Monsanto, the world’s biggest seed supplier, said on Tuesday that fiscal second quarter earnings topped analyst estimates and said its results were boosted in part by strong profit growth from its corn and soyabean business and the sale of its seed treating business.
The St Louis-based company which is in the process of being acquired by German chemical conglomerate Bayer, said profits rose to $1.4bn or $3.09 a share, compared with $1.1bn or $2.41 a share in the year ago period. Ongoing earnings per share of $3.19 topped analyst estimates of $2.79.
The company also said sales jumped nearly 12 per cent to $5.1bn, topping Wall Street expectations of $4.7bn.
Results were lifted by profit growth from its corn and soyabean businesses — its two largest divisions — the absence of impact from the Argentine peso devaluation and from the sale of its Latitude wheat fungicide business to Japanese trader Mitsui for $140m, with an expected Ebit benefit of about $85m.
“We are delighted to have delivered such an excellent first half and strong second quarter, in the face of what is still a tough macro economy for agriculture,” said Hugh Grant, Monsanto chairman and chief executive.
He added: “Our proven innovation and unique platform advantages position us well to meet the challenges ahead, as well as make us an attractive, complementary partner for Bayer.”
In an effort to bolster its chances of combining with Monsanto to create the world’s largest supplier of seeds and crop sprays to farmers, Bayer pledged to invest $8bn in research and development in the US over the next six years.
Monsanto also said it expects earnings in the current fiscal year to be at the high end of the range of $4.50 to $4.90 a share, compared with analysts estimates of $4.75. Sales compared with analyst estimates of $4.7bn.
Monsanto shares are up more than 9 per cent so far this year and were up 1.7 per cent in pre-market trading.