Profit at Cargill Inc. -- global purveyor of salt, oils, hamburger, financial derivatives and a world of other products -- plunged nearly 60 percent in the second quarter of its fiscal year, largely on weak global demand for crop fertilizers.
The Minnetonka-based agribusiness giant reported a profit of $489 million in its 2010 second quarter ended Nov. 30, down from $1.19 billion a year earlier. Excluding the decline in earnings from its majority investment in Mosaic, the Plymouth-based fertilizer company, Cargill's results were "more moderately below" year-ago levels, it said.
Mosaic reported lousy results last week, with lower selling prices for potash and phosphates helping to hammer earnings, which fell 90 percent to $107.8 million, while sales tumbled 43 percent to $1.7 billion.
The second half of 2008, with volatile commodity prices, produced record results for both companies, affecting year-ago comparisons.
The largest contributor to Cargill's profits in the second quarter was its food ingredients and applications segment, which benefited from lower raw materials costs, and its agriculture services segment, a spokeswoman said. Results from Cargill's considerable risk management operations -- which include hedge fund and private equity businesses -- were "much improved" from a year earlier, the company said.
For the first half of its 2010 fiscal year, Cargill earned $1.01 billion -- off more than 60 percent from the record $2.68 billion it recorded in the first half a year earlier but better than the preceding two quarters.
"The pickup in performance reflects our continued focus on holding down costs, tapping both developed and faster-growing emerging markets, and reinvesting our capital in the future growth of the company and our customers," Cargill Chairman and CEO Greg Page said.
Source: Minneapolis Star Tribune
