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"We expect to have signed agreement by the end of the third quarter
to sell our global chocolate business," said ADM President Juan
Luciano on a conference call with analysts to discuss the
Illinois-based company's second-quarter report.
The company reported higher-than-expected earnings of $533 million,
or 81 cents per share, up from $223 million, or 34 cents a share a
year earlier, citing strong U.S. exports and demand for ethanol.
ADM is one of the world's top three cocoa dealers. In April, the
company said it would keep its cocoa presses, which make up about
two-thirds of its cocoa business, but still sell its chocolate
business after long-running negotiations to sell both operations to
a buyer collapsed.
ADM has about six chocolate facilities, the company previously
stated.
ADM's processing of cocoa and other unspecified commodities made its
second-straight quarterly profit at $20 million, up from a loss of
$17 million in the year-ago period.
"In cocoa, the margin environment remained good," Luciano said.
The company took a $1 million charge related to its cocoa hedges,
its second straight quarterly hedging loss, versus a gain of $11
million in the second quarter of 2013. This comes as cocoa futures
prices soared to three-year highs around $3,150 per tonne.
Strong demand for cocoa butter, a main byproduct of the bean that
gives chocolate its melt-in-the-mouth texture, caused its ratio to
soar. Meanwhile, demand for cocoa powder, which is used in baked
goods, chocolate drinks and ice cream, is weak and caused its price
to tumble. (Reporting by Marcy Nicholson in New York and Tom
Polansek in Chicago; Editing by Jeffrey Benkoe and Nick Zieminski)
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