Monsanto ends year with net income of $2 billion

ST. LOUIS — Monsanto Company announced Oct. 3 it concluded fiscal year 2012 with ongoing earnings per share growth of 25 percent.

Growth in the United States was attributed to the continued adoption of its key corn and soybean platforms.

Corn and beans

Net sales for the full fiscal year were $13.5 billion, a 14 percent increase over fiscal year 2011.

Full year net sales results were driven primarily by higher global corn seeds and traits revenue, and increased soybean seeds and traits revenue in the United States and Brazil.

For the fiscal year, net sales for the seeds and genomics segment reached $9.8 billion.

Net sales for the agricultural productivity segment for the fiscal year grew to $3.7 billion.

Income and earnings

Net income for fiscal year 2012 was $2 billion, an increase over fiscal year 2011 net income of $1.6 billion.

The company’s fiscal year 2012 earnings per share was $3.70 on an ongoing basis and $3.79 on an as-reported basis.

For fiscal year 2012, net cash provided by operating activities was a source of $3 billion, compared with a source of $2.8 billion in fiscal year 2011.

Outlook

In fiscal year 2013, Monsanto expects its seeds and genomics segment to deliver gross profit in the range of $6.55 billion in 2013, with gross profit growth projected to be divided roughly evenly between the United States and international regions.

Gross profit for the agricultural productivity segment next year is expected in the range of $1 billion. The company projects free cash flow in the range of $1.7 billion to $1.8 billion for fiscal year 2013.

The company’s research and development spend is projected in the range of $1.53 billion for fiscal year 2013.

More details

The seeds and genomics segment consists of the company’s global seeds and related traits business. For the fiscal year, Monsanto realized Seeds and Genomics segment sales of $9.8 billion, reflecting a 14 percent increase over the prior year.

In the United States, branded seed volume in fiscal year 2012 grew by the largest increment in three years and outpaced market expansion.

In corn, the company reached 27 million planted U.S. acres for its Genuity Reduced Refuge Family.

In 2013, the company is targeting 36 million to 38 million acres for the Reduced Refuge Family.

Genuity VT Triple PRO RIB Complete, a convenient, single-bag refuge option, will join Genuity SmartStax RIB Complete and Genuity VT Double PRO RIB Complete corn blends as an additional product choice available for the 2013 season.

In soybeans, the company reached a total of 32 million acres for its Genuity Roundup Ready 2 Yield product in the United States. The company expects the Genuity Roundup Ready 2 Yield platform growth to continue, targeting 39 million to 41 million acres in 2013.

South America

In 2013, the company expects Latin America to again be a strong source of growth complementing the U.S. business, driven by the continued corn opportunity in Brazil and Argentina.

In Argentina, the company has introduced Genuity VT Triple PRO corn as another product choice for farmers and expects the acceleration of the conversion of double stacks to the triple-stack product. Similarly, in Brazil, growers choosing to upgrade from single trait corn products to the first double stack, VT PRO! 2, is also expected to accelerate.

Complementing the continued strong adoption of the company’s next-generation soy platform in the United States, the Intacta RR2 PRO! soybean product is expected to be a driver of growth with expanded Ground Breakers! on-farm testing planned for 2013 as the product ramps up for commercial launch in Brazil and is introduced in other countries in coming years.

Vegetable sales, up in the fourth quarter compared to the prior year period, were down year-over-year. In 2013, the company expects the vegetable business to return to growth and continues to anticipate it elevating to its third largest crop platform in terms of gross profit in the coming years.

Cotton revenue decreased year-over-year due in part to acre shifts to other crops.

Crop protection

The agricultural productivity segment consists of the crop protection products and lawn-and-garden herbicide products.

For the fiscal year, the segment delivered net sales of $3.7 billion with gross profit of $986 million, with year-over-year increases that reflect strong performance from the company’s Roundup, lawn-and-garden and selective herbicides businesses.