Cargill’s Q1 earnings fall 10% in mixed results

Net earnings at agriculture giant Cargill fell 10% in the first quarter of its financial year as the company posted a mixed set of results on Thursday, with better-than-expected demand for animal feed offsetting the effects of the US-China trade war and bad weather.

Revenues in the three months to August 31 were up 1% to $29 billion, while adjusted operational profits grew 3% to $908 million compared with the same quarter last year.

But net profit was down 10% at $915 million, although the company attributed this slide to the strength of last year's performance.

“Disruptions and uncertainty in the global business environment continued to present challenges during the quarter,” chairman and chief executive officer Dave MacLennan said in a statement.

Earnings rose in its Industrial and Financial Services and Animal Nutrition and Protein segments, with the latter bucking expectations it could suffer from reduced demand for animal nutrition.

“Despite pressure from African swine fever, results improved in global compound feeds,” a company statement said, with strong demand for beef and eggs in North America and poultry in Europe and Asia.

However, operational earnings declined in its Origination and Processing businesses, with the company pointing to the US-China trade war and bad weather, although its global trading business “saw good year-on-year improvement".