Bunge Limited (NYSE: BG) reported Q2 EPS of $3.88, $2.56 better than the analyst estimate of $1.32. Revenue for the quarter came in at $9.46 billion versus the consensus estimate of $9.7 billion.

• Q2 GAAP EPS of $3.47 vs. $1.43 in the prior year; $3.88 vs. $1.52 on an adjusted basis
• Core Agribusiness and Food & Ingredients businesses generated strong results
• Agribusiness earnings improved on excellent execution; results also benefited from ~$380 million of timing differences related to expected Q1 reversals and new mark-to-market gains
• Edible Oils performed better than expected
• Increasing full-year earnings outlook to reflect better than expected Q2

COVID-19 Update

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. Each of Bunge's facilities around the globe is taking steps to respond to COVID-19 based on the nature of its operations and the actions being taken by local governments. The Company has restricted travel, upgraded the cleaning practices at its facilities and offices, implemented remote work arrangements for teammates wherever possible, reduced staffing in its production facilities and instituted social distancing measures.

Numerous countries around the globe, including places where Bunge operates production facilities or maintains offices, have implemented shelter-in-place or stay-at-home orders. While many of these countries have subsequently eased these orders, some have re-instated shelter-in-place or stay-at-home orders, and other countries are expected to follow suit if the virus continues to spread. In locations where such orders are in place, Bunge has been deemed an essential or life-sustaining operation. To date, the Company has not seen a significant disruption in its supply chain, 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 governmental actions that could limit or restrict the movement of agricultural commodities or products or otherwise disrupt physical product flows.

The Company's strong balance sheet and access to committed capital will continue to be important in allowing it to reliably serve customers and continue to operate its global platform while protecting the health and safety of its employees. At the end of the second quarter of 2020, Bunge had $277 million in cash and short-term investments on hand and $3.6 billion of its $4.3 billion of committed credit lines were unused and available. It also continues to have access to the capital markets at a competitive cost of funds.

Overview

Greg Heckman, Bunge's Chief Executive Officer, commented, "Bunge had an outstanding second quarter, with strong performance across all of our core businesses while maintaining a sharp focus on the safety of our team. Our execution against committed crush capacity and coordination of trade flows was exceptional. We realized the benefit from our risk management decisions in the first half of this year and earned new business with our focus on innovation and our collaborative approach with customers. We generated strong cash flow while being disciplined in our approach to capital allocation, and continued to execute on our key priorities. These results would be strong in any environment, let alone a pandemic, and we couldn't be more proud of the resilience and commitment of our team."

Outlook

We are increasing our full-year 2020 EPS outlook to reflect our stronger than expected second quarter results.

In Agribusiness, based on first half results, the current market environment and forward curves, our full-year results will be higher than our previous guidance, as well as last year's results.

In Edible Oils we expect modest improvement compared to our previous outlook. Despite a stronger than expected second quarter, the business will likely continue to face headwinds from COVID-19. Expected results in Milling continue to be in line with last year.

The Company expects the following for 2020: an adjusted annual effective tax rate in the upper end of the range of 19% to 23%; net interest expense of approximately $230 million; capital expenditures in the range of $375 to $400 million; and depreciation and amortization of approximately $400 million.

The outlook of the sugar and bioenergy joint venture has declined from the previous forecast to reflect the impact of foreign exchange volatility in the first half of the year.

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