Monsanto to Chop 1,000 More Jobs

Monsanto, buffeted by a weak agricultural economy, warned of lower profits in the year ahead and said it plans to step up job cuts and restructuring plans. The world's largest seed maker by revenue said brisker sales of soybeans to South American farmers and fast progress on previously outlined cost-reduction plans helped it report a smaller-than-expected first-quarter loss. But Monsanto said it continued to struggle against punishing currency swings and a slump in major crop prices that has curbed farmers' incomes and spending. "Currency has become a much stronger headwind with the recent events in Argentina," said Hugh Grant, Monsanto's chief executive, referring to the country's move in December to devalue its currency. Though the move by Argentina--a major South American market for Monsanto--will boost its agricultural sector over the long-term, Mr. Grant said, it will push Monsanto's 2016 profits to the lower end of the company's projected range. The St. Louis company said it intends to ramp up its restructuring efforts and cut another 1,000 jobs after unveiling plans in October to eliminate 2,600 positions. The company anticipates recording $1.1 billion to $1.2 billion in restructuring charges, up from $850 million to $900 million previously forecast. Monsanto reported that revenue slid 23% in the quarter ended Nov. 30 from a year earlier as corn sales weakened. For the year ending in August, the crop-biotechnology company said it expects to come in at the low end of its adjusted earnings guidance of $5.10 to $5.60 a share, citing the currency devaluation in Argentina. Shares slipped 0.6% to $96.16 in early trading. Monsanto is streamlining its business as seed, pesticide and equipment makers grapple with a three-year slide in crop prices that has forced farmers to scale back spending on tractors and farm supplies. The U.S. Department of Agriculture projected in November that U.S. farm income would drop 38% in 2015 to the lowest level in more than 10 years. Those financial pressures have touched off a wave of consolidation talks as seed and pesticide makers look for ways to expand and slice costs. Monsanto last year pursued rival Syngenta AG but dropped the $46 billion acquisition proposal last year after being repeatedly rejected. In December, Syngenta's top executive indicated the Swiss firm was open to combinations with companies including Monsanto. That came after the announced merger deal between DuPont Co. and Dow Chemical Co., both major agricultural suppliers, which eventually could pose a greater competitive threat in the global seed-and-pesticide industry. Mr. Grant, acknowledging the merger of two of Monsanto's largest competitors, told analysts on a conference call Wednesday that the combination wouldn't likely change DuPont and Dow's status as major licensees of Monsanto's crop gene technology. "We expect that to continue," he said. For its fiscal first quarter, Monsanto swung to a loss of $253 million, or 56 cents a share, from a year-earlier profit of $243 million, or 50 cents a share. Excluding restructuring charges and other items, the per-share loss was 11 cents. Monsanto forecast an adjusted loss of 23 cents to 33 cents a share. Revenue slid 23% to $2.22 billion, while analysts forecast sales of $2.39 billion, according to Thomson Reuters. Corn sales--Monsanto's biggest source of profit--fell 20% to $745 million. Soybean sales grew 11% to $438 million. U.S. farmers have dedicated more fields to soybeans in pursuit of higher profits, and Monsanto has rolled out new soybean seed varieties in North and South America. Sales in the company's agricultural productivity segment, which includes its Roundup weed killer, fell to $820 million from $1.25 billion a year earlier. Write to Jacob Bunge at jacob.bunge@wsj.com and Chelsey Dulaney at Chelsey.Dulaney@wsj.com