WHITE PLAINS, N.Y. (AP) — Agribusiness company Bunge Ltd. said Thursday its second-quarter earnings plummeted due to the ongoing impact of last year's drought on grain and other crops.
Company executives said business should pick up in the second half of the year due to lower prices driven by larger harvests in the northern hemisphere.
The company, which sells and purchases huge amounts of grain, said its net income after paying preferred dividends fell to $110 million, or 75 cents per share, from $265 million, or $1.78 per share, in the second quarter of 2012.
Net sales rose 7 percent to $15.5 billion.
Analysts, on average, were looking for earnings of $1.27 per share, on revenue of 15.87 billion, according to FactSet.
Like many agribusiness conglomerates, Bunge is facing higher prices for grain and other agricultural products.
The company reported record business for its agribusiness division in Brazil, but not enough to offset weakness in North America, Europe and Argentina. The business ships and processes soybeans and other commodities into food products.
"We navigated the choppy markets well, but faced some challenges in North America, Europe and Argentina, which suffered from the continued effects of last year's poor oilseed and grain crops," Soren Schroder, Bunge's CEO, said in a statement.
Schroder said the company expects demand to increase in the second half of the year on lower prices driven by large harvests.
Bunge Limited shares added a penny to $74.23 in afternoon trading. The stock has traded between $61.66 and $80.99 in the past 52 weeks, and is up about 2 percent since the start of the year.