Monsanto returns to profitability
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| A farmer holding Monsanto's Roundup Ready Soy Bean seeds on July 5, 2008 at his family farm in Bunceton, Mo. Monsanto Co., the world's biggest seed maker, said Thursday that higher seed sales helped it return to profitability in the first quarter compared with a loss in the same three-month period last year. (AP file phote) |
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Monsanto Co. on Thursday said it returned to profitability in the fiscal first quarter as sales of genetically modified corn, soybean and cotton climbed.
The St. Louis company reported higher sales of corn, soybean, vegetable and cotton seeds. It also posted higher sales of its Roundup weed-killer despite tight competition from a variety of generic versions.
Monsanto reported a net income of $6 million, or 2 cents per share, for the quarter ending Nov. 30, compared with a loss of $19 million, or 2 cents a share, in the year-ago period. Revenue increased 8 percent to $1.83 billion.
Analysts surveyed by Thomson Reuters had expected earnings of 1 cent per share on revenue of $1.79 billion.
While its seed business lost money, partly because of restructuring costs, Monsanto said revenue from seed sales rose 13 percent to $1.16 billion. Sales of corn seeds and traits rose 8 percent to $614 million, while soybean revenue climbed 12 percent to $226 million, and vegetable revenue grew 6 percent to $183 million. Cotton revenue surged 90 percent to $112 million.
The company sales of Roundup and other herbicides rose 3 percent to $523 million. Monsanto’s agricultural productivity business, which includes herbicides and other products, turned a profit in the fourth quarter. Roundup was once the company’s biggest moneymaker, but a slew of cheaper versions made by Chinese companies reached the market in 2009. Monsanto was forced to cut prices and restructure its business. It also acknowledged its goal of doubling its annual profit
Monsanto said it cut general and administrative expenses 9 percent after restructuring operations last year, and it increased research and development spending 13 percent.
The company backed its Fiscal Year 2011 profit forecast of $2.72 to $2.82 per share. Analysts expect the company to earn $2.81 per share on average.
Shares rose $1.89, or 2.7 percent, to $71.02 in afternoon trading. The stock gained as much as 5.1 percent in morning trading.
