Monsanto Q4 Loss Narrows; Expects To Grow EPS Into FY17 And Beyond

(RTTNews) - Monsanto Co. (MON) reported that its net loss attributable to the company for the fourth quarter of fiscal year 2016 narrowed to $191 million or $0.44 per share from $495 million or $1.06 per share in the same period last year.

The company expects to grow earnings per share into fiscal year 2017 and beyond by building upon the achievements of fiscal year 2016, together with continued strong penetration of key soybean traits, global corn germplasm upgrades and spend discipline.

For the fourth quarter, the company reported $0.44 loss per share on an as-reported basis which translated to $0.07 earnings per share on an ongoing basis. The as-reported loss includes environmental and litigation matters, restructuring expenses and Argentine-related tax matters. The ongoing EPS results were better than fiscal year 2015, driven by the $157 million gain from the formation of the sorghum joint venture with Remington, a strong start in South America and lower seed returns in the U.S.

Quarterly net sales grew to $2.56 billion from $2.36 billion in the prior year.

For fiscal year 2017, Monsanto expects to achieve earnings per share of $3.83 to $4.35 on an as-reported basis. This includes an estimated $0.20 to $0.24 in anticipated restructuring charges, $0.10 to $0.13 in Argentine-related tax matters and $0.27 to $0.34 in proposed Bayer transaction related costs. On an ongoing basis, this translates into an earnings per shareestimate of $4.50 to $4.90. These estimates assume currencies are relatively stable year-over-year.

The company said its restructuring and cost-savings plans are on-track, with an opportunity to deliver approximately $380 million in annual savings in operating expenses and cost of goods sold at the close of 2017. However, overall operating expenses in 2017 are expected to increase slightly with inflation and the costs associated with the return to growth. This is expected to more than offset the savings from restructuring and cost-savings plans.

The company reiterated confidence in the timelines to close the deal with Bayer by the end of calendar year 2017.