Archer Daniels Midland Co. (NYSE:ADM), the world's largest corn processor, said profit dropped 21 percent in the second quarter, amid tight crop supplies in the U.S., and after it set more funds aside to resolve a bribery probe with the U.S. government. The shares dropped in early trading.
Net income for the three months that ended June 30 dropped to $223 million, or 34 cents a share, from $284 million, or 43 cents a share, a year earlier, the Decatur, Illinois-based company said in a statement on Tuesday.
Taking out unusual items, earnings rose to 46 cents a share, from 38 cents a share a year earlier, and above earnings of 44 cents a share predicted by 10 analysts polled by Thomson Reuters I/B/E/S.
Revenue for the April-to-June period dropped to $22.54 billion from $22.68 billion, and below analyst expectations of $22.87 billion.
The company, which has 265 processing plants and 460 crop procurement facilities, said the declines were due to "tight U.S. crop supplies".
ADM also lifted its provision to settle an investigation by the U.S. Department of Justice and the U.S. Securities and Exchange Commission to $54 million from $25 million, according to the statement. The company has been negotiating with the two parties about possible violations of foreign bribery laws since 2008, it said.
The shares snapped a four-day winning streak, falling 0.3 percent to $37.74 at 9:54 a.m. in New York on Tuesday. The stock gained 38 percent this year through Monday.
"We'll be managing through tight crop supplies until the forecast large but delayed U.S. harvest," Chief Executive Officer Patricia Woertz, who assumed the job in 2006, said in the statement.
The 30,000-employee agribusiness firm generates revenue by converting oilseeds, corn, wheat and cocoa into products for food, animal feed, industrial and energy uses.