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Agrichemicals firm Monsanto returns to profit in its first quarter helped by strength in South America

Thursday, January 5, 2017 7:57
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Agrichemicals firm Monsanto Co. (NYSE:MON), which is in the midst of being bought by Germany’s Bayer AG, said it returned to profitability in its first quarter.

The US group reported net income of US$29mln, or 7 cents a share for the quarter to the end-of-November, compared with a net loss of US$253mln, or 56 cents a share at the same stage a year earlier.

Monsanto said its total sales rose 19% to US$2.65bn, helped by strength in South America.

READ: Monsanto shareholders back merger …

It added that revenue from seeds and genomics – the firm’s biggest business – jumped by 32% to US$1.85bn.

Growth in the segment during the quarter was helped by a more than 25% increase in planted corn acres in Argentina and a more than a 10% increase in corn acres planted in Brazil.

But sales in Monsanto’s agricultural productivity division fell 2.2% to US$802mln.

Monsanto agreed to a US$57bn deal takeover from Bayer in September and the US firm said today that it still expects the transaction to close by the end of 2017.

Last month, the US firm’s shareholders voted almost unanimously to approve the merger at a special meeting, with approximately 99% of all votes cast – representing around 75% of all outstanding shares – in favour of the deal.

The acquisition, which would rank as the largest-ever takeover of a US company by a German firm, is moving toward regulatory reviews by the relevant authorities.

However, the election of Donald Trump as US president has raised some questions around large-scale merger deals and foreign investment in US companies.

Story by ProactiveInvestors


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