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Archer Daniels (ADM) Q1 Earnings Beat Estimates, Revenues Down
Archer Daniels (ADM) Q1 Earnings Beat Estimates, Revenues Down
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Archer Daniels Midland Company ADM posted first-quarter 2024 results, with the top line missing the Zacks Consensus Estimate and the bottom line beating the same. Both metrics declined year over year.Adjusted earnings of $1.46 per share in the first quarter outpaced the Zacks Consensus Estimate of $1.35. However, the figure declined 30% from earnings of $2.09 per share in the year-ago quarter. On a reported basis, Archer Daniels’ earnings were $1.42 per share, down 33% from the year-ago quarter’s $2.12.Revenues fell 9.5% year over year to $21.8 billion and missed the consensus estimate of $22.4 billion.Segment-wise, revenues for Ag Services & Oilseeds fell 7.3% year over year and Carbohydrate Solutions’ revenues dropped 24.1% year over year. Also, Nutrition witnessed a year-over-year revenue dip of 0.9%.Archer Daniels Midland Company Price, Consensus and EPS SurpriseArcher Daniels Midland Company price-consensus-eps-surprise-chart | Archer Daniels Midland Company QuoteMeanwhile, we projected revenues for Ag Services & Oilseeds and Carbohydrate Solution segments to decline 7.9% and 9.1%, respectively. We estimated Nutrition revenues to drop 2%.The gross profit decreased 19% year over year to $1.7 billion but exceeded our estimate of $1.6 billion. Meanwhile, the gross margin fell 100 basis points to 7.6% in the quarter. The metric fared better than our estimate of 7.1%. SG&A expenses rose 7.9% year over year to $951 million. We expected SG&A expenses to edge up 1.3%.Archer Daniels reported an adjusted segmental operating profit of $1.3 billion, down 24% from the year-ago quarter. On a GAAP basis, ADM’s segmental operating profit fell 24% year over year to $1.3 billion.Segmental Operating ProfitAdjusted operating profit for Ag Services & Oilseeds fell 29% year over year to $864 million. The decline was driven by the stabilization of trade flows leading to lower Global Trade and risk management results year over year. Slow farmer selling hurt export volumes and margins in South America. In the Crushing subsegment, operating profit fell 27% year over year as increased imports of used cooking oil and the anticipation of large South American supplies weighed on North American soy crush margins. Equity earnings from Wilmar were about 37% higher year over year.The Carbohydrate Solutions segment’s adjusted operating profit decreased 11% year over year to $248 milli...