Bunge Limited (NYSE:BG) today reported third quarter 2021
results
- Q3 GAAP EPS of $4.28 vs. $1.84 in the prior year; $3.72 vs.
$2.47 on an adjusted basis excluding certain gains/charges and
mark-to-market timing differences
- Strong performances across Bunge’s core and non-core
operations
- Agribusiness results driven by strong execution and better
than expected market environment
- Refined and Specialty Oils performance improved in all
regions with particular strength in North America
- Announced actions to further improve business portfolio:
forming renewable fuel feedstocks JV with Chevron and sale of
Mexico wheat mills
- Repurchased $100 million of Bunge common shares completing
existing $500 million authorization; Bunge Board authorized new
$500 million program
- Increasing full-year adjusted EPS outlook to at least $11.50
based on strong Q3 results and favorable market trends
Greg Heckman, Bunge's Chief Executive Officer, commented, “We
delivered a truly exceptional quarter. Our team was nimble,
insightful and proactive, effectively managing supply chains,
capacity and risk. Our global platform has allowed us to serve our
customers - both farmers and end consumers - in today's volatile
environment. At the same time, we remain intensely focused on a
disciplined and balanced approach to allocating capital to maintain
our financial strength, invest in growth opportunities, and return
capital to our shareholders.
“Looking ahead, we expect the favorable market trends to
continue. We are well-positioned to help our customers across the
supply chain address the challenges in meeting increasing consumer
demand for sustainable food, feed and fuel.”
Quarter Ended September
30,
Nine Months Ended September
30,
(US$ in millions, except per share
data)
2021
2020
2021
2020
Net income attributable to
Bunge
$
653
$
262
$
1,847
$
594
Net income per common
share-diluted
$
4.28
$
1.84
$
12.12
$
3.98
Mark-to-market timing difference (a)
$
0.22
$
0.85
$
(0.83
)
$
0.97
Certain (gains) and charges (b)
$
(0.78
)
$
(0.14
)
$
(1.86
)
$
0.32
Adjustment of redeemable noncontrolling
interest (c)
$
—
$
(0.08
)
$
—
$
(0.01
)
Adjusted Net income per common
share-diluted (d)
$
3.72
$
2.47
$
9.43
$
5.26
Core Segment EBIT (d) (e)
$
812
$
419
$
2,464
$
1,312
Mark-to-market timing difference (a)
44
161
(151
)
186
Certain (gains) & charges (b)
(158
)
—
(328
)
—
Adjusted Core Segment EBIT (d)
$
698
$
580
$
1,985
$
1,498
Corporate and Other EBIT (d)
$
(81
)
$
(92
)
$
(227
)
$
(279
)
Certain (gains) & charges (b)
—
—
—
71
Adjusted Corporate and Other EBIT
(d)
$
(81
)
$
(92
)
$
(227
)
$
(208
)
Non-core Segment EBIT (d) (f)
$
53
$
24
$
92
$
(114
)
Certain (gains) & charges (b)
—
—
—
—
Adjusted Non-core Segment EBIT
(d)
$
53
$
24
$
92
$
(114
)
Total Segment EBIT (d)
$
784
$
351
$
2,329
$
919
Mark-to-market timing difference (a)
44
$
161
$
(151
)
$
186
Total Certain (gains) & charges
(b)
(158
)
$
—
$
(328
)
$
71
Adjusted Total Segment EBIT (d)
$
670
$
512
$
1,850
$
1,176
(a)
Mark-to-market timing impact of certain
commodity and freight contracts, readily marketable inventories,
and related hedges associated with committed future operating
capacity. See note 3 in the Additional Financial information
section of this release for details.
(b)
Certain (gains) & charges included in
Total Segment EBIT. See Additional Financial Information for
details.
(c)
Retained earnings impact associated with
an adjustment to the carrying amount of the redeemable
noncontrolling interest recorded in respect of our 70% ownership
interest in Loders. See note 4 in the Additional Financial
information section of this release for details.
(d)
Core Segment EBIT, Adjusted Core Segment
EBIT, Corporate and Other EBIT, Adjusted Corporate and Other EBIT,
Non-core Segment EBIT, Adjusted Non-core Segment EBIT, Total
Segment EBIT, Adjusted Total Segment EBIT, and Adjusted Net income
per common share-diluted are non-GAAP financial measures.
Reconciliations to the most directly comparable U.S. GAAP measures
are included in the tables attached to this press release and the
accompanying slide presentation posted on Bunge's website.
(e)
Core Segment earnings before interest and
tax ("Core Segment EBIT") comprises the aggregate earnings before
interest and tax (“EBIT”) of Bunge’s Agribusiness, Refined and
Specialty Oils and Milling reportable segments, and excludes
Bunge's Sugar & Bioenergy reportable segment and Corporate and
Other activities.
(f)
Non-core Segment EBIT comprises Bunge’s
Sugar & Bioenergy reportable segment EBIT, which reflects
Bunge's share of the results of its 50/50 joint venture with BP
p.l.c.
Core Segments
Agribusiness
Quarter Ended
Nine Months Ended
(US$ in millions, except per share
data)
Sep 30, 2021
Sep 30, 2020
Sep 30, 2021
Sep 30, 2020
Volumes (in thousand metric
tons)
30,486
36,319
106,375
107,269
Net Sales
$
9,868
$
7,290
$
31,312
$
20,597
Gross Profit
$
591
$
373
$
1,887
$
1,278
Selling, general and administrative
expense
$
(118
)
$
(145
)
$
(313
)
$
(365
)
Foreign exchange gains (losses)
$
(30
)
$
59
$
(1
)
$
78
EBIT attributable to noncontrolling
interests
$
5
$
(2
)
$
(6
)
$
(7
)
Other income (expense) - net
$
181
$
15
$
227
$
39
Income (loss) from affiliates
$
10
$
17
$
44
$
46
Segment EBIT
$
639
$
317
$
1,838
$
1,069
Mark-to-market timing difference
52
168
(144
)
175
Certain (gains) & charges
(158
)
—
(158
)
—
Adjusted Segment EBIT
$
533
$
485
$
1,536
$
1,244
Certain (gains) & charges, Net Income
(Loss) Attributable to Bunge
$
(119
)
$
—
$
(119
)
$
—
Certain (gains) & charges, Earnings
Per Share
$
(0.78
)
$
—
$
(0.78
)
$
—
Processing (2)
Quarter Ended
Nine Months Ended
(US$ in millions)
Sep 30, 2021
Sep 30, 2020
Sep 30, 2021
Sep 30, 2020
Processing EBIT
$
298
$
235
$
1,364
$
828
Mark-to-market timing difference
194
178
(301
)
141
Certain (gains) & charges
(73
)
—
(73
)
—
Adjusted Processing EBIT
$
419
$
413
$
990
$
969
In Processing, higher results in North America, European
softseeds and our Asian and European destination value chains,
which all benefited from strong vegetable oil demand, were
partially offset by lower results in South America, where margins
were down compared to a particularly strong prior year.
Merchandising (2)
Quarter Ended
Nine Months Ended
(US$ in millions)
Sep 30, 2021
Sep 30, 2020
Sep 30, 2021
Sep 30, 2020
Merchandising EBIT
$
341
$
82
$
474
$
241
Mark-to-market timing difference
(142
)
(10
)
157
34
Certain (gains) & charges
(85
)
—
(85
)
—
Adjusted Merchandising EBIT
$
114
$
72
$
546
$
275
In Merchandising, improved performance was primarily driven by
higher results in ocean freight, due to strong execution, and our
global vegetable oil value chain, which benefited from increased
margins.
Refined & Specialty Oils
Quarter Ended
Nine Months Ended
(US$ in millions, except per share
data)
Sep 30, 2021
Sep 30, 2020
Sep 30, 2021
Sep 30, 2020
Volumes (in thousand metric
tons)
2,390
2,475
6,841
7,115
Net Sales
$
3,648
$
2,432
$
9,572
$
6,887
Gross Profit
$
218
$
178
$
648
$
453
Selling, general and administrative
expense
$
(83)
$
(96)
$
(259)
$
(279)
Foreign exchange gains (losses)
$
(1)
$
(2)
$
1
$
—
EBIT attributable to noncontrolling
interests
$
(2)
$
(3)
$
(85)
$
3
Other income (expense) - net
$
(2)
$
(1)
$
236
$
(3)
Segment EBIT
$
130
$
76
$
541
$
174
Mark-to-market timing difference
12
(9)
9
8
Certain (gains) & charges
—
—
(170)
—
Adjusted Segment EBIT
$
142
$
67
$
380
$
182
Certain (gains) & charges, Net Income
(Loss) Attributable to Bunge
$
—
$
—
$
(165)
$
—
Certain (gains) & charges, Earnings
Per Share
$
—
$
—
$
(1.08)
$
—
Refined & Specialty Oils Summary
The strong performance in the quarter was primarily driven by
higher margins and volumes in North America refining, which
continued to benefit from a recovery in foodservice and increased
demand from the renewable diesel sector. Higher margins in Europe
driven by favorable product mix also contributed to the improved
performance. Results in South America and Asia were slightly higher
than last year.
Milling
Quarter Ended
Nine Months Ended
(US$ in millions, except per share
data)
Sep 30, 2021
Sep 30, 2020
Sep 30, 2021
Sep 30, 2020
Volumes (in thousand metric
tons)
1,542
1,231
4,789
4,430
Net Sales
$
530
$
388
$
1,392
$
1,185
Gross Profit
$
70
$
50
$
161
$
149
Selling, general and administrative
expense
$
(25
)
$
(24
)
$
(73
)
$
(77
)
Foreign exchange gains (losses)
$
(2
)
$
1
$
(2
)
$
—
Segment EBIT
$
43
$
26
$
85
$
69
Mark-to-market timing difference
(20
)
2
(16
)
3
Certain (gains) & charges
—
—
—
—
Adjusted Segment EBIT
$
23
$
28
$
69
$
72
Certain (gains) & charges, Net Income
(Loss) Attributable to Bunge
$
—
$
—
$
—
$
—
Certain (gains) & charges, Earnings
Per Share
$
—
$
—
$
—
$
—
Milling Summary
Lower results in the quarter were driven by Brazil where higher
volume was more than offset by lower margins and higher supply
chain costs. Results in North America were comparable with last
year.
Corporate and Other
Quarter Ended
Nine Months Ended
(US$ in millions, except per share
data)
Sep 30, 2021
Sep 30, 2020
Sep 30, 2021
Sep 30, 2020
Gross Profit
$
(19
)
$
(4
)
$
(25
)
$
(6
)
Selling, general and administrative
expense
$
(101
)
$
(87
)
$
(250
)
$
(272
)
Foreign exchange gains (losses)
$
(3
)
$
(4
)
$
(9
)
$
(3
)
Other income (expense) - net
$
41
$
3
$
55
$
2
Segment EBIT
$
(81
)
$
(92
)
$
(227
)
$
(279
)
Certain (gains) & charges
—
—
—
71
Adjusted Segment EBIT
$
(81
)
$
(92
)
$
(227
)
$
(208
)
Certain (gains) & charges, Net Income
(Loss) Attributable to Bunge
$
—
$
(21
)
$
—
$
48
Certain (gains) & charges, Earnings
Per Share
$
—
$
(0.14
)
$
—
$
0.32
Corporate
Quarter Ended
Nine Months Ended
(US$ in millions)
Sep 30, 2021
Sep 30, 2020
Sep 30, 2021
Sep 30, 2020
Corporate EBIT
$
(114
)
$
(93
)
$
(270
)
$
(223
)
Certain (gains) & charges
—
—
—
5
Adjusted Corporate EBIT
$
(114
)
$
(93
)
$
(270
)
$
(218
)
Other
Quarter Ended
Nine Months Ended
(US$ in millions)
Sep 30, 2021
Sep 30, 2020
Sep 30, 2021
Sep 30, 2020
Other EBIT
$
33
$
1
$
43
$
(56
)
Certain (gains) & charges
—
—
—
66
Adjusted Other EBIT
$
33
$
1
$
43
$
10
Corporate and Other Summary
The increase in Corporate expenses during the quarter was
primarily related to performance-based compensation accruals. The
gain in Other was primarily related to our Bunge Venture’s
investment in Benson Hill, which went public during the
quarter.
Non-core Segments
Sugar & Bioenergy
Quarter Ended
Nine Months Ended
(US$ in millions, except per share
data)
Sep 30, 2021
Sep 30, 2020
Sep 30, 2021
Sep 30, 2020
Volumes (in thousand metric
tons)
91
95
291
244
Net Sales
$
69
$
49
$
190
$
125
Gross Profit
$
2
$
5
$
3
$
7
Income (loss) from affiliates
$
51
$
19
$
89
$
(121
)
Segment EBIT
$
53
$
24
$
92
$
(114
)
Certain (gains) & charges
—
—
—
—
Adjusted Segment EBIT
$
53
$
24
$
92
$
(114
)
Certain (gains) & charges, Net Income
(Loss) Attributable to Bunge
$
—
$
—
$
—
$
—
Certain (gains) & charges, Earnings
Per Share
$
—
$
—
$
—
$
—
Sugar & Bioenergy Summary
Improved results in the quarter were primarily driven by higher
prices and sales volumes of ethanol and sugar.
Cash Flow
Nine Months Ended
Sep 30, 2021
Sep 30, 2020
Cash used for operating activities
$
(1,642
)
(2,128
)
Net proceeds from beneficial interest in
securitized trade receivables
3,255
1,164
Cash provided by (used for) operating
activities, adjusted
$
1,613
(964
)
Cash used for operations in the nine months ended September 30,
2021 was $1,642 million compared to cash used of $2,128 million in
the same period last year. Adjusting for the net proceeds from
beneficial interest in securitized trade receivables, cash provided
from operating activities was $1,613 million compared with cash
used for operating activities of $964 million in the prior year.
Funds from operations (FFO) adjusted for notable items and
mark-to-market timing differences was $1,304 million compared to
$1,299 million in the prior year(5).
Income Taxes
For the nine months ended September 30, 2021, income tax expense
was $334 million compared to $151 million for the prior year. The
increase in income tax expense is due to higher pre-tax income,
partially offset by a lower estimated effective tax rate for
2021.
Bunge continues to take proactive steps to protect the health
and safety of its employees, their families and the communities in
which it operates. Through an internal task force, the Company
closely monitors developments related to the pandemic and provides
guidance to its facilities worldwide. Bunge is strongly encouraging
its employees to be vaccinated when available in their countries,
and facilitating this when possible.
To date, the Company has been able to mitigate logistics and
distribution issues that have arisen, and substantially all of its
facilities around the world have continued to operate at or near
normal levels. Bunge continues to monitor local, regional and
national governmental actions that could limit or restrict the
movement of agricultural commodities or products or otherwise
disrupt physical product flows or its ability to operate in the
future.
We are increasing our full-year 2021 adjusted EPS outlook to at
least $11.50 per share.
In Agribusiness, results are expected to be up from our previous
outlook and now forecasted to be higher than last year, reflecting
our strong third quarter and favorable market trends.
In Refined and Specialty Oils, results are expected to be up
from our previous outlook and well above last year, reflecting
strong third quarter results and positive demand trends in North
America.
We continue to expect results in Milling to be generally in line
with last year.
Excluding Bunge Ventures, Corporate and Other is expected to be
lower than last year, driven by higher performance-based
compensation, a portion of which was historically allocated to the
segments.
Additionally, the Company now expects the following for 2021: an
adjusted annual effective tax rate in the range of 15% to 17%; net
interest expense in the range of $200 to $210 million; capital
expenditures in the range of $350 to $400 million; and depreciation
and amortization of approximately $420 million.
In Non-Core, full-year results in the sugar and bioenergy joint
venture are now expected to be up significantly from the prior
year.
- Conference Call and Webcast Details
Bunge Limited’s management will host a conference call at 8:00
a.m. Eastern (7:00 a.m. Central) on Wednesday, October 27, 2021 to
discuss the company’s results.
Additionally, a slide presentation to accompany the discussion
of results will be posted on www.bunge.com.
To listen to the call, please dial 1 (844) 735-3666. If you are
located outside the United States or Canada, dial +1 (412)
317-5706. Please dial in five to 10 minutes before the scheduled
start time. The call will also be webcast live at www.bunge.com.
To access the webcast, go to “Events and presentations” in the
“Investors” section of the company’s website. Select “Q3 2021 Bunge
Limited Earnings Conference Call” and follow the prompts. Please go
to the website at least 15 minutes prior to the call to register
and download any necessary audio software.
A replay of the call will be available later in the day on
October 27, 2021, continuing through November 27, 2021. To listen
to it, please dial 1 (877) 344-7529 in the United States, 1 (855)
669-9658 in Canada, or +1 (412) 317-0088 in other locations. When
prompted, enter confirmation code 10160167. A replay will also be
available in "Past events" at "Events and presentations" in the
"Investors" section of the company's website.
At Bunge (NYSE: BG), our purpose is to connect farmers to
consumers to deliver essential food, feed and fuel to the world.
With more than two centuries of experience, unmatched global scale
and deeply rooted relationships, we work to put quality food on the
table, increase sustainability where we operate, strengthen global
food security, and help communities prosper. As the world’s leader
in oilseed processing and a leading producer and supplier of
specialty plant-based oils and fats, we value our partnerships with
farmers to improve the productivity and environmental efficiency of
agriculture across our value chains and to bring quality products
from where they’re grown to where they’re consumed. At the same
time, we collaborate with our customers to create and reimagine the
future of food, developing tailored and innovative solutions to
meet evolving dietary needs and trends in every part of the world.
Our Company is headquartered in St. Louis, Missouri, and we have
almost 23,000 dedicated employees working across approximately 300
facilities located in more than 40 countries.
We routinely post important information for investors on our
website, www.bunge.com, in the "Investors" section. We may use this
website as a means of disclosing material, non-public information
and for complying with our disclosure obligations under Regulation
FD. Accordingly, investors should monitor the Investors section of
our website, in addition to following our press releases, SEC
filings, public conference calls, presentations and webcasts. The
information contained on, or that may be accessed through, our
website is not incorporated by reference into, and is not a part
of, this document.
- Cautionary Statement Concerning Forward-Looking
Statements
This press release contains both historical and forward-looking
statements. All statements, other than statements of historical
fact are, or may be deemed to be, forward looking statements within
the meaning of Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities Exchange Act of 1934, as
amended (Exchange Act). These forward looking statements are not
based on historical facts, but rather reflect our current
expectations and projections about our future results, performance,
prospects and opportunities. We have tried to identify these
forward looking statements by using words including “may,” “will,”
“should,” “could,” “expect,” “anticipate,” “believe,” “plan,”
“intend,” “estimate,” “continue” and similar expressions. These
forward looking statements are subject to a number of risks,
uncertainties and other factors that could cause our actual
results, performance, prospects or opportunities to differ
materially from those expressed in, or implied by, these forward
looking statements. The following important factors, among others,
could cause actual results to differ from these forward-looking
statements: industry conditions, including fluctuations in supply,
demand and prices for agricultural commodities and other raw
materials and products used in our business, fluctuations in energy
and freight costs; competitive developments in our industries; the
effects of weather conditions and the outbreak of crop and animal
disease on our business; global and regional economic,
agricultural, financial and commodities market, political, social
and health conditions; the impacts of pandemic outbreaks, including
COVID-19; the outcome of pending regulatory and legal proceedings;
our ability to complete, integrate and benefit from acquisitions,
dispositions, joint ventures and strategic alliances; our ability
to achieve the efficiencies, savings and other benefits anticipated
from cost reduction, margin improvement, operational excellence and
other business optimization initiatives; changes in government
policies, laws and regulations affecting our business, including
agricultural and trade policies and environmental, tax and biofuels
regulation; our capital allocation plans, funding needs and
financing sources; changes in foreign exchange policy or rates; the
outcome of our portfolio rationalization initiatives; the
effectiveness of our risk management strategies; our ability to
attract and retain executive management and key personnel;
operational risks, including industrial accidents, natural
disasters and cybersecurity incidents; and other factors affecting
our business generally. The forward-looking statements included in
this release are made only as of the date of this release, and
except as otherwise required by federal securities law, we do not
have any obligation to publicly update or revise any
forward-looking statements to reflect subsequent events or
circumstances.
- Additional Financial Information
Certain gains and (charges), quarter-to-date
The following table provides a summary of certain gains and
(charges) that may be of interest to investors, including a
description of these items and their effect on net income (loss)
attributable to Bunge, earnings per share diluted and segment EBIT
for the three month periods ended September 30, 2021 and 2020.
(US$ in millions, except per share
data)
Net Income (Loss)
Attributable to
Bunge
Earnings
Per Share
Diluted
Segment
EBIT
Quarter Ended September 30,
2021
2020
2021
2020
2021
2020
Core Segments:
$
119
$
—
$
0.78
$
—
$
158
$
—
Agribusiness
$
119
$
—
$
0.78
$
—
$
158
$
—
Gain on sale of a business
119
—
0.78
—
158
—
Refined and Specialty Oil
Products
$
—
$
—
$
—
$
—
$
—
$
—
Milling Products
$
—
$
—
$
—
$
—
$
—
$
—
Corporate and Other:
$
—
$
21
$
—
$
0.14
$
—
$
—
Income tax benefits
—
21
—
0.14
—
—
Non-core Segment:
$
—
$
—
$
—
$
—
$
—
$
—
Sugar & Bioenergy
$
—
$
—
$
—
$
—
$
—
$
—
Total
$
119
$
21
$
0.78
$
0.14
$
158
$
—
See Definition and Reconciliation of Non-GAAP Measures.
Core Segments
Agribusiness
EBIT for the three months ended September 30, 2021 included a
$158 million gain on sale of a portfolio of interior grain
elevators located in the United States (U.S. Grain Disposition),
recorded in Other income (expense) - net.
Corporate and Other
Net Income for the quarter ended September 30, 2020 included a
$21 million benefit related to the reversal of a deferred tax asset
valuation allowance in Europe.
Certain gains and (charges), year-to-date
The following table provides a summary of certain gains and
(charges) that may be of interest to investors, including a
description of these items and their effect on Net income (loss)
attributable to Bunge, Earnings per share diluted and Segment EBIT
for the nine month periods ended September 30, 2021 and 2020.
(US$ in millions, except per share
data)
Net Income (Loss)
Attributable to
Bunge
Earnings
Per Share
Diluted
Segment
EBIT
Nine months ended September 30,
2021
2020
2021
2020
2021
2020
Core Segments:
$
284
$
—
$
1.86
$
—
$
328
$
—
Agribusiness
$
119
$
—
$
0.78
$
—
$
158
$
—
Gain on sale of a business
119
—
0.78
—
158
—
Refined and Specialty Oil
Products
$
165
$
—
$
1.08
$
—
$
170
$
—
Gain on sales of assets
165
—
1.08
—
170
—
Milling Products
$
—
$
—
$
—
$
—
$
—
$
—
Corporate and Other:
$
—
$
(48
)
$
—
$
(0.32
)
$
—
$
(71
)
Severance, employee benefit, and other
costs
—
(3
)
—
(0.02
)
—
(5
)
Commercial claim provision
—
(66
)
—
(0.44
)
—
(66
)
Income tax benefits
—
21
—
0.14
—
—
Non-core Segment:
$
—
$
—
$
—
$
—
$
—
$
—
Sugar & Bioenergy
$
—
$
—
$
—
$
—
$
—
$
—
Total
$
284
$
(48
)
$
1.86
$
(0.32
)
$
328
$
(71
)
See Definition and Reconciliation of Non-GAAP Measures.
Core Segments
Agribusiness
EBIT for the nine months ended September 30, 2021 included a
$158 million gain on sale of a portfolio of interior grain
elevators located in the United States (U.S. Grain Disposition),
recorded in Other income (expense) - net.
Refined and Specialty Oil Products
EBIT for the nine months ended September 30, 2021 included $170
million in gains on sales of assets, comprised of a $151 million
gain on sale of our Rotterdam Oils Refinery, at Bunge's 70% share,
and a $19 million gain on sale of an oils packaging facility in
Mexico, both recorded in Other income (expense) - net.
Corporate and Other
EBIT for the nine month period ended September 30, 2020 included
a $66 million charge primarily related to a provision against an
aged receivable that in the nine months ended September 30, 2020
became deemed uncollectible as part of an anticipated legal
settlement. For this matter $51 million was recorded in SG&A
and $15 million was recorded in Other income (expense) - net. EBIT
for the nine month period ended September 30, 2020 also included $5
million of charges related to the relocation of Bunge’s global
headquarters from White Plains, New York to St. Louis, Missouri,
included in SG&A. Net Income for the nine month period ended
September 30, 2020 included a $21 million benefit related to the
reversal of a deferred tax asset valuation allowance in Europe.
- Consolidated Earnings Data (Unaudited)
Quarter Ended September
30,
Nine Months Ended September
30,
(US$ in millions, except per share
data)
2021
2020
2021
2020
Net sales
$
14,117
$
10,159
$
42,469
$
28,794
Cost of goods sold
(13,255
)
(9,557
)
(39,795
)
(26,913
)
Gross profit
862
602
2,674
1,881
Selling, general and administrative
expenses
(327
)
(352
)
(896
)
(993
)
Foreign exchange (losses) gains
(36
)
54
(11
)
75
Other income (expense) – net
220
17
519
37
Income (loss) from affiliates
60
35
133
(76
)
EBIT attributable to noncontrolling
interest (a) (1)
5
(5
)
(90
)
(5
)
Total Segment EBIT
784
351
2,329
919
Interest income
19
5
34
18
Interest expense
(57
)
(56
)
(184
)
(195
)
Income tax (expense) benefit
(92
)
(38
)
(334
)
(151
)
Noncontrolling interest share of interest
and tax (a) (1)
(1
)
—
2
3
Net income (loss) attributable to Bunge
(1)
653
262
1,847
594
Convertible preference share dividends
(8
)
(8
)
(25
)
(25
)
Adjustment of redeemable noncontrolling
interest
—
12
—
2
Net income (loss) available to Bunge
common shareholders
$
645
$
266
$
1,822
$
571
Add back convertible preference share
dividends
8
8
25
25
Net income (loss) available to Bunge
common shareholders - diluted
$
653
$
274
$
1,847
$
596
Net income (loss) per common share
diluted attributable to Bunge common shareholders
$
4.28
$
1.84
$
12.12
$
3.98
Weighted–average common shares
outstanding - diluted
153
149
152
150
(a) The line items "EBIT attributable to
noncontrolling interest" and "Noncontrolling interest share of
interest and tax" when combined, represent consolidated Net
(income) loss attributable to noncontrolling interests on a U.S.
GAAP basis of presentation.
- Condensed Consolidated Balance Sheets (Unaudited)
September 30,
December 31,
(US$ in millions)
2021
2020
Assets
Cash and cash equivalents
$
1,033
$
352
Trade accounts receivable, net
2,431
1,717
Inventories (a)
8,014
7,172
Assets held for sale
—
672
Other current assets
5,056
6,268
Total current assets
16,534
16,181
Property, plant and equipment, net
3,658
3,775
Operating lease assets
910
868
Goodwill and other intangible assets,
net
1,044
1,115
Investments in affiliates
755
631
Other non-current assets
1,208
1,085
Total assets
$
24,109
$
23,655
Liabilities and Equity
Short-term debt
$
1,151
$
2,828
Current portion of long-term debt
510
8
Trade accounts payable
3,944
2,636
Current operating lease obligations
332
235
Liabilities held for sale
—
438
Other current liabilities
3,822
4,840
Total current liabilities
9,759
10,985
Long-term debt
4,814
4,452
Non-current operating lease
obligations
522
581
Other non-current liabilities
980
1,017
Total liabilities
16,075
17,035
Redeemable noncontrolling
interest
403
415
Total equity
7,631
6,205
Total liabilities, redeemable
noncontrolling interest and equity
$
24,109
$
23,655
(a) Includes readily marketable
inventories of $6,505 million and $5,961 million at September 30,
2021 and December 31, 2020, respectively. Of these amounts, $4,956
million and $4,369 million, respectively, can be attributable to
merchandising activities.
- Condensed Consolidated Statements of Cash Flows
(Unaudited)
Nine Months Ended
September 30,
(US$ in millions)
2021
2020
Operating Activities
Net income (loss) (1)
$
1,935
$
596
Adjustments to reconcile net income (loss)
to cash provided by (used for) operating activities:
Foreign exchange (gain) loss on net
debt
7
(126
)
Depreciation, depletion and
amortization
317
323
Deferred income tax expense (benefit)
(263
)
51
(Gain) loss on sale of investments and
property, plant and equipment
(416
)
(19
)
Other, net
(55
)
204
Changes in operating assets and
liabilities, excluding the effects of acquisitions:
Trade accounts receivable
(785
)
(237
)
Inventories
(771
)
(1,679
)
Secured advances to suppliers
(42
)
(296
)
Trade accounts payable and accrued
liabilities
1,268
260
Advances on sales
(129
)
(119
)
Net unrealized (gain) loss on derivative
contracts
559
173
Margin deposits
280
(360
)
Marketable securities
(95
)
98
Beneficial interest in securitized trade
receivables
(3,621
)
(1,178
)
Other, net
169
181
Cash provided by (used for) operating
activities
(1,642
)
(2,128
)
Investing Activities
Payments made for capital expenditures
(239
)
(230
)
Proceeds from investments
171
270
Payments for investments
(217
)
(293
)
Settlement of net investment hedges
(29
)
67
Proceeds from beneficial interest in
securitized trade receivables
3,432
1,164
Payments for beneficial interest in
securitized trade receivables
(177
)
—
Proceeds from the sale of investments and
property, plant and equipment
646
15
Payments for investments in affiliates
(46
)
(14
)
Other, net
21
1
Cash provided by (used for) investing
activities
3,562
980
Financing Activities
Net borrowings (repayments) of short-term
debt
(1,641
)
683
Net proceeds (repayments) of long-term
debt
998
796
Proceeds from the exercise of options for
common shares
72
2
Repurchases of common shares
(100
)
(100
)
Dividends paid to common and preference
shareholders
(240
)
(237
)
Dividends paid to noncontrolling interest
holders
(75
)
—
Acquisition of noncontrolling interest
(147
)
—
Other, net
(33
)
(15
)
Cash provided by (used for) financing
activities
(1,166
)
1,129
Effect of exchange rate changes on cash
and cash equivalents and restricted cash
(79
)
5
Net increase (decrease) in cash and
cash equivalents and restricted cash
675
(14
)
Cash and cash equivalents and
restricted cash - beginning of period
381
322
Cash and cash equivalents and
restricted cash - end of period
$
1,056
$
308
- Definition and Reconciliation of Non-GAAP Measures
This earnings release contains certain "non-GAAP financial
measures" as defined in Regulation G of the Securities Exchange Act
of 1934. Bunge has reconciled these non-GAAP financial measures to
the most directly comparable U.S. GAAP measures below. These
measures may not be comparable to similarly titled measures used by
other companies.
Total Segment EBIT and Adjusted Total Segment EBIT
Bunge uses segment earnings before interest and tax (“Segment
EBIT”) to evaluate the operating performance of its individual
segments. Segment EBIT excludes EBIT attributable to noncontrolling
interests. Bunge also uses Core Segment EBIT, Non-Core Segment EBIT
and Total Segment EBIT to evaluate the operating performance of
Bunge’s Core reportable segments, Non-Core reportable segments, and
Total reportable segments together with its corporate and other
activities, respectively. Core Segment EBIT is the aggregate of the
earnings before interest and taxes of each of Bunge’s Agribusiness,
Refined and Specialty Oils, and Milling segments. Non-Core Segment
EBIT is the earnings before interest and taxes of Bunge’s Sugar
& Bioenergy segment. Total Segment EBIT is the aggregate of the
earnings before interest and taxes of Bunge’s Core and Non-Core
reportable segments, together with its corporate and other
activities.
Adjusted Core Segment EBIT, Adjusted Non-Core Segment EBIT, and
Adjusted Total Segment EBIT, are calculated by excluding temporary
mark-to-market timing differences, as defined in note 3 below, and
certain gains and (charges), as described in "Additional Financial
Information" above, from Core Segment EBIT, Non-Core Segment EBIT,
and Total Segment EBIT, respectively.
Core Segment EBIT, Non-Core Segment EBIT, Total Segment EBIT,
Adjusted Core Segment EBIT, Adjusted Non-Core Segment EBIT, and
Adjusted Total Segment EBIT are non-GAAP financial measures and are
not intended to replace Net income (loss) attributable to Bunge,
the most directly comparable U.S. GAAP financial measure. Bunge's
management believes these non-GAAP measures are a useful measure of
its reportable segments' operating profitability, since the
measures allow for an evaluation of segment performance without
regard to their financing methods or capital structure. For this
reason, operating performance measures such as these non-GAAP
measures are widely used by analysts and investors in Bunge's
industries. These non-GAAP measures are not a measure of
consolidated operating results under U.S. GAAP and should not be
considered as an alternative to net income (loss) or any other
measure of consolidated operating results under U.S. GAAP.
Net Income (loss) attributable to Bunge to Adjusted Net
Income (loss) available for common shareholders
Adjusted Net Income (loss) excludes temporary mark-to-market
timing differences, as defined in note 3 below, and certain gains
and (charges), as described in "Additional Financial Information"
above, and is a non-GAAP financial measure. This measure is not a
measure of Net income (loss) attributable to Bunge, the most
directly comparable U.S. GAAP financial measure. It should not be
considered as an alternative to Net Income (loss) attributable to
Bunge, Net Income (loss), or any other measure of consolidated
operating results under U.S. GAAP. Adjusted Net income (loss) is a
useful measure of the Company's profitability.
We also have presented projected adjusted net income per common
share for 2021. This information is provided only on a non-GAAP
basis without reconciliation to projected net income per common
share for 2021, the mostly directly comparable GAAP measure, due to
the inability at this time to quantify certain amounts necessary
for such reconciliation, including but not limited to future market
price movements over the remainder of the year.
Below is a reconciliation of Net income attributable to Bunge,
to Total Segment EBIT, and Adjusted Total Segment EBIT:
Quarter Ended
September 30,
Nine Months Ended
September 30,
(US$ in millions)
2021
2020
2021
2020
Net income (loss) attributable to
Bunge
$
653
$
262
$
1,847
$
594
Interest income
(19
)
(5
)
(34
)
(18
)
Interest expense
57
56
184
195
Income tax expense (benefit)
92
38
334
151
Noncontrolling interest share of interest
and tax
1
—
(2
)
(3
)
Total Segment EBIT
$
784
$
351
$
2,329
$
919
Agribusiness EBIT
$
639
$
317
$
1,838
$
1,069
Refined and Specialty Oils EBIT
130
76
541
$
174
Milling EBIT
43
26
85
$
69
Core Segment EBIT
$
812
$
419
$
2,464
$
1,312
Corporate and Other EBIT
$
(81
)
$
(92
)
$
(227
)
$
(279
)
Sugar & Bioenergy EBIT
$
53
$
24
$
92
$
(114
)
Non-Core Segment EBIT
$
53
$
24
$
92
$
(114
)
Total Segment EBIT
$
784
$
351
$
2,329
$
919
Mark-to-market timing difference
44
161
(151
)
186
Certain (gains) & charges
(158
)
—
(328
)
71
Adjusted Total Segment EBIT
$
670
$
512
$
1,850
$
1,176
Below is a reconciliation of Net income attributable to Bunge,
to Adjusted Net income (loss) available for common
shareholders:
Quarter Ended
September 30,
Nine Months Ended
September 30,
(US$ in millions, except per share
data)
2021
2020
2021
2020
Net income (loss) attributable to
Bunge
$
653
$
262
$
1,847
$
594
Mark-to-market timing difference
33
126
(126
)
146
Certain (gains) and charges:
Severance, employee benefit, and
other
—
—
—
3
Commercial claim provision
—
—
—
66
Gain on sales of assets
—
—
(165
)
—
Gain on sale of a business
(119
)
—
(119
)
—
Income tax benefits
—
(21
)
—
(21
)
Adjusted Net income (loss) available
for common shareholders
$
567
$
367
$
1,437
$
788
Weighted-average common shares outstanding
- diluted, adjusted (a)
153
149
152
150
Adjusted Net income (loss) per common
share - diluted
$
3.72
$
2.47
$
9.43
$
5.26
(a) Approximately 2 and 6 million
outstanding stock options and contingently issuable restricted
stock units were not dilutive and not included in the
weighted-average number of common shares outstanding for the three
months ended September 30, 2021 and 2020, respectively.
Approximately 2 million and 6 million outstanding stock options and
contingently issuable restricted stock units were not dilutive and
not included in the weighted-average number of common shares
outstanding for the nine months ended September 30, 2021 and 2020,
respectively.
(1)
A reconciliation of Net income (loss)
attributable to Bunge, to Net income (loss) is as follows:
Nine months ended September
30,
(US$ in millions)
2021
2020
Net income (loss) attributable to
Bunge
$
1,847
$
594
EBIT attributable to noncontrolling
interest
90
5
Noncontrolling interest share of interest
and tax
(2)
(3)
Net income (loss)
$
1,935
$
596
(2)
The Processing business included in our
Agribusiness segment consists of: global oilseed processing
activities, which principally include the origination and crushing
of oilseeds (including soybeans, canola, rapeseed and sunflower
seed) into protein meals and vegetable oils; the distribution of
oilseeds, oilseed products and fertilizer products through our port
terminals and transportation assets (including trucks, railcars,
barges and ocean vessels); fertilizer production; and biodiesel
production, which is partially conducted through joint
ventures.
The Merchandising business included in our
Agribusiness segment primarily consists of: global grain
origination activities, which principally include the purchasing,
cleaning, drying, storing and handling of corn, wheat and barley at
our network of grain elevators; logistical services for the
distribution of these commodities to our customer markets through
our port terminals and transportation assets (including trucks,
railcars, barges and ocean vessels); and financial services and
activities for customers from whom we purchase commodities, and
other third parties.
(3)
Mark-to-market timing difference comprises
the estimated net temporary impact resulting from unrealized
period-end gains/losses associated with the fair valuation of
certain forward contracts, readily marketable inventories (RMI),
and related futures contracts associated with our committed future
operating capacity. The impact of these mark-to-market timing
differences, which is expected to reverse over time due to the
forward contracts, RMI, and related futures contracts being part of
an economically-hedged position, is not representative of the
operating performance of our business.
(4)
In the reconciliation of Net income (loss)
per common share - diluted ("GAAP EPS") to Adjusted Net income
(loss) per common share - diluted ("Adjusted EPS"), the item
"Adjustment of redeemable noncontrolling interest" represents the
impact on GAAP EPS of a retained earnings adjustment associated
with the carrying amount of the redeemable noncontrolling interest
recorded in respect of our 70% ownership interest in Loders. The
carrying amount of redeemable noncontrolling interests is the
greater of: (i) the initial carrying amount, increased or decreased
for the noncontrolling interests’ share of net income or loss,
equity capital contributions and distributions or (ii) the
redemption value. Any resulting increases in the redemption value,
in excess of the initial carrying amount, increased or decreased
for the noncontrolling interests’ share of net income or loss,
equity capital contributions and distributions, are affected by
corresponding charges against retained earnings. Additionally, any
such charges to retained earnings will affect Net income (loss)
available to Bunge common shareholders as part of Bunge's
calculation of GAAP EPS.
Bunge's management excludes the
“Adjustment of redeemable noncontrolling interest" from its
calculation of Adjusted EPS, on the basis that it is independent of
the Company's operations. However, such charges reverse only to the
extent that Loders' net income levels result in the carrying amount
of redeemable noncontrolling interests, calculated as described
above, exceeding the redemption value.
(5)
A reconciliation of Cash provided by (used
for) operating activities to Adjusted funds from operations (FFO)
is as follows:
Nine months ended September
30,
(US$ in millions)
2021
2020
Cash provided by (used for) operating
activities
$
(1,642)
$
(2,128)
Foreign exchange gain (loss) on net
debt
(7)
126
Working capital changes
3,167
3,157
Net (income) loss attributable to
noncontrolling interests and redeemable noncontrolling
interests
(88)
(2)
Mark-to-Market timing difference, after
tax
(126)
146
Adjusted FFO
$
1,304
$
1,299
View source
version on businesswire.com: https://www.businesswire.com/news/home/20211027005383/en/
Investor Contact: Ruth Ann Wisener Bunge Limited
636-292-3014 ruthann.wisener@bunge.com
Media Contact: Bunge News Bureau Bunge Limited
636-292-3022 news@bunge.com
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