Bunge reports lower Q3 earnings amid global margin challenges

Bunge Global SA released its third-quarter results for 2024, reporting a GAAP diluted earnings per share (EPS) of $1.56, down from $2.47 in the same period last year. When adjusted for certain gains, charges, and mark-to-market timing differences, the EPS was $2.29, a decrease from $2.99 in Q3 2023.

Despite these declines, the company noted solid performances in its Agribusiness and Refined and Specialty Oils segments, although the overall results were impacted by a challenging global margin environment. CEO Greg Heckman highlighted the company's adaptability, stating, “Our team delivered a strong third quarter, staying nimble and leveraging our global platform to capture opportunities against shifting market dynamics around the world.”

Key financial highlights

• Revenue decline: The decrease in EPS reflects broader challenges in the market, with significant implications for agricultural producers.
• Investment and integration: Bunge is advancing its integration planning for Viterra, alongside closing the sale of its sugar and bioenergy joint venture, which aims to streamline operations and focus on core agricultural sectors.
• Share repurchases: The company repurchased $200 million in common shares during the quarter, bringing the year-to-date total to $600 million, a move aimed at returning value to shareholders.

Outlook for 2024

Bunge adjusted its full-year EPS outlook, now expecting it to be at least $9.25. The forecast for Agribusiness shows slight improvements from prior expectations, although still down compared to the previous year. The Refined and Specialty Oils segment is expected to improve, though it too will fall short of last year’s record performance.

Heckman emphasized the importance of these developments for agricultural producers: “This research will benefit growers, commodity groups, agricultural businesses, and U.S. consumers who rely on ARS to find solutions to agricultural and environmental problems.”

Tax and cost implications

For the first nine months of 2024, Bunge reported an income tax expense of $236 million, significantly lower than the $495 million recorded in the previous year, attributed to lower pre-tax income. The company also highlighted substantial costs in irrigation and equipment, with capital expenditures expected to reach $1.2 to $1.4 billion.

Segment performance

The Agribusiness segment faced various pressures, with moderate drought conditions and supply chain issues impacting agricultural output. The report indicates that while water scarcity continues to challenge farming practices, Bunge's diversification across geographies and crops, especially with the anticipated combination with Viterra, will position the company for future resilience.

Conclusion

Bunge's third-quarter performance reflects both the challenges and opportunities facing the global agricultural landscape. With strategic investments and a focus on core operations, the company aims to enhance its competitive edge while addressing the pressing issues of climate change, resource scarcity, and market dynamics. As the integration with Viterra progresses, Bunge is poised to strengthen its impact on agricultural production and support the industry's ongoing evolution.