ADM Reports First Quarter 2012.5 Results

  ADM Reports First Quarter 2012.5 Results

 Reported EPS of $0.28 and adjusted EPS of $0.50, down from year-ago quarter

 Operating profit declined as strong Oilseeds results were offset by negative
                               ethanol margins

Business Wire

DECATUR, Ill. -- October 30, 2012

Archer Daniels Midland Company (NYSE: ADM) today reported financial results
for the quarter ended Sept. 30, 2012. The company reported net earnings for
the quarter of $182 million, or $0.28 per share, down from $0.68 per share in
the same period one year earlier. Adjusted earnings per share^1 were $0.50,
primarily reflecting a $0.16 charge related to ADM’s planned divestment of
Gruma. Segment operating profit^1 was $498 million, including a $146 million
charge related to Gruma.

“Our first-quarter segment results were mixed,” said ADM Chairman and CEO
Patricia Woertz. “Oilseeds performance was strong, the ethanol industry
experienced sustained negative margins, and Agricultural Services managed well
through a complicated quarter, challenged by the drought.

“During the first quarter, we focused on actions that will improve returns. We
made progress in our ongoing portfolio management efforts. And I’m proud of
our efforts and the results of our work to reduce costs and capital.

“As we look ahead to 2013, we are bringing online our large Paraguay soybean
processing plant as South American farmers are responding to market conditions
with record plantings, and we are implementing plans to navigate the tight
U.S. crop supply.

“Longer-term, we remain optimistic as we see continued growth in global demand
for protein meal and other agricultural products. We continue to execute our
strategy, aligning our business to serve rising demand from customers around
the world.”

First Quarter 2012.5 Financial Highlights

  *Adjusted EPS of $0.50 excludes a Gruma-related charge of $0.16 per share
    and a LIFO charge of $0.05 per share.
  *Oilseeds Processing profit increased $116 million, with year-over-year
    improvements in our crushing and origination business in all regions.
  *Corn Processing profit decreased $115 million as continued negative
    ethanol margins more than offset improved results from sweeteners and
    starches.
  *Agricultural Services profit fell $99 million, excluding the Gruma charge,
    as smaller crops reduced U.S. merchandising and handling results.
  *On track to achieve $150 million in annual run-rate savings ahead of
    schedule.

Adjusted EPS of 50 Cents, down 8 Cents

Adjusted EPS decreased primarily due to lower segment operating profit.

This quarter’s effective tax rate was 38 percent and included special factors.
Excluding these items, the effective tax rate was 30 percent, in line with
last year’s first quarter.

Oilseeds Earnings Improve Across All Three Regions

Oilseeds operating profit in the first quarter was $336 million, up $116
million from the same period one year earlier.

Crushing and origination operating profit was $256 million, up $150 million
from the year-ago quarter on strong improvements by all three geographies.
ADM’s U.S. soybean operations delivered very strong results amid good U.S.
demand and meal exports. In Europe, soybean and rapeseed crushing earnings
improved significantly.

Refining, packaging, biodiesel and other generated a profit of $28 million for
the quarter, down $27 million, with steady results in North and South America
offset by weaker European biodiesel results.

Cocoa and other results increased $27 million. Weaker cocoa press margins were
offset by the absence of last year’s significant negative mark-to-market
impacts.

Oilseeds results in Asia for the quarter were down $34 million from the prior
year’s first quarter, principally reflecting ADM’s share of the results from
its equity investee Wilmar International Limited.

Corn Processing Results Weak on Continued Ethanol Industry Challenges

Corn processing operating profit was $68 million, a decrease of $115 million
from the same period one year earlier.

Sweeteners and starches operating profit increased $64 million to $94 million,
as tight sweetener industry capacity supported higher year-over-year selling
prices. The year-ago quarter’s results were negatively impacted by higher net
corn costs related to the timing effects of economic hedges.

Bioproducts results in the quarter decreased $179 million to a loss of $26
million. Weak U.S. ethanol exports, strong Brazilian imports and slow E15
implementation kept industry margins negative.

Agricultural Services Down From Strong Prior-Year Results

Agricultural Services operating profit excluding the Gruma charge was $224
million, down $99 million from the same period one year earlier.

Merchandising and handling earnings fell $101 million to $108 million, mostly
due to weaker U.S. merchandising results impacted by the smaller U.S. harvest.

Transportation results decreased $9 million to $19 million impacted by low
barge freight utilization driven by reduced corn exports.

Milling and other results increased $11 million, excluding the Gruma charge.
Milling results remained strong, and ADM Alliance Nutrition saw improved
margins amid stronger demand.

Other Financial Results Improve

Operating profit from ADM’s Other Financial businesses was $16 million, up $21
million, with improved results from captive insurance and ADM Investor
Services.

Conference Call Information

ADM will host a conference call and audio webcast Tuesday, Oct. 30, 2012, at 8
a.m. Central Time to discuss financial results and provide a company update. A
financial summary slide presentation will be available to download
approximately 60 minutes prior to the call.

To listen to the call via the Internet or to download the slide presentation,
go to www.adm.com/webcast. To listen by telephone, dial (888) 522-5398 in the
U.S. or (706) 902-2121 if calling from outside the U.S. The access code is
31529634.

A replay of the call will be available from Oct. 31, 2012 to Nov. 6, 2012. To
listen to the replay by telephone, dial (855) 859-2056 in the U.S. or (404)
537-3406 if calling from outside the U.S. The access code is 31529634. To
listen to the replay online, visit www.adm.com/webcast.

About ADM

For more than a century, the people of Archer Daniels Midland Company (NYSE:
ADM) have transformed crops into products that serve vital needs. Today,
30,000 ADM employees around the globe convert oilseeds, corn, wheat and cocoa
into products for food, animal feed, industrial and energy uses. With more
than 270 processing plants, 420 crop procurement facilities, and the world’s
premier crop transportation network, ADM helps connect the harvest to the home
in more than 160 countries. For more information about ADM and its products,
visit www.adm.com.



Segment Operating Profit and Corporate Results((1))
A non-GAAP financial measure (unaudited)

                                         Quarter ended
                                           September 30          
                                           2012       2011^(1)   Change
                                         (In millions)
Oilseeds Processing Operating Profit                            
Crushing and origination                   $ 256        $  106       $ 150
Refining, packaging, biodiesel
                                             28            55          (27  )
and other
Cocoa and other                              29            2           27
Asia                                        23          57        (34  )
Total Oilseeds Processing                  $ 336       $  220      $ 116  
                                                                     
Corn Processing Operating Profit
Sweeteners and starches                    $ 94         $  30        $ 64
Bioproducts                                 (26  )       153       (179 )
Total Corn Processing                      $ 68        $  183      $ (115 )
                                                                     
Agricultural Services Operating Profit
Merchandising and handling                 $ 108        $  209       $ (101 )
Transportation                               19            28          (9   )
Milling and other (excl. charges)            97            86          11
Asset impairment charge                     (146 )       -         (146 )
Total Agricultural Services                $ 78        $  323      $ (245 )
                                                                     
Other Operating Profit
Financial                                   16          (5  )      21   
Total Other                                $ 16        $  (5  )     $ 21   
                                                                     
Segment Operating Profit                   $ 498        $  721       $ (223 )
                                                                     
Corporate Results
LIFO credit (charge)                       $ (53  )     $  126       $ (179 )
Interest expense - net                       (107 )        (98 )       (9   )
Unallocated corporate costs                  (70  )        (84 )       14
Debt buyback costs                           -             (4  )       4
Other                                       27          (1  )      28   
Total Corporate                            $ (203 )     $  (61 )     $ (142 )
                                                                     
Earnings Before Income Taxes               $ 295       $  660      $ (365 )
                                                                            

Total segment operating profit is ADM’s consolidated income from operations
before income tax that excludes certain corporate items. Management believes
that segment operating profit is a useful measure of ADM’s performance because
it provides investors information about ADM’s business unit performance
excluding certain corporate overhead costs. Total segment operating profit is
a non-GAAP financial measure and is not intended to replace earnings before
income tax, the most directly comparable GAAP financial measure. Total segment
operating profit is not a measure of consolidated operating results under U.S.
GAAP and should not be considered as an alternative to income before income
taxes or any other measure of consolidated operating results under U.S. GAAP.

(1) Beginning fourth quarter fiscal 2012, ADM realigned segment operating
profit to reflect a change in how the company manages its businesses. As a
result, ADM now reports Cocoa processing results as part of a new category in
Oilseeds called “Cocoa and Other” and Milling results in an Agricultural
Services category called “Milling and Other”. In addition, beginning fourth
quarter fiscal 2012, the company discontinued the allocation of working
capital interest to the operating segments. Prior periods have been restated
to conform to the current period presentation.


Consolidated Statements of Earnings
(unaudited)

                                     Quarter ended
                                       September 30
                                       2012                   2011
                                       (In millions, except per share amounts)
                                                           
Net sales and other operating          $   21,808               $   21,902
income
Cost of products sold                     21,002                 20,868  
Gross profit                               806                      1,034
Selling, general and                       (390     )               (407    )
administrative expenses
Asset impairment charge                    (146     )               -
Equity in earnings of                      113                      124
unconsolidated affiliates
Investment income                          30                       40
Interest expense                           (106     )               (113    )
Other income (expense) – net              (12      )              (18     )
Earnings before income taxes               295                      660
Income taxes                              (111     )              (199    )
Net earnings including                     184                      461
noncontrolling interests
Less: Net earnings (losses)
attributable to noncontrolling            2                      1       
interests
Net earnings attributable to ADM       $   182                 $   460     
                                                                    
Diluted earnings per common share      $   0.28                $   0.68    
                                                                    
Average number of shares                  661                    674     
outstanding
                                                                    
                                                                    
Other income (expense) - net
consists of:
Net gain on marketable securities      $   2                    $   5
transactions
Debt buyback/exchange costs                -                        (12     )
Other – net                               (14      )              (11     )
                                       $   (12      )           $   (18     )
                                                                            


Summary of Financial Condition
(unaudited)

                                              September 30,       June 30,
                                              2012               2012
                                              (in millions)
NET INVESTMENT IN
Working capital                             $ 16,538            $     16,113
Property, plant, and equipment                9,883                   9,812
Investments in and advances to affiliates     3,379                   3,388
Long-term marketable securities               246                     262
Other non-current assets                     1,098                1,137
                                            $ 31,144            $   30,712
                                                                      
FINANCED BY
Short-term debt                             $ 3,678             $     2,108
Long-term debt, including current             6,815                   8,212
maturities
Deferred liabilities                          2,210                   2,223
Shareholders’ equity                         18,441               18,169
                                            $ 31,144            $   30,712
                                                                      


Summary of Cash Flows
(unaudited)
                                                  
                                                       Three Months Ended
                                                       September 30
                                                       2012        2011
                                                       (in millions)
Operating Activities                                             
Net earnings                                         $ 184          $ 461
Depreciation and amortization                          217            207
Asset impairment charge                                146            -
Other – net                                            111            114
Changes in operating assets and liabilities           (175   )      1,305  
Total Operating Activities                             483            2,087
                                                                      
Investing Activities
Purchases of property, plant and equipment             (252   )       (443   )
Net assets of businesses acquired                      (21    )       (12    )
Marketable securities – net                            (319   )       300
Cash held in a deconsolidated entity                   -              (130   )
Other investing activities                            30           36     
Total Investing Activities                             (562   )       (249   )
                                                                      
Financing Activities
Long-term debt borrowings                              3              2
Long-term debt payments                                (1,412 )       (85    )
Net borrowings (repayments) under lines of             1,547          (663   )
credit
Debt repayment premium and costs                       -              (32    )
Purchases of treasury stock                            -              (240   )
Cash dividends                                         (115   )       (107   )
Other                                                 -            (8     )
Total Financing Activities                            23           (1,133 )
                                                                             
Increase (decrease) in cash and cash equivalents       (56    )       705
Cash and cash equivalents - beginning of period       1,291        615    
Cash and cash equivalents - end of period            $ 1,235       $ 1,320  
                                                                             

                                           
Segment Operating Analysis
(unaudited)
                                           
                                         Quarter Ended
                                          September 30
                                          2012         2011
                                          ('000s of metric tons)
Processed volumes                                   
Oilseeds                                   7,462          7,018
Corn                                       6,281          6,111
Milling and Cocoa                         1,790          1,881
Total processed volumes                   15,533         15,010
                                                          
                                           Quarter Ended
                                          September 30
                                          2012         2011
                                          (in millions)
Net sales and other operating income
Oilseeds Processing                      $ 9,688       $  9,071
Corn Processing                            3,126          3,293
Agricultural Services                      8,956          9,510
Other                                     38            28
Total net sales and other
operating income                         $ 21,808      $  21,902
                                                          


Adjusted Earnings Per Share
A non-GAAP financial measure
(unaudited)

                                                Quarter Ended
                                                  September 30
                                                  2012     2011  
Reported Earnings Per Share (fully-diluted)         $0.28    $0.68
Adjustments:
LIFO charge/(credit) (a)                            0.05        (0.11 )
Asset impairment charge (b)                         0.16        -
Brazil income tax remeasurement (c)                 0.01        -
Debt buyback/exchange costs (d)                    -          0.01  
Adjusted Earnings Per Share (non-GAAP)             $0.50      $0.58 
                                                                      

(a)   The Company’s pretax changes in its LIFO reserves during the period,
        tax effected using the Company’s U.S. effective income tax rate.
        The impairment charge related to the Company’s investments associated
(b)     with Gruma, tax effected using the applicable U.S. and Mexican tax
        rates.
(c)     The tax impact of foreign-exchange remeasurement of certain Brazilian
        assets.
        The pretax costs incurred to extinguish or modify the Company’s
(d)     outstanding debt prior to maturity, tax effected using the Company’s
        U.S. effective income tax rate.
        

Adjusted EPS is ADM’s fully diluted EPS after removal of the effect on
Reported EPS of certain specified items as more fully described above.
Management believes that Adjusted EPS is a useful measure of ADM’s performance
because it provides investors additional information about ADM’s operations
allowing better evaluation of ongoing business performance. Adjusted EPS is a
non-GAAP financial measure and is not intended to replace or be an alternative
to EPS, the most directly comparable GAAP financial measure, or any other
measures of operating results under GAAP. Earnings amounts in the tables above
have been divided by the company’s diluted shares outstanding for each
respective quarter in order to arrive at an adjusted EPS amount for each
specified item.

^1 Non-GAAP financial measures, see pages 5 and 10 for explanations and
reconciliations

Contact:

Archer Daniels Midland Company
Media Relations:
David Weintraub, 217-424-5413
or
Investor Relations:
Ruth Ann Wisener, 217-451-8286