Bunge Limited (NYSE: BG) reported Q4 EPS of $0.08, $0.12 worse than the analyst estimate of $0.20. Revenue for the quarter came in at $11.54 billion versus the consensus estimate of $11.75 billion.

• Full-year 2018 GAAP EPS of $1.57 vs. $0.89 in the prior year; $2.72 vs. $1.94 on an adjusted basis;
• Q4 GAAP EPS of $(0.51) vs.$(0.48) in the prior year; $0.08 vs. $0.67 on an adjusted basis
• Agribusiness impacted by decline in value of Brazilian soybean ownership; full year results up 114% on strong soy crush margins
• In Food & Ingredients, Loders Croklaan integration proceeding as planned
• Sugar & Bioenergy impacted by heavy rains as poor crop year came to an end
• Global Competitiveness Program delivered $200 million of savings in 2018, expect $50 million of additional savings in 2019, reaching original target a year ahead of schedule
  

Kathleen Hyle, Bunge's Non-Executive Board Chair, stated, "Although 2018 was a substantially better year than 2017, we are not satisfied with these results, and we know that Bunge has the global assets and people to perform better in the future. In the past several months, the Company has taken a number of significant and positive steps to reposition itself for sustainable growth, including announcing a leadership transition and enhancing its leadership team, refreshing our Board and establishing a Strategic Review Committee of the Board."

Ms. Hyle continued, "The Committee initiated and is continuing a thorough, outside-in review of all of Bunge\'s businesses. At the same time, we are committed to addressing underperforming assets as part of our effort to enhance shareholder value, and we are strengthening our risk management capabilities, as they are foundational to everything we do. The Board and the leadership team are moving with speed and accountability to drive results."

Acting CEO Greg Heckman commented, "Even in my short time leading the company, I see many strengths. We have a world-class global network of assets and a talented team of people, all of whom are committed to driving the business forward. While the Strategic Review Committee continues its work, we are refocusing the organization and placing greater emphasis on improved execution. Our key priorities are to drive operational performance, optimize the portfolio, strengthen our capital allocation framework and sharpen our financial discipline. I am confident that with the actions we are taking, we will be able to better leverage Bunge's asset base and increase shareholder returns."

Outlook

Beginning in 2019, the Company is changing its guidance approach. Bunge will provide directional guidance for the company instead of individual segment EBIT ranges as it has previously.

In Agribusiness, based on the current soy crush margin environment, 2019 full-year results would be expected to be lower than 2018. Actual soy crush margins over the course of the year are likely to evolve based on U.S.-China trade discussions, crop sizes and farmer commercialization. Based on the current softseed crush margin environment, results would be slightly higher than last year, driven by strong oil demand. Improvements in risk management and in how we operate should support higher results in Grains compared with last year.

In Food & Ingredients, full-year results in Edible Oils should benefit from 12 months of ownership of Loders Croklaan, as well as increased synergies from the integration of our B2B businesses. Favorable Milling operating environments in Brazil and the U.S. are likely to be partially offset by more challenging conditions in Mexico.

In Sugar & Bioenergy, based on normal weather and forward price curves for sugar and ethanol, full-year 2019 results would be expected to be about break-even. Approximately 60% of sugar production has been hedged and, weather permitting, the Company plans to crush approximately 19 mmt of cane. As in past years, results will be seasonally weighted to the second half of the year.

In Fertilizer, based on the current market environment, full-year results would be lower than last year.

The Global Competitiveness Program is expected to generate approximately $50 million of incremental year-over-year savings. The Company expects additional savings from industrial and supply chain initiatives, which are expected to offset inflation.

Additionally, the Company expects the following for 2019: A tax rate in the range of 22% to 26%; net interest expense in the range of $290 to $310 million; capital expenditures of approximately $550 million, of which approximately $115 million is related to sugarcane milling; and depreciation, depletion and amortization of approximately $650 million.

For earnings history and earnings-related data on Bunge Limited (BG) click here.