Monsanto Posts Better-Than-Expected Jump in 2Q Profit

Earnings Reuters

U.S. seeds and agrochemicals company Monsanto Co <MON.N>, which is being bought by Germany's Bayer AG <BAYGn.DE> for $66 billion, reported a better-than-expected quarterly profit on Wednesday, helped by strong demand for its soybean and corn seeds.

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Monsanto said sales of corn seed and traits rose 8 percent, while sales of soybean seeds and traits jumped 10.2 percent in the second quarter ended Feb. 28, as farmers in the United States prepare to plant the largest combined corn and soybean acres on record.

Monsanto agreed in September to a $128-per-share buyout offer from Bayer that, if approved by regulators, would create a company commanding more than a quarter of the world market for seeds and pesticides.

In February, Bayer said it was on track to clear all regulatory hurdles for the merger by year-end. Reuters reported last month that the two companies were launching asset sales worth roughly $2.5 billion as they seek regulatory clearance.

Monsanto, best known for its Roundup herbicide and genetically-engineered corn and soybean seeds, also said it now expects full-year ongoing earnings per share at the high end of its forecast range.

The company had expected ongoing earnings of $4.50 to $4.90 per share for its 2017 fiscal year.

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Net profit attributable to Monsanto rose to $1.37 billion, or $3.09 per share, in the second quarter, from $1.06 billion, or $2.41 per share, a year earlier.

Excluding one-time items, Monsanto earned $3.19 per share, topping analysts' average estimate of $2.79 per share, according to Thomson Reuters I/B/E/S.

Net sales rose 12 percent to $5.07 billion. Analysts on average had expected sales of $4.73 billion.

Monsanto's shares were up 2.4 percent at $116.95 in premarket trading.

(This story corrects Bayer AG's stock symbol in paragraph one)

 

(Reporting by Arathy S Nair in Bengaluru; Editing by Sai Sachin Ravikumar)