2014

Monsanto Company's Global Business Performance Drives Increased Full-Year Earnings Outlook Full-Year Ongoing Earnings Per Share Guidance Raised to $4.40 to $4.50, or $4.42 to $4.52 As-Reported

ST. LOUIS, April 3, 2013 /PRNewswire/ -- With half of its fiscal year complete, Monsanto Company (NYSE: MON) announced today that the continued strength of its growing global business delivered another strong quarter for its fiscal year 2013 and translated to a second consecutive quarterly increase in full-year ongoing and as-reported earnings per share guidance. In reporting earnings results for the second quarter and first half of the year, executives noted results were driven by contributions from across the company's business portfolio, including continued growth of its global corn business and positive performance of its agricultural productivity segment.



Second Quarter


Six Months

($ in millions)


2013


2012


2013


2012

Net Sales By Segment









Corn seed and traits


$

3,280



$

2,816



$

4,419



$

3,711


Soybean seed and traits


677



689



908



931


Vegetable seeds


199



215



355



372


Cotton seed and traits


60



66



245



260


All other crops seeds and traits


130



138



174



184


TOTAL Seeds and Genomics


$

4,346



$

3,924



$

6,101



$

5,458











Agricultural productivity


$

1,126



$

824



$

2,310



$

1,729


TOTAL Agricultural Productivity


$

1,126



$

824



$

2,310



$

1,729











TOTAL Net Sales


$

5,472



$

4,748



$

8,411



$

7,187











Gross Profit


$

3,070



$

2,705



$

4,467



$

3,801











Operating Expenses


$

958



$

896



$

1,846



$

1,747


Interest Expense – Net


$

8



$

27



$

36



$

62


Other Expense – Net


$

22



$

37



$

39



$

43


Net Income Attributable to Monsanto Company


$

1,483



$

1,211



$

1,822



$

1,337











Diluted Earnings per Share (See note 1.)


$

2.74



$

2.24



$

3.37



$

2.47


Items Affecting Comparability – EPS Impact









Income on discontinued operations


(0.01)



(0.01)



(0.02)



(0.01)


Nitro Claims Settlement




0.05





0.05


Diluted Earnings per Share from Ongoing Business (For the

definition of ongoing EPS, see note 1.)


$

2.73



$

2.28



$

3.35



$

2.51


Effective Tax Rate


29

%


31

%


28

%


31

%

 




Second Quarter


Six Months

Comparison as a Percent of Net Sales:


2013


2012


2013


2012


Gross profit


56

%


57

%


53

%


53

%


Selling, general and administrative expenses


11

%


11

%


14

%


15

%


Research and development expenses


7

%


7

%


8

%


10

%


Income from continuing operations before income taxes


38

%


37

%


30

%


27

%


Net income attributable to Monsanto Company


27

%


26

%


22

%


19

%

 

"Our commitment to serving our farmer customers around the world is at the core of everything we do," said Hugh Grant, chairman and chief executive officer for Monsanto. "By understanding their needs and finding new ways to work with them to meet growing demand, we've achieved momentum in our business and strong results across our global portfolio. Our performance underscores our expectation for a third consecutive year of strong earnings growth and reinforces our opportunities for the future as well. As we move into the second half of the year, we are thankful for the opportunity to serve our customers and continue to earn their business as a leader in this dynamic industry."

Results of Operations

The company achieved strong second quarter and first half results that reflect the continued growth of its global business. Net sales for the quarter increased $724 million or 15 percent to $5.5 billion in the three-month comparison driven in part by 16 percent sales growth from its global corn business. For the first six months, net sales increased $1.2 billion or 17 percent.

Operating expenses were up $62 million in the second quarter compared to the prior year. In the three-month comparison, selling, general and administrative (SG&A) expenses increased 10 percent to $598 million.  Quarterly research and development (R&D) expenses were up 2 percent to $360 million compared to the prior year period.

The company's second quarter earnings per share (EPS) was $2.73 on an ongoing and $2.74 on an as-reported basis, compared to an EPS of $2.28 on an ongoing and $2.24 on an as-reported basis in the same quarter last year. EPS for the first six months of fiscal year 2013 was $3.35 on an ongoing and $3.37 on an as-reported basis. (For a reconciliation of EPS to ongoing EPS see page 1).

Cash Flow

For the first half of fiscal year 2013, cash flow from operations was a source of nearly $1.9 billion compared to $1.7 billion for the same period last year.

Net cash required by investing activities for the first half of fiscal year 2013 was $301 million, compared to $402 million for the same period of fiscal year 2012. Net cash required by financing activities for the first half of 2013 was $422 million, compared to net cash required of $672 million for the same period of fiscal year 2012. 

Free cash flow was a source of nearly $1.6 billion for the first half of fiscal year 2013, compared to a source of $1.3 billion for the first half of fiscal year 2012. (For a reconciliation of free cash flow, see note 1.)

Outlook

The company raised its full year ongoing EPS guidance to $4.40 to $4.50 per share. Full year 2013 EPS guidance on an as-reported basis is expected in the range of $4.42 to $4.52 per share. (For a reconciliation of EPS, see note 1.)

The company affirmed its previously announced full year free cash flow guidance of $1.8 billion to $2 billion. The company expects net cash provided by operating activities to be $2.9 billion to $3.3 billion, and net cash required by investing activities to be $1.1 billion to $1.3 billion for fiscal year 2013. (For a reconciliation of free cash flow, see note 1.)

Seeds and Genomics Segment Detail

($ in millions)


Net Sales


Gross Profit



Second Quarter


Six Months


Second Quarter


Six Months

Seeds and Genomics


2013


2012


2013


2012


2013


2012


2013


2012

Corn Seed and Traits


$

3,280



$

2,816



$

4,419



$

3,711



$

2,083



$

1,847



$

2,769



$

2,378


Soybean Seed and Traits


677



689



908



931



395



443



513



616


Vegetable Seeds


199



215



355



372



106



85



189



166


Cotton Seed and Traits


60



66



245



260



44



47



171



182


All Other Crops Seeds and Traits


130



138



174



184



71



69



82



65


TOTAL Seeds and Genomics


$

4,346



$

3,924



$

6,101



$

5,458



$

2,699



$

2,491



$

3,724



$

3,407


 

($ in millions)


Earnings Before Interest & Taxes (EBIT)




Second Quarter


Six Months


Seeds and Genomics


2013


2012


2013


2012


EBIT (For a reconciliation of EBIT, see note 1.)


$

1,840



$

1,699



$

2,060



$

1,846





















 

The Seeds and Genomics segment consists of the company's global seeds and related traits business.

Sales in the Seeds and Genomics segment for the second quarter were $4.3 billion, an increase of $422 million over the same period last year.  For the first six months, sales for the segment are up $643 million over the same period last year. 

Monsanto's global corn business led the Seeds and Genomics segment performance, as it expects to hit record total corn volumes in 2013. The second quarter results were driven in part by the conclusion of a successful and record second season in Brazil where the company continued to achieve strong demand for its latest corn products. The U.S. corn business also drove the results for the quarter, with the company projecting another year of strong performance from the business driven by the positive mix improvement across its corn portfolio. The company is on track to reach the high end of its 36 million to 38 million acre target range for its Genuity® reduced refuge family. 

The current and emerging opportunities in the company's global soybean business complement the global corn business. In the United States, the company has achieved strong results year-to-date, with the positive order book and shipments positioning the company well to deliver to the high end of its 39 million to 41 million acre target range for its Genuity® Roundup Ready 2 Yield® platform. This performance comes as the company prepares to enter the next phase of innovation in its soybean platform, including the addition of both Roundup Ready 2 Xtendand Intacta RR2 PROsoybeans. The company noted that new results from its second year of Intacta RR2 PRO Ground Breakers® on-farm field trials in Brazil have demonstrated a better than 4 bushel per acre yield advantage against first-generation Roundup Ready® soybeans at more than 1,000 locations, double the number of locations from its 2012 Ground Breakers® on-farm field trials in Brazil.

Agricultural Productivity Segment Detail

 ($ in millions)


Net Sales 


Gross Profit



Second Quarter


Six Months 


Second Quarter


Six Months



2013


2012


2013


2012


2013


2012


2013


2012

Agricultural Productivity


$

1,126



$

824



$

2,310



$

1,729



$

371



$

214



$

743



$

394


TOTAL Agricultural Productivity


$

1,126



$

824



$

2,310



$

1,729



$

371



$

214



$

743



$

394


 

($ in millions)


Earnings Before Interest & Taxes (EBIT)



Second Quarter


Six Months

Agricultural Productivity


2013


2012


2013


2012

EBIT (For a reconciliation of EBIT, see note 1.)


$

256



$

82



$

526



$

164


Unusual Items Affecting EBIT:









EBIT from Discontinued Operations


$

6



$

11



$

17



$

11


Nitro Claims Settlement


$



$

(44)



$



$

(44)


 

The Agricultural Productivity segment consists of the crop protection products and lawn-and-garden herbicide products.

Net sales in the second quarter of fiscal 2013 for Monsanto's Agricultural Productivity segment increased $302 million over the same period last year, reflecting the continued benefit of a favorable marketplace environment.  The company remains focused on its established Roundup® strategy.

Webcast Information
In conjunction with this announcement, Monsanto will hold a conference call at 8:30 a.m. central time (9:30 a.m. eastern time) today.  The call will focus on these results and future expectations and may include a discussion of Monsanto's strategic initiatives, product performance and other matters related to the company's business.

Presentation slides and a simultaneous audio webcast of the conference call may be accessed by visiting the company's website at www.monsanto.com/investors or by visiting http://edge.media-server.com/m/p/pbzn6osi/lan/en. Visitors may need to download Windows Media Player™ prior to listening to the webcast. Following the live broadcast, a replay of the webcast will be available on the Monsanto website for three weeks. Monsanto publishes details on upcoming webcasts on this website in both the Presentation and Financial Reports section and the Calendar of Events section. Investors should look to this site as the source of information on future investor conference webcasts. The site includes a calendar of upcoming investor events, details on accessing scheduled webcasts and information from previous investor events.

About Monsanto Company
Monsanto Company is a leading global provider of technology-based solutions and agricultural products that improve farm productivity and food quality. Monsanto remains focused on enabling both small-holder and large-scale farmers to produce more from their land while conserving more of our world's natural resources such as water and energy. To learn more about our business and our commitments, please visit: www.monsanto.com.  Follow our business on Twitter® at www.twitter.com/MonsantoCo, on the company blog, Beyond the Rows at www.monsantoblog.com, or subscribe to our News Release RSS Feed.

Cautionary Statements Regarding Forward-Looking Information:

Certain statements contained in this release are "forward-looking statements," such as statements concerning the company's anticipated financial results, current and future product performance, regulatory approvals, business and financial plans and other non-historical facts. These statements are based on current expectations and currently available information. However, since these statements are based on factors that involve risks and uncertainties, the company's actual performance and results may differ materially from those described or implied by such forward-looking statements. Factors that could cause or contribute to such differences include, among others: continued competition in seeds, traits and agricultural chemicals; the company's exposure to various contingencies, including those related to intellectual property protection, regulatory compliance and the speed with which approvals are received, and public acceptance of biotechnology products; the success of the company's research and development activities; the outcomes of major lawsuits and the previously-announced SEC investigation; developments related to foreign currencies and economies; successful operation of recent acquisitions; fluctuations in commodity prices; compliance with regulations affecting our manufacturing; the accuracy of the company's estimates related to distribution inventory levels; the company's ability to fund its short-term financing needs and to obtain payment for the products that it sells; the effect of weather conditions, natural disasters and accidents on the agriculture business or the company's facilities; and other risks and factors detailed in the company's most recent Form 10-K Report to the SEC. Undue reliance should not be placed on these forward-looking statements, which are current only as of the date of this release. The company disclaims any current intention or obligation to update any forward-looking statements or any of the factors that may affect actual results.

Notes to editors: Monsanto and the Vine Design, Genuity, Roundup, Roundup Ready 2 Yield, Roundup Ready 2 Xtend, Intacta RR2 PRO and Ground Breakers are trademarks of Monsanto Company and its wholly-owned subsidiaries.

Monsanto Company
800 North Lindbergh Blvd
St. Louis, Missouri 63167


Contact

Media: Sara Miller (314-694-5824)


Analysts: Bryan Hurley (314-694-8148)

 

Monsanto Company

Selected Financial Information

(Dollars in millions, except per share amounts)

Unaudited


Statements of Consolidated Operations


Three Months Ended


Six Months Ended



February 28, 2013


February 29, 2012


February 28, 2013


February 29, 2012

Net Sales


$

5,472



$

4,748



$

8,411



$

7,187


Cost of Goods Sold


2,402



2,043



3,944



3,386


Gross Profit


3,070



2,705



4,467



3,801


Operating Expenses:









Selling, general and administrative expenses


598



543



1,140



1,043


Research and development expenses


360



353



706



704


Total Operating Expenses


958



896



1,846



1,747


Income From Operations


2,112



1,809



2,621



2,054


Interest Expense


35



47



86



100


Interest Income


(27)



(20)



(50)



(38)


Other Expense, Net


22



37



39



43


Income from Continuing Operations Before Income Taxes


2,082



1,745



2,546



1,949


Income Tax Provision


603



540



725



610


Income from Continuing Operations Including Portion Attributable to Noncontrolling Interest


$

1,479



$

1,205



$

1,821



$

1,339


Discontinued Operations:









Income from Operations of Discontinued Businesses


6



11



17



11


Income Tax Provision


2



4



6



4


Income on Discontinued Operations


4



7



11



7


Net Income


$

1,483



$

1,212



$

1,832



$

1,346


Less: Net Income Attributable to Noncontrolling Interest




1



10



9


Net Income Attributable to Monsanto Company


$

1,483



$

1,211



$

1,822



$

1,337











EBIT (see note 1)


$

2,096



$

1,781



$

2,586



$

2,010











Basic Earnings per Share Attributable to Monsanto Company:









Income from Continuing Operations


$

2.77



$

2.25



$

3.39



$

2.49


Income on Discontinued Operations


0.01



0.02



0.02



0.01


Net Income Attributable to Monsanto Company


$

2.78



$

2.27



$

3.41



$

2.50











Diluted Earnings per Share Attributable to Monsanto Company:









Income from Continuing Operations


$

2.73



$

2.23



$

3.35



$

2.46


Income on Discontinued Operations


0.01



0.01



0.02



0.01


Net Income Attributable to Monsanto Company


$

2.74



$

2.24



$

3.37



$

2.47











Weighted Average Shares Outstanding:









Basic


534.8



534.4



534.8



534.9


Diluted


540.9



540.5



540.9



540.9


 

Monsanto Company

Selected Financial Information

(Dollars in millions, except per share amounts)

Unaudited


Condensed Statements of Consolidated Financial Position


As of


As of



Feb. 28, 2013


Aug. 31, 2012

Assets





Current Assets:





Cash and cash equivalents (variable interest entity restricted - 2013: $58 and 2012: $120)


$

4,443



$

3,283


Short-term investments


310



302


Trade receivables, net (variable interest entity restricted - 2013: $132 and 2012: $52)


2,219



1,897


Miscellaneous receivables


638



620


Deferred tax assets


658



534


Inventory, net


3,095



2,839


Other current assets


171



183


Total Current Assets


11,534



9,658


Property, Plant and Equipment, Net


4,400



4,365


Goodwill


3,519



3,435


Other Intangible Assets, Net


1,220



1,237


Noncurrent Deferred Tax Assets


542



551


Long-Term Receivables, Net


255



376


Other Assets


609



602


Total Assets


$

22,079



$

20,224


Liabilities and Shareowners' Equity





Current Liabilities:





Short-term debt, including current portion of long-term debt


152



36


Accounts payable


751



794


Income taxes payable


430



75


Accrued compensation and benefits


372



546


Accrued marketing programs


1,020



1,281


Deferred revenues


756



396


Grower production accruals


239



194


Dividends payable


201



200


Customer payable


7



14


Miscellaneous short-term accruals


781



685


Total Current Liabilities


4,709



4,221


Long-Term Debt


2,054



2,038


Postretirement Liabilities


526



543


Long-Term Deferred Revenue


187



245


Noncurrent Deferred Tax Liabilities


410



313


Long-Term Portion of Environmental and Litigation Reserves


217



213


Other Liabilities


518



615


Monsanto Shareowners' Equity


13,240



11,833


Noncontrolling Interest


218



203


Total Shareowners' Equity


13,458



12,036


Total Liabilities and Shareowners' Equity


$

22,079



$

20,224


Debt to Capital Ratio:


14

%


15

%

 

Monsanto Company

Selected Financial Information

(Dollars in millions, except per share amounts)

Unaudited


Statements of Consolidated Cash Flows


Six Months Ended



Feb. 28, 2013


Feb. 29, 2012

Operating Activities:





Net Income


$

1,832



$

1,346


Adjustments to reconcile cash provided by operating activities:





Items that did not require (provide) cash:





Depreciation and amortization


305



311


Bad-debt expense


10



(8)


Stock-based compensation expense


49



72


Excess tax benefits from stock-based compensation


(47)



(26)


Deferred income taxes


52



(33)


Equity affiliate income, net


(2)



(3)


Net gain on sales of a business or other assets


(14)



(2)


Other items


48



65


Changes in assets and liabilities that provided (required) cash, net of acquisitions:





Trade receivables, net


(196)



(265)


Inventory, net


(261)



(356)


Deferred revenues


293



445


Accounts payable and other accrued liabilities


(204)



142


Restructuring cash payments




(7)


Pension contributions


(24)



(33)


Other items


16



24


Net Cash Provided by Operating Activities


1,857



1,672


Cash Flows Provided (Required) by Investing Activities:





Purchases of short-term investments


(320)



(429)


Maturities of short-term investments


312



429


Capital expenditures


(261)



(239)


Acquisitions of businesses, net of cash acquired


(79)



(113)


Technology and other investments


(48)



(56)


Other investments and property disposal proceeds


95



6


Net Cash Required by Investing Activities


(301)



(402)


Cash Flows Provided (Required) by Financing Activities:





Net change in financing with less than 90-day maturities


142



(8)


Short-term debt proceeds


1



9


Short-term debt reductions


(29)



(17)


Long-term debt proceeds


16




Long-term debt reductions


(2)



(142)


Treasury stock purchases


(327)



(299)


Stock option exercises


136



52


Excess tax benefits from stock-based compensation


47



26


Tax withholding on restricted stock and restricted stock units


(3)



(1)


Dividend payments


(402)



(322)


Dividend payments to noncontrolling interests


(1)



(71)


Proceeds from noncontrolling interests




101


Net Cash Required by Financing Activities


(422)



(672)


Effect of Exchange Rate Changes on Cash and Cash Equivalents


26



(47)


Net Increase in Cash and Cash Equivalents


1,160



551


Cash and Cash Equivalents at Beginning of Period


3,283



2,572


Cash and Cash Equivalents at End of Period


$

4,443



$

3,123


 

Monsanto Company


Selected Financial Information


(Dollars in millions)


Unaudited




1.

EBIT, Ongoing EPS and Free Cash Flow: The presentations of EBIT, ongoing EPS and free cash flow are not intended to replace net income (loss) attributable to Monsanto Company, cash flows, financial position or comprehensive income (loss), and they are not measures of financial performance as determined in accordance with generally accepted accounting principles (GAAP) in the United States. The following tables reconcile EBIT, ongoing EPS and free cash flow to the respective most directly comparable financial measure calculated in accordance with GAAP.




Reconciliation of EBIT to Net Income (Loss): EBIT is defined as earnings (loss) before interest and taxes. Earnings (loss) is intended to mean net income (loss) attributable to Monsanto Company as presented in the Statements of Consolidated Operations under GAAP. The following table reconciles EBIT to the most directly comparable financial measure, which is net income (loss) attributable to Monsanto Company.

 



Three Months Ended


Six Months Ended



Feb. 28, 2013


Feb. 29, 2012


Feb. 28, 2013


Feb. 29, 2012

EBIT – Seeds and Genomics Segment


$

1,840



$

1,699



$

2,060



$

1,846


EBIT – Agricultural Productivity Segment


256



82



526



164


EBIT Total


2,096



1,781



2,586



2,010


Interest Expense, Net


8



27



36



62


Income Tax Provision(A)


605



543



728



611


Net Income Attributable to Monsanto Company


$

1,483



$

1,211



$

1,822



$

1,337


 

(A)

Includes the income tax provision from continuing operations, the income tax benefit (provision) on noncontrolling interest, and the income tax on discontinued operations.



Reconciliation of EPS to Ongoing EPS: Ongoing EPS is calculated excluding certain after-tax items which Monsanto does not consider part of ongoing operations.

 



Fiscal Year

2013

Guidance


Three Months Ended

Feb. 28, 2013


Three Months Ended

Feb. 29, 2012


Six Months Ended

Feb. 28, 2013


Six Months Ended

Feb. 29, 2012

Diluted Earnings per Share


$4.42-$4.52


$

2.74



$

2.24



$

3.37



$

2.47


Income on Discontinued Operations


(0.02)


(0.01)



(0.01)



(0.02)



(0.01)


Nitro Claims Settlement





0.05





0.05


 Diluted Earnings per Share from Ongoing Business


$4.40-$4.50


$

2.73



$

2.28



$

3.35



$

2.51


 

Reconciliation of Free Cash Flow:  Free cash flow represents the total of cash flows from operating activities and investing activities, as reflected in the Statements of Consolidated Cash Flows presented in this release.  With respect to the fiscal year 2013 free cash flow guidance, Monsanto does not include any estimates or projections of Net Cash Provided (Required) by Financing Activities because in order to prepare any such estimate or projection, Monsanto would need to rely on market factors and conditions that are outside of its control.

 



Fiscal Year


Six Months Ended



2013 Guidance


Feb. 28, 2013


Feb. 29, 2012

Net Cash Provided by Operating Activities

$

2,900-3,300


$

1,857



$

1,672


Net Cash Required by Investing Activities


(1,100)-(1,300)


(301)



(402)


Free Cash Flow

$

1,800-2,000


1,556



1,270


Net Cash Required by Financing Activities


N/A


(422)



(672)


Effect of Exchange Rate Changes on Cash and Cash Equivalents


N/A


26



(47)


Net Increase in Cash and Cash Equivalents


N/A


1,160



551


Cash and Cash Equivalents at Beginning of Period


N/A


3,283



2,572


Cash and Cash Equivalents at End of Period


N/A


$

4,443



$

3,123


 

SOURCE Monsanto Company



RELATED LINKS
http://www.monsanto.com

Custom Packages

Browse our custom packages or build your own to meet your unique communications needs.

Start today.

 

PR Newswire Membership

Fill out a PR Newswire membership form or contact us at (888) 776-0942.

Learn about PR Newswire services

Request more information about PR Newswire products and services or call us at (888) 776-0942.