ADM tells stockholders it sees sweeter days ahead

DECATUR, Nov 06, 2009 (Herald and Review - McClatchy-Tribune Information Services via COMTEX) -- ADM | Quote | Chart | News | PowerRating -- Archer Daniels Midland Co. told investors Thursday that the second half of 2009 had left a bitter taste in the mouth, but prospects may be about to turn sweeter.

Results for the first six months of the old fiscal year had been strong, buoyed by robust earnings from oilseeds and even record returns from the company's agricultural services segment.

Patricia Woertz, ADM's chairwoman, CEO and president, said things had curdled later on. "In the second half, we felt the full impact of the recession," she said, speaking during the company's annual general meeting at its Decatur headquarters. Ethanol margins tanked amid a general downturn that blighted business across the board. Net earnings for the whole year finished at $1.7 billion on essentially flat revenues of $69.2 billion.

First-quarter results for the new fiscal year announced Tuesday continued the downward trend, as profits dipped 53 percent on earnings of 77 cents a share, compared to $1.62 per share at this time last year.

Those down numbers, however, do seem to be the start of better things. Wall Street analysts had predicted the company would only make a profit of 57 cents per share. ADM also announced a cash dividend of 14 cents a share, bragging to investors this was the 78th straight year of uninterrupted dividend payments, despite financial ups and downs.

Woertz said prospects for future results look good as the world economy shows numerous signs of pulling out of the recession. She said ADM was positioning itself to take advantage of market opportunities by a strategic program of key investments.

In Decatur, she pointed to the completion of the first phase of a glycols plant that will provide yet another chemical use for starch from corn milling or glycerin produced from the company's biodiesel operations. A plant to manufacture PHA, a renewable plastic, is scheduled to start production later this year.

Across the country and across the globe, ADM has been expanding its reach and capacity. The company recently bought a mini-fleet of oceangoing cargo ships to allow it to move grain at cheaper rates. In Hazleton, Pa., it just fired up the first phase of a new cocoa processing plant, and in Europe, ADM bought chocolate manufacturer Schokinag, entering the continental chocolate market.

"Our commitment is to achieve the right results the right way, and that's what we did and what we will continue to do," Woertz told the meeting.

The shareholders gave her a round of applause and approved an executive compensation package that aims to tie rewards to overall company performance. That saw the "direct compensation" paid to Woertz in 2009 -- salary, cash incentive, equity grants -- drop by more than 32 percent to $10,890,384. The total value of all her annual compensation, including changes in pension value and deferred compensation earnings, came in at $15,466,064, off from 2008's overall figure of $17,739,017.

Shareholders, watching from the sidelines, said they were looking forward to the fried chicken lunch the company laid out after the meeting and also said they liked what ADM was serving up in terms of performance.

"Yeah, I'm happy with the way things are going," said Decatur investor Seth Gault, who was there with his wife, Ann. He said the company handled its finances well, even in tough times. "They keep the costs in line, and that is probably the No. 1 thing," added Gault, 74. "And they are quick to take advantage of new openings."

One opening appeared on the ADM board when Brian Mulroney, 69, the former Canadian prime minister, stepped down after 16 years' service, having reached the company's mandated age for retirement. Donald Felsinger, 61, who previously had been appointed to the board, formally was voted on as a new director.

treid@herald-review.com 421-7977

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