Archer-daniels-midland Company · NYSE:ADM
Archer-daniels-midland — Q2 2023 Earnings Presentation
28 slides from Archer-daniels-midland's earnings presentation, Jul 25, 2023
Slide 1: Second Quarter 2023 Earnings Conference Call
1 Proprietary business information of ADM. Second Quarter 2023 Earnings Conference Call July 25, 2023
Slide 2: Safe Harbor Statement
Safe Harbor Statement 2 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 performance and financia
Slide 3: Financial Highlights
Financial Highlights 3 Proprietary business information of ADM. 2Q 2023 2Q 2023 Trailing 4-Quarter Adjusted Earnings Adjusted Segment Adjusted ROIC1 Per Share1,2 Operating Profit1,3 $1.89 $1.6B 13.8% 1H 2023 1H 2023 1H 2023 Adjusted Earnings Adjusted Segment Cash from Operations Per Share1,2 Operati
Slide 4: Key Strategic Accomplishments through 1H23
Key Strategic Accomplishments through 1H23 4 Proprietary business information of ADM.
Slide 5: Proprietary business information of ADM.
Proprietary business information of ADM. 5
Slide 6: Ag Services & Oilseeds
Ag Services & Oilseeds 6 Higher First Half Results vs. Prior Year Supporting Food Proprietary business information of ADM. Security Segment Operating Profit Strategic investment to expand port capabilities at Santos, enabled record export volumes in Brazil
Slide 7: Carbohydrate Solutions
Carbohydrate Solutions 7 Continued Solid Performance Proprietary business information of ADM. Continuing the Carbs Evolution Segment Operating Profit BioSolutions Q2 revenue growth of 22%
Slide 8: Nutrition
Nutrition 8 Lower Results on Constant Currency Basis1 Industry Leading Proprietary business information of ADM. Human Nutrition Results Flat versus Prior Year Win-Rates 34% total increase in Revenue Segment Operating Profit Nutrition pipeline year-over-year (1)Non-GAAP measure - see note on page 28
Slide 9: Other Business Results and Corporate
Other Business Results and Corporate 9 Proprietary business information of ADM. Other Business Corporate $(321) $(393) $(589) $(715)
Slide 10: Robust Financial Flexibility to Support Strategic Growth
Robust Financial Flexibility to Support 10 Strategic Growth Proprietary business information of ADM. Q2 YTD'23 Capital Expenditures $0.6 billion Cash from Operations Before Q2 YTD'23 Dividends Working Capital1 $0.5 billion Q2 YTD'23 Share Repurchases $1.0 billion 2.5x "A" credit rating threshold 1.5
Slide 11: Proprietary business information of ADM.
11 Proprietary business information of ADM.
Slide 12: Additional Facts and Information
Additional Facts and Information
Slide 13: Industry Environment
Industry Environment 13 Proprietary business information of ADM. Farmer Selling2 Current Q1 Call Spot Gross US$/MT US$/MT 2022/2023 Crop Year 2023/2024 Crop Year Crush Margins1 5-Year Prior 5-Year Prior Current Year Current Soybeans Average Average Year US $70-$80 $55-$65 Corn Europe $20-$30 $45-$55
Slide 14: ADM Additional Information
ADM Additional Information 14 Proprietary business information of ADM. Processed Volumes by Quarter (000s of metric tons) Adjusted EBITDA(1)(2) by Segment (in millions) Trailing 4-Quarters CY 22 CY 23 Q2 23 Q2 22 Q2 23 Q2 22 Q1 Q2 Q3 Q4 Q1 Q2 Adjusted EBITDA(1)(2) $ 1,629 $ 1,866 $ 6,714 $ 5,948 Oil
Slide 15: ADM Additional Information
ADM Additional Information 15 Proprietary business information of ADM. Nutrition Revenues (amounts in millions) Nutrition Operating Profit (amounts in millions) Growth vs. Growth vs. Growth vs. Growth vs. Q2 23 Q2 22 YTD FY23 YTD FY22 Q2 23 Q2 22 YTD FY23 YTD FY22 GAAP Revenues GAAP Operating Profit
Slide 16: Financial Appendix
16 Financial Appendix
Slide 17: Q2 2023 Financial Highlights
17 Q2 2023 Financial Highlights Proprietary business information of ADM. Quarter Ended June 30 (Amounts in millions except per share data and percentages) 2023 2022 Change Adjusted earnings per share (1) (2) $1.89 $2.15 ($0.26) Total segment operating profit (unadjusted) (3) $1,525 1,840 ($315) Adju
Slide 18: Q2 Adjusted Segment OP $1.6 Billion
18 Q2 Adjusted Segment OP $1.6 Billion Proprietary business information of ADM. Adjusted segment operating profit (1,2) (in millions) Excludes specified items Q2 2022 Q3 2022 Q4 2022 Q1 2023 Q2 2023 $1,849 $1,579 $1,665 $1,725 $1,628* *Segment operating profit as reported was $1.5B (1)Non-GAAP measu
Slide 19: Segment Operating Profit and Corporate Results
Segment Operating Profit and Corporate Results 19 Quarter Ended June 30 (Amounts in millions) 2023 2022 Change Proprietary business information of ADM. Total Segment Operating Profit(1) $ 1,525 $ 1,840 $ (315) Specified items: Gain on sale of assets (11) — (11) Impairment and restructuring charges a
Slide 20: Balance Sheet Highlights
20 Balance Sheet Highlights Proprietary business information of ADM. June 30 (Amounts in millions) 2023 2022 Cash (1) $ 1,426 $ 906 Net property, plant, and equipment 10,127 9,680 Operating working capital (2) 10,898 14,537 - Total inventories 11,902 14,485 Total debt 8,670 11,518 - CP outstanding —
Slide 21: Cash Flow Highlights
21 Cash Flow Highlights Proprietary business information of ADM. Six Months Ended June 30 (Amounts in millions) 2023 2022 Cash from operations before working capital changes $ 2,490 $ 3,218 Changes in working capital (1,591) (3,893) Purchases of property, plant, and equipment (614) (500) Sub-total 2
Slide 22: GAAP Statement of Earnings Summary
GAAP Statement of Earnings Summary 22 Proprietary business information of ADM. Quarter Ended June 30 (Amounts in millions except per share data) 2023 2022 Change Revenues $ 25,190 $ 27,284 $ (2,094) Gross profit 1,883 2,100 (217) Selling, general and administrative expenses 841 814 27 Asset impairme
Slide 23: Adjusted Earnings Per Share (EPS)
23 Adjusted Earnings Per Share (EPS) Proprietary business information of ADM. Quarter Ended June 30 2023 2022 (Amounts in millions except per share data) Pre-tax After-tax Per share Pre-tax After-tax Per share Earnings and EPS (fully diluted) as reported $ 1,132 $ 927 $ 1.70 $ 1,519 $ 1,236 $ 2.18 A
Slide 24: ROIC versus WACC
24 ROIC versus WACC Trailing 4Q Average Adjusted ROIC(1)(2) Q2 CY23 13.8 % LT ROIC Objective: 10% Proprietary business information of ADM. Annual WACC 8.00 % Trailing 4Q Average Adjusted EVA $2.0B Long-Term WACC 7.0 % Trailing 4Q Average ROIC (1)(3) 13.3 % (1)Non-GAAP measure - see notes on page 28
Slide 25: Return on Invested Capital
25 Return on Invested Capital Proprietary business information of ADM. Adjusted ROIC Earnings(1) (Amounts in millions) Four Quarters Quarter Ended Ended Sep. 30, 2022 Dec. 31, 2022 Mar. 31, 2023 Jun. 30, 2023 Jun. 30, 2023 Net earnings attributable to ADM $ 1,031 $ 1,019 $ 1,170 $ 927 $ 4,147 Adjust
Slide 26: Adjusted EBITDA
26 Adjusted Earnings Before Taxes, Interest, and Depreciation and Amortization (EBITDA)(1) Four Quarters Ended June 30, 2023 Proprietary business information of ADM. Adjusted EBITDA(1) (Amounts in millions) Four Quarters Quarter Ended Ended Sep. 30, 2022 Dec. 31, 2022 Mar. 31, 2023 Jun. 30, 2023 Jun
Slide 27: Adjusted Net Debt to Adjusted EBITDA
Adjusted Net Debt to Adjusted EBITDA 27 Proprietary business information of ADM. Adjusted Net Debt June 30 (Amounts in millions) 2023 2022 Short-term debt $ 125 $ 2,352 Current maturities of long-term debt 301 1,104 Long-term debt 8,244 8,062 Total Debt 8,670 11,518 Cash and cash equivalents (1,426)
Slide 28: Notes: Non-GAAP Reconciliation
28 Notes: Non-GAAP Reconciliation 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 United States, and
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