved Neovia synergy efficiency in AS&O colleagues enabled by IT to targets ahead of schedule • Realized benefits from work virtually • Expanded production of non- enh
Slide 5: Q1 2020 Financial Highlights
5 Q1 2020 Financial Highlights Confidential and proprietary business information of ADM. (in millions except per share data and percentages) Quarter Ended Mar. 31 2020 2019 Change Adjusted earnings per share (1) (2) $0.64 $0.46 $0.18 Total segment operating profit (unadjusted) (3) $599 $611 ($12) Ad
Slide 6: Balance Sheet Highlights
6 Balance Sheet Highlights Confidential and proprietary business information of ADM. (Amounts in millions) Mar. 31, 2020 Mar. 31, 2019 Cash (1) $4,734 $935 Net property, plant, and equipment 9,883 10,299 Operating working capital (2) 7,985 8,175 - Total inventories 8,830 8,946 Total debt 12,503 9,88
Slide 7: Q1 Other and Corporate Results
7 Q1 Other and Corporate Results (In millions) Confidential and proprietary business information of ADM. Other Business • Other results down on futures Q1 2019 Q2 2019 Q3 2019 Q4 2019 Q1 2020 commission loss provision, partially $14 $11 $47 $13 $11 offset by improvements in captive insurance Corpora
Slide 8: AS&O: Strong Results Driven by Ag Services
8 AS&O: Strong Results Driven by Ag Services Confidential and proprietary business information of ADM. Segment operating profit (in millions) • Ag Services more than double Q1 2019 Q2 2019 Q3 2019 Q4 2019 Q1 2020 prior year, driven by global $417 $362 $417 $739 $422 trade results and South America o
Slide 9: Carbohydrate Solutions: Weaker Quarter, Mixed Results YOY
9 Carbohydrate Solutions: Weaker Quarter, Mixed Results YOY Confidential and proprietary business information of ADM. Segment operating profit (in millions) Q1 2019 Q2 2019 Q3 2019 Q4 2019 Q1 2020 • S&S impacted by negative MTM, $96 $192 $182 $174 $68 partially offset by Decatur improvements, streng
Slide 10: Nutrition: Record Results; OP up 75% YOY
10 Nutrition: Record Results; OP up 75% YOY Confidential and proprietary business information of ADM. Segment operating profit (in millions) Q1 2019 Q2 2019 Q3 2019 Q4 2019 Q1 2020 • Growth across Human Nutrition $81 $117 $118 $102 $142 portfolio of flavors, specialty ingredients, and health & welln
Slide 11: Proud to Be Fulfilling Our Purpose
11 Confidential and proprietary business information of ADM. Proud to Be Fulfilling Our Purpose
Slide 12: Upcoming Investor Events
12 Upcoming Investor Confidential and proprietary business information of ADM. Events (All events virtual) BMO 15th Annual Farm to Market Conference May 13-14 Goldman Sachs Industrial & Materials Conference May 15 Stifel Cross Sector Insight Conference June 8-10 Deutsche Bank Global Consumer Confere
Slide 13: Additional Facts and Explanations
Additional Facts and Explanations
Slide 14: Supplementary Q1 Earnings Information
14 Supplementary Q1 Earnings Information Confidential and proprietary business information of ADM. Q1 income tax expense includes a $73M discrete Full Year Effective Tax Rate Guidance item relating to 2018/2019 45G Railway Tax Credits, Reconciliation Impact with offsetting expense in ‘Corporate Othe
Slide 15: Industry Environment
15 Industry Environment Confidential and proprietary business information of ADM. Spot Gross Current Q4 Call 19/20 Farmer 5-Year Crush Margins1 US$/MT US$/MT Selling4 Current Average 2019 Soybeans: Corn: US $20-$25 $25-$30 US 69% 75% 75% Brazil 31% 25% 26% Europe $25-$35 $30-$40 Soybeans: Exp: $15-$
Slide 16: ADM Additional Information
16 ADM Additional Information Confidential and proprietary business information of ADM. Processed Volumes by Quarter (000s of metric tons) Adjusted EBITDA(1)(2) by Segment (in millions) CY 19 CY 20 Trailing 4-Quarters Q1 Q2 Q3 Q4 Q1 Q1 20 Q1 19 Q1 20 Q1 19 Oilseeds 9,167 8,773 9,062 9,269 9,163 Adju
Slide 17: Financial Appendix
17 Financial Appendix
Slide 18: Q1 Adjusted Segment OP $643 million
18 Q1 Adjusted Segment OP $643 million Confidential and proprietary business information of ADM. Adjusted segment operating profit (1,2) (in millions) Excludes specified items Q1 2019 Q2 2019 Q3 2019 Q4 2019 Q1 2020 $608 $682 $764 $1,028 $643* Ag Services and Oilseeds Carbohydrate Solutions Nutritio
Slide 19: Segment Operating Profit and Corporate Results
Segment Operating Profit and Corporate Results 19 Quarter Ended Mar. 31 (Amounts in millions) 2020 2019 Change (1) Total Segment Operating Profit $ 599 $ 611 $ (12) Confidential and proprietary business information of ADM. Specified items: (Gains) loss on sales of assets and businesses — (12) 12 Imp
Slide 20: Cash Flow Highlights
20 Cash Flow Highlights Confidential and proprietary business information of ADM. Three Months Ended Mar. 31 (Amounts in millions) 2020 2019 Cash from operations before working capital changes $839 $466 Changes in working capital (1) 551 (723) Purchases of property, plant, and equipment (194) (198)
Slide 21: GAAP Statement of Earnings Summary
21 GAAP Statement of Earnings Summary Confidential and proprietary business information of ADM. (Amounts in millions except per share data) Quarter Ended Mar. 31 2020 2019 Change Revenues $14,970 $15,304 ($334) Gross profit 951 928 23 Selling, general and administrative expenses 664 659 5 Asset impa
Slide 22: Adjusted Earnings Per Share (EPS)
22 Adjusted Earnings Per Share (EPS) (Amounts in millions except per share data) Confidential and proprietary business information of ADM. Quarter Ended Mar. 31 2020 2019 Pre-tax After-tax Per share Pre-tax After-tax Per share Earnings and EPS (fully diluted) as reported $ 375 $ 391 $ 0.69 $ 315 $ 2
Slide 23: ROIC versus WACC
ROIC versus WACC 23 Q1 CY20 LT ROIC Objective: 10% Confidential and proprietary business information of ADM. (1)(2) Trailing 4Q Average Adjusted ROIC 7.6 % Annual WACC 5.75 % Trailing 4Q Average Adjusted EVA $538M Long-Term WACC 7.0 % 11% Trailing 4Q Average ROIC (1)(3) 6.2 % 10% 9% 8% 7% 6% 5% 4% Q
Slide 24: Return on Invested Capital
24 Return on Invested Capital Confidential and proprietary business information of ADM. Adjusted ROIC Earnings(1) (Amounts in millions) Fourth Quarters Quarter Ended Ended June 30, 2019 Sep. 30, 2019 Dec. 31,2019 Mar. 31, 2020 Mar. 31, 2020 Net earnings attributable to ADM $ 235 $ 407 $ 504 $ 391 $
Slide 25: Adjusted EBITDA, Four Quarters Ended March 31, 2020
25 Adjusted Earnings Before Taxes, Interest, and Depreciation and Amortization (EBITDA)(1) Four Quarters Ended March 31, 2020 Confidential and proprietary business information of ADM. Adjusted EBITDA(1) (Amounts in millions) Fourth Quarters Quarter Ended Ended June 30, 2019 Sep. 30, 2019 Dec.31,2019
Slide 26: Adjusted EBITDA, Four Quarters Ended March 31, 2019
26 Adjusted Earnings Before Taxes, Interest, and Depreciation and Amortization (EBITDA)(1) Four Quarters Ended March 31, 2019 Confidential and proprietary business information of ADM. Adjusted EBITDA(1) (Amounts in millions) Fourth Quarters Quarter Ended Ended Jun. 30, 2018 Sep. 30, 2018 Dec.30,2018
Slide 27: 2019 Segment OP and Adjusted Segment OP Comparatives
27 2019 Segment OP and Adjusted Segment OP(1,2) Comparatives with VCP in Carbohydrate Solutions (in millions) Confidential and proprietary business information of ADM. Qtr. Ended Qtr. Ended Qtr. Ended Qtr. Ended Year Ended Mar. 31, 2019 Jun. 30, 2019 Sep. 30, 2019 Dec. 31, 2019 Dec. 31, 2019 As As A
Slide 28: Notes: Non-GAAP Reconciliation
28 Notes: Non-GAAP Reconciliation Confidential and proprietary business information of ADM. The Company uses certain “Non-GAAP” financial measures as defined by the Securities and Exchange Commission. These are measures of performance not defined by accounting principles generally accepted in the Un
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