Crop merchant Bunge raises full-year profit outlook

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FILE PHOTO: FILE PHOTO: The sun sets behind grain elevators at the Bunge Grain facility along the Ohio River in Owensboro

By Karl Plume

CHICAGO (Reuters) – Agricultural commodities trader Bunge Ltd on Wednesday raised its full-year earnings outlook after posting an adjusted third-quarter profit that topped expectations, sending its shares up about 2% in premarket trading.

The improved forecast was attributed to favorable market conditions as tight global crop supplies and strong demand have benefited supply chain middlemen like Bunge, which buys and sells crops like soybeans and corn, and processes them into food, feed and biofuel.

Bunge’s earnings provided a glimpse into how grains merchants have weathered soaring crop and energy prices and supply chain disruptions, including export delays at Ukraine’s Black Sea ports following invasion by Russia.

Rival agribusiness Archer-Daniels-Midland Co on Tuesday reported its strongest-ever third-quarter profit and raised its full-year earnings outlook.

Bunge raised its full-year 2022 earnings guidance to $13.50 per share after raising it to $12 a share three months earlier as the profit outlook for its core business segments improved.

Its agribusiness unit posted mixed results in the quarter ended Sept. 30 as sharply higher energy costs in Europe and weaker demand in China due to COVID restrictions offset stronger oilseed processing results in North and South America.

The refined and specialty oils segment of Bunge, however, turned in stronger quarterly earnings on solid refined oils results in the Americas and Europe.

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Net income attributable to Bunge fell to $380 million, or $2.49 cents per share, from $653 million, or $4.28 per share, a year earlier.

Adjusted for one-time items, earnings were $3.45 per share, down from $3.72 a share in the same quarter last year but above the consensus analyst estimate for $2.49.

Revenue rose to $16.759 billion, from $14.117 billion a year ago and topping the consensus outlook for $16.087 billion.

(Additional reporting by Arshreet Singh in Bengaluru; Editing by Bernadette Baum)