ADM Reports Second Quarter 2024 Results, Affirms Full-Year EPS Guidance
Reported EPS of
Second Quarter 2024 Highlights
-
Net earnings of
$486 million , adjusted net earnings1 of$508 million -
Earnings before taxes of
$596 million , segment operating profit1 of$1,014 million , adjusted segment operating profit1 of$1,021 million - Trailing four-quarter average return on invested capital (ROIC) of 8.9%, trailing four-quarter average adjusted return on invested capital (ROIC)1 of 9.7%
“ADM delivered solid results in the quarter, in spite of challenging market conditions, and we are pleased with the progress we are making against our 2024 priorities and strategic initiatives,” said Chair of the Board and CEO
“In Ag Services & Oilseeds, while large South American crops and shifts in farmer selling behaviors impacted results in the second quarter, we expect improved margin opportunities through the remainder of the year. In Carb Solutions, the team delivered solid results driven by favorable Starches & Sweeteners and ethanol margin environments, and we expect continued strong performance. And our actions to recover profitability in the Nutrition segment delivered sequential improvement in the quarter and set us up for continued increases moving forward. With solid performance and continued strong cash flow, we have returned significant cash to shareholders through our repurchase efforts through the first two quarters.
“In the second half of the year, improvements in both crush and ethanol, our efforts in operational excellence, the focus on our key priorities, and our team’s agility give us confidence in our full-year expectations, despite uncertainties in the external environment.”
Second Quarter and First Half 2024 Results
2Q 2024 Results Overview |
|
|
|
($ in millions except per share amounts) |
|
||
|
|
Earnings Before Taxes |
EPS (as reported) |
GAAP |
|
|
|
vs. 2Q 2023 |
|
(47)% |
(42)% |
|
|
|
|
|
Segment Operating Profit1 |
Adjusted Segment Operating Profit1 |
Adjusted EPS1 |
NON-GAAP |
|
|
|
vs 2Q 2023 |
(34)% |
(37)% |
(46)% |
1H 2024 Results Review
($ in millions except per share amounts) |
|
||
|
|
Earnings Before Taxes |
EPS (as reported) |
GAAP |
|
|
|
vs. 1H 2023 |
|
(41)% |
(37)% |
|
|
|
|
|
Segment Operating Profit1 |
Adjusted Segment Operating Profit1 |
Adjusted EPS1 |
NON-GAAP |
|
|
|
vs 1H 2023 |
(28)% |
(30)% |
(37)% |
1 Non-GAAP financial measures; see pages 6, 8, 13, and 14 for explanations and reconciliations. |
Summary of Second Quarter and First Half 2024
For the second quarter ended
Earnings before taxes were
Earnings before taxes were
2Q 2024 Segment Overview
($ in millions, except where noted) |
2Q 2024 |
2Q 20232 |
% Change |
Adjusted Segment Operating Profit1 |
|
|
(37)% |
Segment Operating Profit: |
|
|
|
Ag Services & Oilseeds |
459 |
1,054 |
(56)% |
Carbohydrate Solutions |
357 |
319 |
12% |
Nutrition |
109 |
169 |
(36)% |
Other |
96 |
86 |
12% |
|
|
|
|
1H 2024 Segment Overview
($ in millions, except where noted) |
1H 2024 |
1H 20232 |
% Change |
Adjusted Segment Operating Profit1 |
|
|
(30)% |
Segment Operating Profit: |
|
|
|
Ag Services & Oilseeds |
1,323 |
2,265 |
(42)% |
Carbohydrate Solutions |
605 |
598 |
1% |
Nutrition |
193 |
307 |
(37)% |
Other |
217 |
183 |
19% |
|
|
|
|
1 Non-GAAP financial measure; see pages 6 and 8 for explanation and reconciliation. |
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2 2023 Ag Services & Oilseeds, Carbohydrate Solutions, and Nutrition segment operating profits have been revised to reflect immaterial error corrections with no change to total Adjusted Segment Operating Profit. See Note 13, Segment Information of the Company’s consolidated financial statements included in the Quarterly Report on Form 10-Q for the quarter ended |
Ag Services and Oilseeds Summary
AS&O segment operating profit was
For the first half of 2024, AS&O delivered
2Q 2024 AS&O Overview
($ in millions, except where noted) |
2Q 2024 |
2Q 2023 |
% Change |
Segment Operating Profit |
|
|
(56)% |
Ag Services |
122 |
380 |
(68)% |
Crushing |
132 |
224 |
(41)% |
Refined Products and Other |
137 |
362 |
(62)% |
Wilmar |
68 |
88 |
(23)% |
|
|
|
|
1H 2024 AS&O Overview
($ in millions, except where noted) |
1H 2024 |
1H 2023 |
% Change |
Segment Operating Profit |
|
|
(42)% |
Ag Services |
354 |
728 |
(51)% |
Crushing |
445 |
651 |
(32)% |
Refined Products and Other |
307 |
689 |
(55)% |
Wilmar |
217 |
197 |
10% |
|
|
|
|
Carbohydrate Solutions Summary
Carbohydrate Solutions segment operating profit was
For the first half of 2024, Carbohydrate Solutions segment operating profit of
2Q 2024 Carbohydrate Solutions Overview
($ in millions, except where noted) |
2Q 2024 |
2Q 2023 |
% Change |
Segment Operating Profit |
|
|
12% |
Starches and Sweeteners |
323 |
301 |
7% |
|
34 |
18 |
89% |
|
|
|
|
1H 2024 Carbohydrate Solutions Overview
($ in millions, except where noted) |
1H 2024 |
1H 2023 |
% Change |
Segment Operating Profit |
|
|
1% |
Starches and Sweeteners |
584 |
614 |
(5)% |
|
21 |
(16) |
231% |
|
|
|
|
Nutrition Summary
Nutrition segment operating profit was
For the first half of 2024, Nutrition segment operating profit of
2Q 2024 Nutrition Overview
($ in millions, except where noted) |
2Q 2024 |
2Q 2023 |
% Change |
Segment Operating Profit |
|
|
(36)% |
Human Nutrition |
103 |
185 |
(44)% |
Animal Nutrition |
6 |
(16) |
138% |
|
|
|
|
1H 2024 Nutrition Overview
($ in millions, except where noted) |
1H 2024 |
1H 2023 |
% Change |
Segment Operating Profit |
|
|
(37)% |
Human Nutrition |
179 |
323 |
(45)% |
Animal Nutrition |
14 |
(16) |
188% |
|
|
|
|
|
|
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Other and Corporate Summary
For the second quarter and first half, Other segment operating profit was
In Corporate for the second quarter, unallocated corporate costs increased on higher global technology investments to support digital transformation efforts, increased legal fees, and increased securitization fees. Other Corporate was favorable compared to the prior year period resulting from foreign currency hedges.
In Corporate for the first half, unallocated corporate costs increased versus the prior year on higher global technology investments to support digital transformation efforts, increased legal fees, and increased securitization fees. Other Corporate was unfavorable compared to the prior year period due to investment valuation losses of approximately
Outlook
The company affirms its previously provided EPS guidance for the full year.
______________________________________
2
Forecasted GAAP Earnings Reconciliation:
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Conference Call Information
About
Cautionary Note Regarding Forward-Looking Statements
This press release contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995 that involve substantial risks and uncertainties. All statements, other than statements of historical fact included in this release, are forward-looking statements. You can identify forward-looking statements by the fact they do not relate strictly to historical or current facts. These statements may include words such as “anticipate,” “estimate,” “expect,” “project,” “plan,” “intend,” “believe,” “may,” “outlook,” “will,” “should,” “can have,” “likely,” and other words and terms of similar meaning in connection with any discussion of the timing or nature of future operating or financial performance or other events. All forward-looking statements are subject to significant risks, uncertainties and changes in circumstances that could cause actual results and outcomes to differ materially from the forward-looking statements. These forward-looking statements are not guarantees of future performance and involve risks, assumptions and uncertainties, including, without limitation, those that are described in the Company’s most recent Annual Report on Form 10-K and in other documents that the Company files or furnishes with the
Non-GAAP Financial Measures
The Company uses certain “Non-GAAP” financial measures as defined by the
Adjusted net earnings and Adjusted earnings per share (EPS). Adjusted net earnings reflects ADM’s reported net earnings after removal of the effect on net earnings of specified items as more fully described in the reconciliation tables below. Adjusted EPS reflects ADM’s fully diluted EPS after removal of the effect on EPS as reported of specified items as more fully described in the reconciliation tables below. Management believes that Adjusted net earnings and Adjusted EPS are useful measures of ADM’s performance because they provide investors additional information about ADM’s operations allowing better evaluation of underlying business performance and better period-to-period comparability. These non-GAAP financial measures are not intended to replace or be alternatives to net earnings and EPS as reported, the most directly comparable GAAP financial measures, or any other measures of operating results under GAAP. Earnings amounts described above have been divided by the company’s diluted shares outstanding for each respective period in order to arrive at an adjusted EPS amount for each specified item.
Segment operating profit and adjusted segment operating profit. Segment operating profit is ADM’s consolidated income from operations before income tax excluding corporate items. Adjusted segment operating profit is segment operating profit excluding specified items as more fully described in the reconciliation tables below. Management believes that segment operating profit and adjusted segment operating profit are useful measures of ADM’s performance because they provide investors information about ADM’s business unit performance excluding corporate overhead costs as well as specified items. Segment operating profit and adjusted segment operating profit are not measures of consolidated operating results under
Adjusted Return on
Financial Tables Follow
Source: Corporate Release
Source:
Segment Operating Profit, Adjusted Segment Operating Profit (both non-GAAP financial measures) and Corporate Results (unaudited) |
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Quarter ended |
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Six months ended |
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(In millions) |
|
2024 |
|
|
2023 |
|
Change |
|
|
2024 |
|
|
2023 |
|
Change |
||||
|
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|
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|
||||||||||||
Earnings before income taxes |
$ |
596 |
|
$ |
1,132 |
|
$ |
(536 |
) |
|
$ |
1,481 |
|
$ |
2,529 |
|
$ |
(1,048 |
) |
Corporate Unallocated |
|
418 |
|
|
393 |
|
|
25 |
|
|
|
844 |
|
|
715 |
|
|
129 |
|
Segment Operating Profit |
$ |
1,014 |
|
$ |
1,525 |
|
$ |
(511 |
) |
|
$ |
2,325 |
|
$ |
3,244 |
|
$ |
(919 |
) |
Specified items: |
|
|
|
|
|
|
|
||||||||||||
(Gain) loss on sales of assets |
|
— |
|
|
(11 |
) |
|
11 |
|
|
|
— |
|
|
(12 |
) |
|
12 |
|
Impairment, restructuring charges and contingency provisions |
|
7 |
|
|
114 |
|
|
(107 |
) |
|
|
13 |
|
|
121 |
|
|
(108 |
) |
Adjusted Segment Operating Profit |
$ |
1,021 |
|
$ |
1,628 |
|
$ |
(607 |
) |
|
$ |
2,338 |
|
$ |
3,353 |
|
$ |
(1,015 |
) |
|
|
|
|
|
|
|
|
||||||||||||
Segment Operating Profit: |
|
|
|
|
|
|
|
||||||||||||
Ag Services and Oilseeds |
$ |
459 |
|
$ |
1,054 |
|
$ |
(595 |
) |
|
$ |
1,323 |
|
$ |
2,265 |
|
$ |
(942 |
) |
Ag Services |
|
122 |
|
|
380 |
|
|
(258 |
) |
|
|
354 |
|
|
728 |
|
|
(374 |
) |
Crushing |
|
132 |
|
|
224 |
|
|
(92 |
) |
|
|
445 |
|
|
651 |
|
|
(206 |
) |
Refined Products and Other |
|
137 |
|
|
362 |
|
|
(225 |
) |
|
|
307 |
|
|
689 |
|
|
(382 |
) |
Wilmar |
|
68 |
|
|
88 |
|
|
(20 |
) |
|
|
217 |
|
|
197 |
|
|
20 |
|
|
|
|
|
|
|
|
|
||||||||||||
Carbohydrate Solutions |
$ |
357 |
|
$ |
319 |
|
$ |
38 |
|
|
$ |
605 |
|
$ |
598 |
|
$ |
7 |
|
Starches and Sweeteners |
|
323 |
|
|
301 |
|
|
22 |
|
|
|
584 |
|
|
614 |
|
|
(30 |
) |
|
|
34 |
|
|
18 |
|
|
16 |
|
|
|
21 |
|
|
(16 |
) |
|
37 |
|
|
|
|
|
|
|
|
|
||||||||||||
Nutrition |
$ |
109 |
|
$ |
169 |
|
$ |
(60 |
) |
|
$ |
193 |
|
$ |
307 |
|
$ |
(114 |
) |
Human Nutrition |
|
103 |
|
|
185 |
|
|
(82 |
) |
|
|
179 |
|
|
323 |
|
|
(144 |
) |
Animal Nutrition |
|
6 |
|
|
(16 |
) |
|
22 |
|
|
|
14 |
|
|
(16 |
) |
|
30 |
|
|
|
|
|
|
|
|
|
||||||||||||
Other Business |
$ |
96 |
|
$ |
86 |
|
$ |
10 |
|
|
$ |
217 |
|
$ |
183 |
|
$ |
34 |
|
|
|
|
|
|
|
|
|
||||||||||||
|
|
|
|
|
|
|
|
||||||||||||
|
|
|
|
|
|
|
|
||||||||||||
Corporate Results |
$ |
(418 |
) |
$ |
(393 |
) |
$ |
(25 |
) |
|
$ |
(844 |
) |
$ |
(715 |
) |
$ |
(129 |
) |
|
|
|
|
|
|
|
|
||||||||||||
Interest expense - net |
|
(128 |
) |
|
(125 |
) |
|
(3 |
) |
|
|
(238 |
) |
|
(228 |
) |
|
(10 |
) |
Unallocated corporate costs |
|
(292 |
) |
|
(262 |
) |
|
(30 |
) |
|
|
(596 |
) |
|
(510 |
) |
|
(86 |
) |
Other |
|
6 |
|
|
(1 |
) |
|
7 |
|
|
|
6 |
|
|
23 |
|
|
(17 |
) |
Specified items: |
|
|
|
|
|
|
|
||||||||||||
Gain (loss) on debt conversion option |
|
— |
|
|
1 |
|
|
(1 |
) |
|
|
— |
|
|
6 |
|
|
(6 |
) |
Expenses related to acquisitions |
|
(4 |
) |
|
(3 |
) |
|
(1 |
) |
|
|
(4 |
) |
|
(3 |
) |
|
(1 |
) |
Restructuring charges |
|
— |
|
|
(3 |
) |
|
3 |
|
|
|
(12 |
) |
|
(3 |
) |
|
(9 |
) |
Segment operating profit, a non-GAAP financial measure, is ADM’s consolidated income from operations before income tax excluding corporate items. Adjusted segment operating profit, a non-GAAP financial measure, is segment operating profit excluding specified items. Management believes that segment operating profit and adjusted segment operating profit are useful measures of ADM’s performance because they provide investors information about ADM’s business unit performance excluding corporate overhead costs as well as specified items. Segment operating profit and adjusted segment operating profit are not measures of consolidated operating results under |
Consolidated Statements of Earnings (unaudited) |
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Quarter ended |
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Six months ended |
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|
||||||||||||
|
|
2024 |
|
|
|
2023 |
|
|
|
2024 |
|
|
|
2023 |
|
|
(in millions, except per share amounts) |
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|
|
|
|
|
|
|
|
||||||||
Revenues |
$ |
22,248 |
|
|
$ |
25,190 |
|
|
$ |
44,095 |
|
|
$ |
49,262 |
|
Cost of products sold (1) |
|
20,852 |
|
|
|
23,307 |
|
|
|
41,040 |
|
|
|
45,299 |
|
Gross profit |
|
1,396 |
|
|
|
1,883 |
|
|
|
3,055 |
|
|
|
3,963 |
|
Selling, general, and administrative expenses (2) |
|
907 |
|
|
|
841 |
|
|
|
1,858 |
|
|
|
1,722 |
|
Asset impairment, exit, and restructuring costs |
|
7 |
|
|
|
60 |
|
|
|
25 |
|
|
|
67 |
|
Equity in (earnings) losses of unconsolidated affiliates |
|
(152 |
) |
|
|
(151 |
) |
|
|
(364 |
) |
|
|
(325 |
) |
Interest and investment income |
|
(140 |
) |
|
|
(142 |
) |
|
|
(263 |
) |
|
|
(276 |
) |
Interest expense (3) |
|
187 |
|
|
|
180 |
|
|
|
353 |
|
|
|
327 |
|
Other (income) expense - net (4) |
|
(9 |
) |
|
|
(37 |
) |
|
|
(35 |
) |
|
|
(81 |
) |
Earnings before income taxes |
|
596 |
|
|
|
1,132 |
|
|
|
1,481 |
|
|
|
2,529 |
|
Income tax expense (benefit) (5) |
|
115 |
|
|
|
204 |
|
|
|
281 |
|
|
|
429 |
|
Net earnings including noncontrolling interests |
|
481 |
|
|
|
928 |
|
|
|
1,200 |
|
|
|
2,100 |
|
|
|
|
|
|
|
|
|
||||||||
Less: Net earnings (losses) attributable to noncontrolling interests |
|
(5 |
) |
|
|
1 |
|
|
|
(15 |
) |
|
|
3 |
|
Net earnings attributable to |
$ |
486 |
|
|
$ |
927 |
|
|
$ |
1,215 |
|
|
$ |
2,097 |
|
|
|
|
|
|
|
|
|
||||||||
Diluted earnings per common share |
$ |
0.98 |
|
|
$ |
1.70 |
|
|
$ |
2.41 |
|
|
$ |
3.82 |
|
|
|
|
|
|
|
|
|
||||||||
Average diluted shares outstanding |
|
493 |
|
|
|
546 |
|
|
|
503 |
|
|
|
549 |
|
|
|
|
|
|
|
|
|
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(1) Includes a contingency loss provision of |
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(2) Includes acquisition-related expenses of |
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(3) Includes (gains) losses related to the mark-to-market adjustment of the conversion option of the exchangeable bond issued in |
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(4) Includes net (gains) losses related to the sale of certain assets of |
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(5) Includes the tax expense impact of specified items and tax discrete items totaling |
Summary of Financial Condition (unaudited) |
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|
|
|
|
|
||
|
|
(in millions) |
||||
Net Investment In |
|
|
|
|
||
Cash and cash equivalents |
|
$ |
764 |
|
$ |
1,426 |
Operating working capital |
|
|
9,827 |
|
|
10,898 |
Property, plant, and equipment |
|
|
10,628 |
|
|
10,127 |
Investments in affiliates |
|
|
5,557 |
|
|
5,665 |
|
|
|
6,970 |
|
|
6,542 |
Other non-current assets |
|
|
2,581 |
|
|
2,479 |
|
|
$ |
36,327 |
|
$ |
37,137 |
Financed By |
|
|
|
|
||
Short-term debt |
|
$ |
2,312 |
|
$ |
125 |
Long-term debt, including current maturities |
|
|
8,248 |
|
|
8,545 |
Deferred liabilities |
|
|
3,306 |
|
|
3,188 |
Temporary equity |
|
|
302 |
|
|
304 |
Shareholders’ equity |
|
|
22,159 |
|
|
24,975 |
|
|
$ |
36,327 |
|
$ |
37,137 |
Summary of Cash Flows (unaudited) |
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|
|
Six months ended |
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|
|
|
||||||
|
|
|
2024 |
|
|
|
2023 |
|
|
|
(in millions) |
||||||
Operating Activities |
|
|
|
|
||||
Net earnings |
|
$ |
1,200 |
|
|
$ |
2,100 |
|
Depreciation and amortization |
|
|
566 |
|
|
|
521 |
|
Asset impairment charges |
|
|
10 |
|
|
|
46 |
|
(Gains) losses on sales/revaluation of assets |
|
|
9 |
|
|
|
(32 |
) |
Other - net |
|
|
(93 |
) |
|
|
(145 |
) |
Other changes in operating assets and liabilities |
|
|
(524 |
) |
|
|
(1,591 |
) |
Total Operating Activities |
|
|
1,168 |
|
|
|
899 |
|
|
|
|
|
|
||||
Investing Activities |
|
|
|
|
||||
Purchases of property, plant and equipment |
|
|
(690 |
) |
|
|
(614 |
) |
Net assets of businesses acquired |
|
|
(936 |
) |
|
|
— |
|
Proceeds from sale of business/assets |
|
|
16 |
|
|
|
17 |
|
Investments in affiliates |
|
|
(8 |
) |
|
|
(6 |
) |
Other investing activities |
|
|
6 |
|
|
|
(8 |
) |
Total Investing Activities |
|
|
(1,612 |
) |
|
|
(611 |
) |
|
|
|
|
|
||||
Financing Activities |
|
|
|
|
||||
Long-term debt borrowings |
|
|
— |
|
|
|
500 |
|
Long-term debt payments |
|
|
— |
|
|
|
(662 |
) |
Net borrowings (payments) under lines of credit |
|
|
2,208 |
|
|
|
(371 |
) |
Share repurchases |
|
|
(2,327 |
) |
|
|
(1,001 |
) |
Cash dividends |
|
|
(503 |
) |
|
|
(494 |
) |
Other |
|
|
(39 |
) |
|
|
(103 |
) |
Total Financing Activities |
|
|
(661 |
) |
|
|
(2,131 |
) |
Effect of exchange rate on cash, cash equivalents, restricted cash, and restricted cash equivalents |
|
|
(14 |
) |
|
|
(3 |
) |
Increase (decrease) in cash, cash equivalents, restricted cash, and restricted cash equivalents |
|
|
(1,119 |
) |
|
|
(1,846 |
) |
Cash, cash equivalents, restricted cash, and restricted cash equivalents - beginning of period |
|
|
5,390 |
|
|
|
7,033 |
|
Cash, cash equivalents, restricted cash, and restricted cash equivalents - end of period |
|
$ |
4,271 |
|
|
$ |
5,187 |
|
Segment Operating Analysis (unaudited) |
|||||||||||
|
Quarter ended |
|
Six months ended |
||||||||
|
|
|
|
||||||||
|
2024 |
|
2023 |
|
2024 |
|
2023 |
||||
|
(in ‘000s metric tons) |
||||||||||
Processed volumes (by commodity) |
|
|
|
|
|
|
|
||||
Oilseeds |
|
8,872 |
|
|
8,783 |
|
|
18,259 |
|
|
17,410 |
Corn |
|
4,482 |
|
|
4,448 |
|
|
8,890 |
|
|
8,842 |
Total processed volumes |
|
13,354 |
|
|
13,231 |
|
|
27,149 |
|
|
26,252 |
|
|
|
|
|
|
|
|
||||
|
|
|
|
|
|
|
|
||||
|
Quarter ended |
|
Six months ended |
||||||||
|
|
|
|
||||||||
|
2024 |
|
2023 |
|
2024 |
|
2023 |
||||
|
(in millions) |
||||||||||
Revenues |
|
|
|
|
|
|
|
||||
Ag Services and Oilseeds |
$ |
17,333 |
|
$ |
19,844 |
|
$ |
34,552 |
|
$ |
38,423 |
Carbohydrate Solutions |
|
2,894 |
|
|
3,381 |
|
|
5,577 |
|
|
6,918 |
Nutrition |
|
1,908 |
|
|
1,853 |
|
|
3,744 |
|
|
3,706 |
Other Business |
|
113 |
|
|
112 |
|
|
222 |
|
|
215 |
Total revenues |
$ |
22,248 |
|
$ |
25,190 |
|
$ |
44,095 |
|
$ |
49,262 |
Adjusted Earnings Per Share
|
|||||||||||||||||||||
|
Quarter ended |
|
Six months ended |
||||||||||||||||||
|
2024 |
2023 |
|
2024 |
2023 |
||||||||||||||||
|
In millions |
Per share |
In millions |
Per share |
|
In millions |
Per share |
In millions |
Per share |
||||||||||||
Net earnings and fully diluted EPS |
$ |
486 |
$ |
0.98 |
$ |
927 |
|
$ |
1.70 |
|
|
$ |
1,215 |
$ |
2.41 |
$ |
2,097 |
|
$ |
3.82 |
|
Adjustments: |
|
|
|
|
|
|
|
|
|
||||||||||||
Loss (gain) on sales of assets and businesses (a) |
|
— |
|
— |
|
(8 |
) |
|
(0.02 |
) |
|
|
— |
|
— |
|
(9 |
) |
|
(0.02 |
) |
Impairment, restructuring charges and contingency provisions (b) |
|
5 |
|
0.01 |
|
93 |
|
|
0.17 |
|
|
|
23 |
|
0.04 |
|
98 |
|
|
0.18 |
|
Expenses related to acquisitions (c) |
|
3 |
|
0.01 |
|
2 |
|
|
— |
|
|
|
3 |
|
0.01 |
|
2 |
|
|
— |
|
Loss (gain) on debt conversion option (d) |
|
— |
|
— |
|
(1 |
) |
|
— |
|
|
|
— |
|
— |
|
(6 |
) |
|
(0.01 |
) |
Tax adjustment (e) |
|
14 |
|
0.03 |
|
21 |
|
|
0.04 |
|
|
|
17 |
|
0.03 |
|
3 |
|
|
0.01 |
|
Sub-total adjustments |
|
22 |
|
0.05 |
|
107 |
|
|
0.19 |
|
|
|
43 |
|
0.08 |
|
88 |
|
|
0.16 |
|
Adjusted net earnings and adjusted EPS |
$ |
508 |
$ |
1.03 |
$ |
1,034 |
|
$ |
1.89 |
|
|
$ |
1,258 |
$ |
2.49 |
$ |
2,185 |
|
$ |
3.98 |
|
(a) |
|
Prior quarter and YTD gain of |
(b) |
Current quarter and YTD charges of |
|
(c) |
Current quarter and YTD expenses of |
|
(d) |
Prior quarter and YTD gain on debt conversion option of |
|
(e) |
Tax expense (benefit) adjustment due to certain discrete items totaling |
|
|
||
Adjusted net earnings reflects ADM’s reported net earnings after removal of the effect on net earnings of specified items as more fully described above. Adjusted EPS reflects ADM’s fully diluted EPS after removal of the effect on EPS as reported of specified items as more fully described above. Management believes that Adjusted net earnings and Adjusted EPS are useful measures of ADM’s performance because they provide investors additional information about ADM’s operations allowing better evaluation of underlying business performance and better period-to-period comparability. These non-GAAP financial measures are not intended to replace or be alternatives to net earnings and EPS as reported, the most directly comparable GAAP financial measures, or any other measures of operating results under GAAP. Earnings amounts described above have been divided by the company’s diluted shares outstanding for each respective period in order to arrive at an adjusted EPS amount for each specified item. |
Return on A non-GAAP financial measure (unaudited) |
|||||||||||||||||||
ROIC Earnings (in millions) |
|
|
|
|
|
|
|
|
|||||||||||
|
|
|
|
|
|
|
|
Four Quarters |
|||||||||||
|
Quarter Ended |
|
Ended |
||||||||||||||||
|
|
|
|
|
|
|
|
|
|
||||||||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Net earnings attributable to |
$ |
821 |
|
|
$ |
565 |
|
|
$ |
729 |
|
|
$ |
486 |
|
|
$ |
2,601 |
|
Adjustments: |
|
|
|
|
|
|
|
|
|
||||||||||
Interest expense |
|
97 |
|
|
|
109 |
|
|
|
115 |
|
|
|
135 |
|
|
|
456 |
|
Tax on interest |
|
(23 |
) |
|
|
(26 |
) |
|
|
(27 |
) |
|
|
(32 |
) |
|
|
(108 |
) |
Total ROIC Earnings |
$ |
895 |
|
|
$ |
648 |
|
|
$ |
817 |
|
|
$ |
589 |
|
|
$ |
2,949 |
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Total ROIC Earnings |
$ |
895 |
|
|
$ |
648 |
|
|
$ |
817 |
|
|
$ |
589 |
|
|
$ |
2,949 |
|
Other Adjustments |
|
59 |
|
|
|
155 |
|
|
|
21 |
|
|
|
22 |
|
|
|
257 |
|
Total Adjusted ROIC Earnings |
$ |
954 |
|
|
$ |
803 |
|
|
$ |
838 |
|
|
$ |
611 |
|
|
$ |
3,206 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
|
|
|
|
|
|
|
|
|
|||||||
|
Quarter Ended |
|
Trailing Four |
||||||||||||
|
|
|
|
|
|
|
|
|
Quarter Average |
||||||
|
|
|
|
|
|
|
|
|
|
||||||
Equity (1) |
$ |
25,228 |
|
$ |
24,132 |
|
$ |
23,219 |
|
$ |
22,148 |
|
$ |
23,682 |
|
+ Interest-bearing liabilities (2) |
|
8,346 |
|
|
8,370 |
|
|
9,995 |
|
|
10,576 |
|
|
9,322 |
|
|
$ |
33,574 |
|
$ |
32,502 |
|
$ |
33,214 |
|
$ |
32,724 |
|
$ |
33,004 |
|
|
|
|
|
|
|
|
|
|
|
||||||
|
$ |
33,574 |
|
$ |
32,502 |
|
$ |
33,214 |
|
$ |
32,724 |
|
$ |
33,004 |
|
Other Adjustments |
|
59 |
|
|
155 |
|
|
21 |
|
|
22 |
|
|
64 |
|
|
$ |
33,633 |
|
$ |
32,657 |
|
$ |
33,235 |
|
$ |
32,746 |
|
$ |
33,068 |
|
|
|
|
|
|
|
|
|
|
|
||||||
Return on |
|
|
|
|
|
|
|
|
8.9 |
% |
|||||
Adjusted Return on |
|
|
|
|
|
|
|
|
9.7 |
% |
|||||
(1) Excludes noncontrolling interests |
|||||||||||||||
(2) Includes short-term debt, current maturities of long-term debt, finance lease obligations, and long-term debt |
|||||||||||||||
ROIC is ROIC earnings divided by invested capital. ROIC earnings is ADM’s net earnings adjusted for the after-tax effects of interest expense on borrowings. Invested capital is the sum of ADM’s equity (excluding noncontrolling interests) and interest-bearing liabilities. |
|||||||||||||||
Adjusted ROIC is Adjusted ROIC earnings divided by adjusted invested capital. Adjusted ROIC earnings is ADM’s net earnings adjusted for the after-tax effects of interest expense on borrowings, and specified items. Adjusted invested capital is the sum of ADM’s equity (excluding noncontrolling interests) and interest-bearing liabilities adjusted for the after-tax effect of specified items. Adjusted ROIC on a trailing four quarter average basis is equal to the average trailing four quarters of adjusted ROIC earnings divided by the average trailing four quarters of adjusted invested capital. Management believes Adjusted ROIC is a useful financial measure because it provides investors information about ADM’s returns excluding the impacts of specified items and increases period-to-period comparability of underlying business performance. Management uses Adjusted ROIC to measure ADM’s performance by comparing Adjusted ROIC to its weighted average cost of capital (WACC). Adjusted ROIC, Adjusted ROIC earnings and Adjusted invested capital are non-GAAP financial measures and are not intended to replace or be alternatives to GAAP financial measures. |
Adjusted Earnings Before Interest, Taxes, and Depreciation and Amortization (EBITDA)
|
||||||||||||||||||
The tables below provide a reconciliation of net earnings to adjusted EBITDA for the trailing four quarters ended |
||||||||||||||||||
|
|
|
|
|
|
|
|
|
Four Quarters |
|||||||||
|
Quarter Ended |
|
Ended |
|||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||
|
|
|
|
|
(in millions) |
|
|
|
|
|||||||||
Net earnings |
$ |
821 |
|
$ |
565 |
|
|
$ |
729 |
|
|
$ |
486 |
|
|
$ |
2,601 |
|
Net earnings (losses) attributable to noncontrolling interests |
|
3 |
|
|
(23 |
) |
|
|
(10 |
) |
|
|
(5 |
) |
|
|
(35 |
) |
Income tax expense |
|
207 |
|
|
192 |
|
|
|
166 |
|
|
|
115 |
|
|
|
680 |
|
Interest expense |
|
97 |
|
|
109 |
|
|
|
115 |
|
|
|
135 |
|
|
|
456 |
|
Depreciation and amortization |
|
261 |
|
|
277 |
|
|
|
280 |
|
|
|
286 |
|
|
|
1,104 |
|
EBITDA |
|
1,389 |
|
|
1,120 |
|
|
|
1,280 |
|
|
|
1,017 |
|
|
|
4,806 |
|
(Gain) loss on sales of assets and businesses |
|
2 |
|
|
(7 |
) |
|
|
— |
|
|
|
— |
|
|
|
(5 |
) |
Impairment and restructuring charges and contingency provisions. |
|
71 |
|
|
172 |
|
|
|
18 |
|
|
|
7 |
|
|
|
268 |
|
Railroad maintenance expense |
|
26 |
|
|
39 |
|
|
|
— |
|
|
|
4 |
|
|
|
69 |
|
Expenses related to acquisitions |
|
3 |
|
|
1 |
|
|
|
— |
|
|
|
4 |
|
|
|
8 |
|
Adjusted EBITDA |
$ |
1,491 |
|
$ |
1,325 |
|
|
$ |
1,298 |
|
|
$ |
1,032 |
|
|
$ |
5,146 |
|
|
|
|
|
|
|
|
|
|
|
|||||||||
EBITDA is defined as earnings before interest, taxes, depreciation and amortization. Adjusted EBITDA is defined as EBITDA, adjusted for specified items. The Company calculates adjusted EBITDA by removing the impact of specified items and adding back the amounts of income tax expense, interest expense on borrowings, and depreciation and amortization to net earnings. Management believes that EBITDA and adjusted EBITDA are useful measures of the Company’s performance because they provide investors additional information about the Company’s operations allowing better evaluation of underlying business performance and better period-to-period comparability. EBITDA and adjusted EBITDA are non-GAAP financial measure and are not intended to replace or be an alternative to net earnings, the most directly comparable GAAP financial measure. |
View source version on businesswire.com: https://www.businesswire.com/news/home/20240730432957/en/
Media Contact
media@adm.com
312-634-8484
Investor Relations
Megan.Britt@adm.com
872-257-8378
Source: