MINNEAPOLIS – Cargill’s earnings took a tumble in the fourth quarter to the tune of $51 million. David MacLennan, president and CEO, attributed the loss to an asset impairment taken at the corporate level and an additional charge related to Venezuela’s currency devaluation.
For the most recent quarter ended May 31, the company reported a net loss of $51 million compared to earnings of $376 million, adjusted to reflect Venezuela’s currency devaluation. Revenues for the quarter were $28.4 billion, compared to $36.2 billion in 2014.
|David MacLennan, president and CEO of Cargill.|
“While several Cargill businesses generated very strong earnings in fiscal 2015, we lagged results from the prior year and did not meet our own expectations,” MacLennan said in the earnings announcement. “The economic environment remains sluggish in many emerging markets where we have invested significantly over the past several years. Even so, we aim for growth and profitability through these cycles. We are moving forward with good progress on changes begun last year to optimize the business portfolio, reduce costs and increase operational effectiveness.”
For the full fiscal year, earnings declined 13 percent to $1.58 billion from $1.82 billion in the prior year. Revenues fell 11 percent to $120.4 billion. Cash flow from operations climbed 1 percent to total $3.82 billion.
Soft performances in some animal proteins weighed on earnings in Cargill’s animal protein and nutrition business. High prices for cattle were the biggest factor, as beef was less competitive relative to other proteins. For the full year, the business was profitable due to strong performances in global animal nutrition, Central American poultry and US pork, turkey and egg further processing.
“The segment executed extremely well, drawing on its global reach, diverse products and services, and lower feed input costs,” the company said.
In the first quarter of fiscal year 2016, Cargill agreed to sell its pork business to JBS USA, a unit of Sao Paulo, Brazil-based JBS SA, pending regulatory approval. The transaction is valued at $1.45 billion.