Reuters – Bunge Ltd. raised profit expectations July 27, although the American firm posted shorter results in the second quarter than were forecast by Wall Street.
While the company’s second-quarter revenue climbed 16.5 per cent to US$17.93 billion, it missed estimates of $18.46 billion.
Bunge raised its full-year profit forecast July 27 and posted a 15 per cent jump in second-quarter 2022 adjusted profit. The global farm commodities merchant had benefited from higher demand and tighter supplies of commodity grain crops.
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Bunge earned $2.97 per share, 36 cents higher than the same quarter last year, but below analyst estimates of $3.26 per share, according to the market analysts at Refinitiv data.
Bunge’s results come at a time when global supply chains have snarled and strong demand for food and fuel have propelled inflation to the highest in decades.
Russia’s invasion of major corn and wheat exporter Ukraine has driven up demand for supply-chain middle actors like Bunge, who ship around the world.
Rival Archer-Daniels-Midland Co. also reported strong earnings July 26.
Transportation and ongoing pandemic-related issues continue to drag on the grain sector overall.
Bunge’s agribusiness unit saw a boost from U.S. and Brazilian soy crush due to strong demand for meal and oil, it said, but its merchandising group was impacted by ocean freight issues, where rates have soared and ports have been jammed.
Its sugar and bioenergy segment enjoyed higher ethanol prices, but that boost was offset by “lower ethanol volumes and increased costs,” Bunge said in a statement.
The company now expects annual adjusted earnings of at least $12 per share, compared with its previous forecast of at least $11.50 per share.
