Archer Daniels Midland profit misses estimates

[February 05, 2019]    (Reuters) - U.S. grains trader Archer Daniels Midland Co on Tuesday missed Wall Street estimates for quarterly profit, hurt by higher expenses and lower margins in its origination business.

The Archer Daniels Midland Co. (ADM) logo is displayed on a screen on the floor of the New York Stock Exchange (NYSE) in New York, U.S., May 3, 2018. REUTERS/Brendan McDermid

The crop trader has been facing a slump in commodity prices due to a global soy and corn surplus and the U.S.-China trade dispute.

The company has four different business units that include origination, carbohydrate solutions, nutrition and oilseeds. Chicago-based ADM has been trying to invest in higher-margin businesses to boost earnings in a volatile commodity market.

ADM's origination business, which includes grain trading, fell nearly 30 percent to $ 183 million in the quarter. Its expenses jumped 21.6 percent to $558 million.

Net earnings attributable to ADM fell to $315 million, or 55 cents per share, in the three months ended Dec. 31, from $788 million, or $1.39 per share, a year earlier, when the company recorded $249 million in tax gains.

Excluding one-time items, the company earned 88 cents per share, while analysts on average had estimated 92 cents, according to IBES data from Refinitiv.

Revenue fell to $15.95 billion from $16.07 billion.

(Reporting by Arundhati Sarkar in Bengaluru; Editing by Arun Koyyur)

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