Monsanto Company has announced that gross profit for the 2015 first quarter decreased to $1.4 billion from the prior year.
As previewed in the fourth quarter of fiscal year 2014, the decline in gross profit in the quarter is largely due to fewer corn acres in South America and in cotton in Australia. The company reports that the fewer acres combined with a timing shift, as the company moves more of its agricultural productivity business to branded-product sales that historically occur more in the third quarter, has led to the decrease.
With the expectation of fewer global corn acres, the seeds and genomics gross profit growth percentage for the year is now expected to be more in the range of high single digits. Monsanto continues to see its next-generation soybean technologies as critical in delivering gross profit growth in the segment for the fiscal year, as underscored by the more than $100 million in gross profit growth and seven points of margin lift in soybeans in the first quarter.
“The near-term headwinds in agriculture persist, but our ability to deliver new solutions to help farmers improve yields while efficiently using resources provides the opportunity to deliver growth in both the current environment and over the longer-term,” says Hugh Grant, Monsanto CEO.
