Will Restate Previously Filed Fiscal Year 2023
Form 10-K and Subsequent Forms 10-Q
Postpones Third Quarter Conference Call
ADM (NYSE: ADM) (“the Company”) today reported preliminary
financial results for the quarter ended September 30, 2024.
Preliminary* Third Quarter 2024 Highlights
- Net earnings expected to be reported at $18 million, with
adjusted net earnings1 of $530 million
- See below for impact of non-cash charge against GAAP earnings
for the third quarter of $461 million related to our Wilmar equity
investment
- Earnings per share1 expected to be $0.04, with adjusted
earnings per share1, 2 of $1.09, both down versus the prior year
period
- Trailing four-quarter average return on invested capital (ROIC)
of 6.6%, trailing four-quarter average adjusted return on invested
capital (ROIC)1 of 8.8%
- Restatement of previously filed fiscal year 2023 Form 10-K and
subsequent Forms 10-Q not expected to materially impact results on
a consolidated basis
In regards to cash flows, our year to date cash flows from
operating activities are expected to be $2.468 billion, with cash
flows from operations before working capital1 of $2.341 billion, as
compared to cash flows from operating activities of $1.891 billion
and cash flows from operations before working capital1 of $3.804
billion for the corresponding prior-year YTD period.
“Our third quarter operating results were mixed in a challenging
quarter for the business,” said Chair of the Board and CEO Juan
Luciano.
“While Carbohydrate Solutions achieved strong results, our Ag
Services and Oilseeds and Nutrition businesses delivered results
below expectations, impacted by softer than expected market
conditions and the pace of our planned improvement efforts. We are
taking the necessary actions to improve performance and drive
continued value creation.
The integrity of our internal controls and financial reporting
is very important. We strive for accuracy and transparency in all
aspects of our business. While we have made progress we are
committed to continued strengthening of our internal financial
controls.”
_____________________________
*Results presented in this release are
preliminary and unaudited estimates based on information currently
available to the Company. Such results could differ from the final
amounts that the Company ultimately reports in its Quarterly Report
on Form 10-Q for the fiscal quarter ended September 30, 2024. The
Company assumes no obligation and does not intend to update these
estimates prior to filing its Form 10-Q for the fiscal quarter
ended September 30, 2024
1 Non-GAAP financial measures; see pages 6 and 8-12 for
explanations and reconciliations. 2 All references in this document
to earnings per share (EPS) and adjusted earnings per share reflect
EPS on a diluted basis.
Wilmar
GAAP earnings include a reduction in the carrying value of the
Wilmar equity investment to reflect the Singapore Exchange trading
price as of the balance sheet date. The reduction resulted from a
determination that declines in the valuation amount for our
investment are impaired on an “other than temporary” basis as of
the end of the quarter. This has resulted in a non-cash charge
against GAAP earnings for the third quarter of 2024 of $461
million. The Company is continuing to evaluate trends in the
trading price of our Wilmar equity investment and the potential for
future charges that could result.
Restatement
Following ongoing dialogue with the staff of the United States
Securities and Exchange Commission, the Company will amend the
Company’s fiscal year 2023 Form 10-K (the “FY2023 Form 10-K”) and
Form 10-Q for the first and second quarters of 2024 (collectively,
the “Q1 and Q2 2024 Form 10-Qs”) to restate the segment information
disclosure (Note 17 included in the FY 2023 Form 10-K and Note 13
included in the Q1 and Q2 2024 Form 10-Qs) included in those
filings. These restatements are not expected to result in any
material impact on ADM’s Consolidated Statements of Earnings,
Consolidated Statements of Comprehensive Income (Loss),
Consolidated Balance Sheets, Consolidated Statements of Cash Flow
or Consolidated Statements of Shareholders’ Equity as of and for
the periods presented. The restated filings will include
corrections for newly identified errors related to intersegment
sales (described below), will reflect the previously-corrected
errors, and will provide disclosures applicable to restated segment
information.
As previously disclosed in Note 17, Segment and Geographic
Information, to ADM’s consolidated financial statements included in
the FY2023 Form 10-K, ADM identified and corrected certain
intersegment sales amounts that either (i) were not in accordance
with prior disclosures about presenting such sales at amounts
approximating market or (ii) included intrasegment sales (resulting
from sales within the segment) and should have included exclusively
intersegment sales (resulting from sales from one segment to the
other). In connection with the error corrections, ADM identified a
material weakness in its internal control over financial reporting
related to its accounting practices and procedures for intersegment
sales. The Company put in place a plan to remediate this material
weakness, as disclosed in the FY2023 Form 10-K and Q1 and Q2 2024
Form 10-Qs.
In addition, in the course of testing new controls implemented
as part of the Company’s material weakness remediation plan in the
third quarter of 2024, ADM identified additional misclassified
intersegment transactions. These newly identified errors concern
additional intersegment sales for each of its Ag Services and
Oilseeds, Carbohydrate Solutions and Nutrition segments that
included certain intrasegment sales and should have included
exclusively intersegment sales. The Company also identified some
intersegment transactions between Ag Services and Oilseeds and
Carbohydrate Solutions that were not accounted for consistently in
accordance with revenue recognition and segment reporting standards
and should not have been reported as intersegment sales.
ADM is working to complete these restatements as soon as
reasonably practicable. The determination to restate previously
issued financial statements was made by the Company's Board of
Directors, in consultation with management and the Company's
independent registered public accounting firm. ADM is evaluating
its remediation measures and is continuing to focus on implementing
enhancements to its internal controls to remediate its previously
identified material weakness, taking action to enhance its
integrity and accuracy within internal controls and financial
reporting related to intersegment sales. Among other things, the
design and documentation of the execution of pricing and
measurement and reporting controls for segment disclosure purposes
and projected financial information used in impairment analyses
have been enhanced, and testing of these controls will continue
throughout the balance of the year. Further, training for relevant
personnel on the measurement of intersegment sales and application
of relevant accounting guidance to intersegment sales has been
provided and remains ongoing.
Preliminary Summary of Third Quarter
and Year-to-Date 2024
The following discussion summarizes preliminary earnings results
for our three reportable segments – Ag Services and Oilseeds,
Carbohydrate Solutions and Nutrition – and other and corporate
earnings information.
Ag Services and Oilseeds (AS&O)
Segment Summary (preliminary unaudited)
AS&O segment operating profit was $480 million during the
third quarter of 2024, down (43)% compared to the prior year
quarter.
The Ag Services subsegment operating profit was (53)% lower
versus the prior year quarter, primarily due to lower results in
South America Origination, as slower farmer selling and higher
logistics costs related to industry take-or-pay contracts led to
lower margins. The prior year quarter also included $48M of
insurance proceeds related to Hurricane Ida.
The Crushing subsegment operating profit was (25)% lower versus
the prior year quarter. Global soybean crush margins were higher,
supported by strong margins in EMEA. However, higher canola seed
prices due to less supply in Europe drove lower canola crush
margins, leading to lower results. During the quarter, there were
approximately zero mark-to-market timing impacts versus
approximately $100 million of positive impacts from the same period
a year ago, totaling approximately $100 million of negative net
impacts versus the prior year. The current quarter also included
$24 million of insurance proceeds for the partial settlement of the
Decatur East and West insurance claims related to incidents in
2023.
The Refined Products & Other (RPO) subsegment operating
profit was (63)% lower versus the prior year quarter, primarily
driven by lower results in North America, as higher imports of used
cooking oil and increased pre-treatment capacity drove
significantly lower refining and global biodiesel margins. During
the quarter, there were negative mark-to-market timing impacts in
RPO of approximately $20 million versus approximately $100 million
of positive timing impacts in the prior year, totaling
approximately $120 million of negative net impacts year over
year.
Equity earnings from our Wilmar equity investment were $62
million during the quarter compared to the prior year quarter of
$35 million.
Year-to-date in 2024, the AS&O segment delivered $1,803
million in segment operating profit, lower versus the elevated
prior year. Ample supplies out of South America created more
balanced supply and demand conditions, leading to a lower margin
environment in the segment. Improved segment volumes and lower
costs partially offset the impact from lower margins. Equity
earnings from our Wilmar equity investment were 20% higher versus
the comparable prior year period.
Carbohydrate Solutions Segment Summary
(preliminary unaudited)
Carbohydrate Solutions segment operating profit was $452 million
for the third quarter of 2024, down (3)% compared to the prior year
period.
The Starches & Sweeteners subsegment increased 13%, versus
the prior year period, primarily driven by strong starches and
sweeteners volumes and margins, supported by high utilization rates
across the network. The current quarter also included $47 million
of insurance proceeds for the partial settlement of the Decatur
West insurance claims related to an incident that occurred in
2023.
In the Vantage Corn Processing (VCP) subsegment, operating loss
of $(3) million was lower compared to the prior year period, driven
by higher inventories and production, leading to a lower margin
environment.
Year-to-date in 2024, Carbohydrate Solutions segment operating
profit of $1,057 million was (1)% lower than the prior year period,
as lower margins in the EMEA region and lower domestic ethanol
margins were partially offset by improved volumes and lower
costs.
Nutrition Segment Summary (preliminary
unaudited)
Nutrition segment operating profit was $105 million for the
third quarter of 2024, down (19)% compared to the prior year
period.
Human Nutrition subsegment operating profit was $86 million,
approximately (27)% lower versus the prior year period. Solid
performance by recent Flavors M&A was more than offset
primarily by lapping non-recurring benefits in Health &
Wellness in the prior year, in addition to certain other costs
including costs associated with the closure of a joint venture. The
current quarter also included $25 million of insurance proceeds for
the partial settlement of the Decatur East insurance claims related
to an incident that occurred in 2023.
In the Animal Nutrition subsegment, operating profit of $19
million was 58% higher compared to prior year quarter, as cost
optimization efforts and lower input costs supported higher
margins.
Year-to-date in 2024, Nutrition segment operating profit of $298
million was (32)% lower than the prior year period, primarily
driven by negative impacts related to unplanned downtime at Decatur
East, lower texturants margins, and higher costs in Human
Nutrition.
Other and Corporate Summary
(preliminary unaudited)
For the third quarter, Other business operating loss was $17
million, down $63 million versus the prior year, due to lower
Captive insurance results from $112 million in claim settlements.
Included in claim settlements were partial settlements of $96
million for the Decatur East and West insurance claims. ADM
Investor Services results decreased on lower interest income.
Year-to-date in 2024, Other business operating profit was $200
million, down $29 million versus the prior year, due to lower
Captive insurance results from $112 million in claim settlements.
Included in claim settlements were partial settlements of $96
million for the Decatur East and West insurance claims. ADM
Investor Services results decreased on lower interest income.
In Corporate for the third quarter, unallocated corporate costs
increased versus the prior year on $28 million in higher legal fees
and $14 million in higher financing costs, partially offset by
lower incentive compensation.
In Corporate for year-to-date 2024, unallocated corporate costs
increased versus the prior year on higher global technology
investments to support digital transformation efforts, $75 million
in increased legal fees, and $33 million in increased financing
costs, partially offset by lower incentive compensation. Other
Corporate was unfavorable compared to the prior year period due to
investment valuation losses partially offset by foreign currency
gains.
Outlook
The Company is lowering its previously provided EPS guidance for
the full year. ADM now expects adjusted earnings per share2 in the
range of $4.50 to $5.00 for the full year 2024, based on trends in
ADM’s performance to date, legislative and regulatory policy
uncertainties, and ongoing headwinds from slower market demand and
internal operational challenges.
_____________________________
3 Forecasted GAAP Earnings
Reconciliation: ADM is not presenting forecasted GAAP earnings
per diluted share or a quantitative reconciliation to forecasted
adjusted earnings per share in reliance on the unreasonable efforts
exemption provided under Item 10(e)(1)(i)(B) of Regulation S-K. ADM
is unable to predict with reasonable certainty and without
unreasonable effort the impact of any impairment and timing of
restructuring-related and other charges, along with
acquisition-related expenses and the outcome of certain regulatory,
legal and tax matters. The financial impact of these items is
uncertain and is dependent on various factors, including timing,
and could be material to our Consolidated Statements of
Earnings.
Postponed Third Quarter Conference
Call
ADM has decided to postpone the webcast originally scheduled for
November 5, 2024, at 9 a.m. Central Time as it works diligently to
finalize its financial statements. The Company expects to
reschedule the webcast to discuss the third quarter financial
results and provide a company update once it has filed the amended
FY2023 Form 10-K and the Q1 and Q2 2024 Form 10-Qs with restated
financials and the Form 10-Q for the third quarter of 2024.
About ADM
ADM unlocks the power of nature to enrich the quality of life.
We’re an essential global agricultural supply chain manager and
processor, providing food security by connecting local needs with
global capabilities. We’re a premier human and animal nutrition
provider, offering one of the industry’s broadest portfolios of
ingredients and solutions from nature. We’re a trailblazer in
health and well-being, with an industry-leading range of products
for consumers looking for new ways to live healthier lives. We’re a
cutting-edge innovator, guiding the way to a future of new consumer
and industrial solutions. And we're a leader in sustainability,
scaling across entire value chains to help decarbonize the multiple
industries we serve. Around the globe, our innovation and expertise
are meeting critical needs while nourishing quality of life and
supporting a healthier planet. Learn more at www.adm.com.
Cautionary Note Regarding
Forward-Looking Statements
This press release contains “forward-looking statements” within
the meaning of the Private Securities Litigation Reform Act of 1995
that involve substantial risks and uncertainties. All statements,
other than statements of historical fact included in this release,
are forward-looking statements. You can identify forward-looking
statements by the fact they do not relate strictly to historical or
current facts. These statements may include words such as
“anticipate,” “estimate,” “expect,” “project,” “plan,” “intend,”
“believe,” “may,” “outlook,” “will,” “should,” “can have,”
“likely,” and other words and terms of similar meaning in
connection with any discussion of the timing or nature of future
operating or financial performance or other events. All
forward-looking statements are subject to significant risks,
uncertainties and changes in circumstances that could cause actual
results and outcomes to differ materially from the forward-looking
statements. These forward-looking statements are not guarantees of
future performance and involve risks, assumptions and
uncertainties, including, without limitation, those described in
the Company’s most recent Annual Report on Form 10-K and in other
documents that the Company files or furnishes with the Securities
and Exchange Commission. Should one or more of these risks or
uncertainties materialize, or should underlying assumptions prove
incorrect, actual outcomes may vary materially from those indicated
or anticipated by such forward-looking statements. Accordingly, you
are cautioned not to place undue reliance on these forward-looking
statements, which speak only as of the date they are made. Except
to the extent required by law, ADM does not undertake, and
expressly disclaims, any duty or obligation to update publicly any
forward-looking statement after the date of this announcement,
whether as a result of new information, future events, changes in
assumptions or otherwise.
Non-GAAP Financial
Measures
The Company uses certain “Non-GAAP” financial measures as
defined by the Securities and Exchange Commission. These are
measures of performance not defined by accounting principles
generally accepted in the United States, and should be considered
in addition to, not in lieu of, GAAP financial measures.
Reconciliations of these non-GAAP financial measures to the most
directly comparable preliminary GAAP financial measures are
included in this press release. The following description of the
non-GAAP financial measures included in this release, as well as
the information included within and below the reconciliation tables
on the pages that follow, refer to GAAP and non-GAAP financial
measures on a preliminary, expected basis only.
Adjusted net earnings and Adjusted earnings per share (EPS).
Adjusted net earnings reflects ADM’s GAAP net earnings after
removal of the effect on net earnings of specified items as more
fully described in the reconciliation tables below. Adjusted EPS
reflects ADM’s fully diluted EPS after removal of the effect on
GAAP EPS of specified items as more fully described in the
reconciliation tables below. Management believes that Adjusted net
earnings and Adjusted EPS are useful measures of ADM’s performance
because they provide investors additional information about ADM’s
operations allowing better evaluation of underlying business
performance and better period-to-period comparability. These
non-GAAP financial measures are not intended to replace or be
alternatives to GAAP net earnings and GAAP EPS, the most directly
comparable GAAP financial measures, or any other measures of
operating results under GAAP. Earnings amounts described above have
been divided by the company’s diluted shares outstanding for each
respective period in order to arrive at an adjusted EPS amount for
each specified item.
Adjusted Return on Invested Capital (ROIC). Adjusted ROIC is
Adjusted ROIC earnings divided by adjusted invested capital.
Adjusted ROIC earnings is ADM’s net earnings adjusted for the
after-tax effects of interest expense on borrowings and specified
items. Adjusted invested capital is the sum of ADM’s equity
(excluding redeemable and non-redeemable noncontrolling interests)
and interest-bearing liabilities (which totals invested capital),
adjusted for specified items. Management believes Adjusted ROIC is
a useful financial measure because it provides investors
information about ADM’s returns excluding the impacts of specified
items and increases period-to-period comparability of underlying
business performance. Management uses Adjusted ROIC to measure
ADM’s performance by comparing Adjusted ROIC to its weighted
average cost of capital (WACC). Adjusted ROIC, Adjusted ROIC
earnings and Adjusted invested capital are non-GAAP financial
measures and are not intended to replace or be alternatives to GAAP
financial measures.
Cash Flows from Operations Before Working Capital. Cash flows
from operations before working capital is defined as net cash flow
provided by operating activities excluding the changes in operating
assets and liabilities as presented in the Company’s Consolidated
Statement of Cash Flows. Management believes that cash flow from
operations before working capital is a useful measure of the
Company’s cash generation. Cash flow from operations before working
capital is a non-GAAP financial measure and is not intended to
replace or be an alternative to net cash provided by operating
activities, the most directly comparable GAAP financial
measure.
Reconciliation Tables Follow
Source: Corporate Release
Source: ADM
Adjusted Net Earnings and Adjusted EPS
(Preliminary Unaudited)
Non-GAAP financial measures
(unaudited)
Quarter ended September 30
Nine months ended September
30
2024
2023
2024
2023
In millions
Per share
In millions
Per share
In millions
Per share
In millions
Per share
Net earnings and fully diluted
EPS
$
18
$
0.04
$
821
$
1.52
$
1,233
$
2.48
$
2,918
$
5.35
Adjustments:
Loss (gain) on sales of assets and
businesses (a)
(1
)
—
2
—
(1
)
—
(7
)
(0.02
)
Impairment, restructuring charges and
contingency provisions (b)
500
1.03
54
0.10
523
1.06
152
0.28
Expenses related to acquisitions (c)
—
—
3
0.01
3
0.01
5
0.01
Loss (gain) on debt conversion option
(d)
—
—
—
—
—
—
(6
)
(0.01
)
Tax adjustment (e)
13
0.02
—
—
30
0.06
3
0.01
Sub-total adjustments
512
1.05
59
0.11
555
1.13
147
0.27
Adjusted net earnings and adjusted
EPS
$
530
$
1.09
$
880
$
1.63
$
1,788
$
3.61
$
3,065
$
5.62
(a)
Current quarter and YTD gain each
of $1 million pretax and $1 million after tax, respectively, was
related to the sale of certain assets, tax effected using the
applicable tax rate. Prior quarter and YTD (gain) loss of $2
million and $(10) million pretax ($2 million and $(7) million after
tax), respectively, was related to the sale of certain assets, tax
effected using the applicable tax rate.
(b)
Current quarter and YTD charges
of $504 million and $529 million pretax ($500 million and $523
million after tax), respectively were related to the impairment of
the Company's investment in Wilmar of $461 million, impairment of
certain other assets, and restructuring, tax effected using the
applicable tax rates. Prior quarter and YTD charges of $79 million
and $141 million pretax ($60 million and $111 million after tax),
respectively, were related to the impairment of certain assets and
restructuring. Also included in the prior quarter and YTD is a
contingency loss reversal of $8 million pretax ($6 million after
tax) and a contingency provision related to import duties of $62
million pretax ($47 million after tax) in the prior YTD, tax
effected using the applicable tax rates.
(c)
Current YTD expenses of $4
million ($3 million after tax) were related to certain
acquisitions, tax effected using the Company’s U.S. income tax
rate. Prior quarter and YTD expenses of $3 million and $6 million
($3 million and $5 million after tax), respectively, were related
to certain acquisitions, tax effected using the Company’s U.S.
income tax rate.
(d)
Prior YTD gain on debt conversion
option of $6 million pretax ($6 million after tax).
(e)
Tax expense (benefit) adjustment
due to certain discrete items totaling $13 million and $30 million
in the current quarter and YTD, respectively. Tax expense (benefit)
adjustment due to certain discrete items totaling $3 million in the
prior YTD, respectively.
Adjusted net earnings reflects ADM’s GAAP
net earnings after removal of the effect on net earnings of
specified items as more fully described above. Adjusted EPS
reflects ADM’s fully diluted EPS after removal of the effect on
GAAP EPS of specified items as more fully described above.
Management believes that Adjusted net earnings and Adjusted EPS are
useful measures of ADM’s performance because they provide investors
additional information about ADM’s operations allowing better
evaluation of underlying business performance and better
period-to-period comparability. These non-GAAP financial measures
are not intended to replace or be alternatives to net earnings and
GAAP EPS, the most directly comparable GAAP financial measures, or
any other measures of operating results under GAAP. Earnings
amounts described above have been divided by the company’s diluted
shares outstanding for each respective period in order to arrive at
an adjusted EPS amount for each specified item.
Adjusted Return on Invested Capital
(Preliminary Unaudited)
A non-GAAP financial measure
(unaudited)
ROIC Earnings (in millions)
Four Quarters
Quarter Ended
Ended
Dec. 31, 2023
Mar. 31, 2024
Jun. 30, 2024
Sep. 30, 2024
Sep. 30, 2024
Net earnings attributable to ADM
$
565
$
729
$
486
$
18
$
1,798
Adjustments:
Interest expense
109
115
135
124
483
Tax on interest
(26
)
(27
)
(32
)
(30
)
(115
)
Total ROIC Earnings
$
648
$
817
$
589
$
112
$
2,166
Total ROIC Earnings
$
648
$
817
$
589
$
112
$
2,166
Other Adjustments
155
21
22
512
710
Total Adjusted ROIC Earnings
$
803
$
838
$
611
$
624
$
2,876
Invested Capital (in millions)
Quarter Ended
Trailing Four
Dec. 31, 2023
Mar. 31, 2024
Jun. 30, 2024
Sep. 30, 2024
Quarter Average
Equity (1)
$
24,132
$
23,219
$
22,148
$
21,974
$
22,868
+ Interest-bearing liabilities (2)
8,370
9,995
10,576
10,051
9,748
Total Invested Capital
$
32,502
$
33,214
$
32,724
$
32,025
$
32,616
Total Invested Capital
$
32,502
$
33,214
$
32,724
$
32,025
$
32,616
Other Adjustments
155
21
22
512
178
Total Adjusted Invested Capital
$
32,657
$
33,235
$
32,746
$
32,537
$
32,794
Return on Invested Capital
6.6
%
Adjusted Return on Invested
Capital
8.8
%
(1) Excludes noncontrolling interests
(2) Includes short-term debt, current
maturities of long-term debt, finance lease obligations, and
long-term debt
ROIC is ROIC earnings divided by invested
capital. ROIC earnings is ADM’s net earnings adjusted for the
after-tax effects of interest expense on borrowings. Invested
capital is the sum of ADM’s equity (excluding noncontrolling
interests) and interest-bearing liabilities.
Adjusted ROIC is Adjusted ROIC earnings
divided by adjusted invested capital. Adjusted ROIC earnings is
ADM’s net earnings adjusted for the after-tax effects of interest
expense on borrowings, and specified items. Adjusted invested
capital is the sum of ADM’s equity (excluding noncontrolling
interests) and interest-bearing liabilities adjusted for the
after-tax effect of specified items. Adjusted ROIC on a trailing
four quarter average basis is equal to the average trailing four
quarters of adjusted ROIC earnings divided by the average trailing
four quarters of adjusted invested capital. Management believes
Adjusted ROIC is a useful financial measure because it provides
investors information about ADM’s returns excluding the impacts of
specified items and increases period-to-period comparability of
underlying business performance. Management uses Adjusted ROIC to
measure ADM’s performance by comparing Adjusted ROIC to its
weighted average cost of capital (WACC). Adjusted ROIC, Adjusted
ROIC earnings and Adjusted invested capital are non-GAAP financial
measures and are not intended to replace or be alternatives to GAAP
financial measures.
Adjusted Earnings Before Interest,
Taxes, and Depreciation and Amortization (EBITDA) (Preliminary
Unaudited)
A non-GAAP financial measure
(unaudited)
The tables below provide a reconciliation
of net earnings to adjusted EBITDA for the trailing four quarters
ended September 30, 2024.
Four Quarters
Quarter Ended
Ended
Dec. 31, 2023
Mar. 31, 2024
Jun. 30, 2024
Sep. 30, 2024
Sep. 30, 2024
(in millions)
Net earnings
$
565
$
729
$
486
$
18
$
1,798
Net earnings (losses) attributable to
noncontrolling interests
(23
)
(10
)
(5
)
—
(38
)
Income tax expense
192
166
115
90
563
Interest expense
109
115
135
124
483
Depreciation and amortization
277
280
286
288
1,131
EBITDA
1,120
1,280
1,017
520
3,937
(Gain) loss on sales of assets and
businesses
(7
)
—
—
(1
)
(8
)
Impairment and restructuring charges and
contingency provisions
172
18
7
504
701
Railroad maintenance expense
39
—
4
28
71
Expenses related to acquisitions
1
—
4
—
5
Adjusted EBITDA
$
1,325
$
1,298
$
1,032
$
1,051
$
4,706
EBITDA is defined as earnings before
interest, taxes, depreciation and amortization. Adjusted EBITDA is
defined as EBITDA, adjusted for specified items. The Company
calculates adjusted EBITDA by removing the impact of specified
items and adding back the amounts of income tax expense, interest
expense on borrowings, and depreciation and amortization to net
earnings. Management believes that EBITDA and adjusted EBITDA are
useful measures of the Company’s performance because they provide
investors additional information about the Company’s operations
allowing better evaluation of underlying business performance and
better period-to-period comparability. EBITDA and adjusted EBITDA
are non-GAAP financial measure and are not intended to replace or
be an alternative to net earnings, the most directly comparable
GAAP financial measure.
Cash Flows from Operations Before
Working Capital (Preliminary Unaudited)
A non-GAAP financial measure
(unaudited)
Nine months ended
September 30
2024
2023
(in millions)
Net Cash Provided by Operating
Activities
$
2,468
$
1,891
Net Cash (Used) by Investing
Activities
(2,002
)
(1,061
)
Net Cash (Used) by Financing
Activities
(1,465
)
(2,800
)
Net Cash Provided by Operating
Activities
2,468
1,891
Less: Changes in operating assets and
liabilities (1)
127
(1,913
)
Cash Flows from Operations Before Working
Capital
$
2,341
$
3,804
(1) Operating assets and
liabilities include trade receivables, inventories, other current
assets, trade payables, accrued expenses, segregated investments
and brokerage payables.
Cash Flow from Operations Before Working
Capital. Cash flows from operations before working capital is
defined as net cash provided by operating activities excluding the
changes in operating assets and liabilities as presented in the
Company’s Consolidated Statement of Cash Flows. Management believes
that cash flow from operations before working capital is a useful
measure of the Company’s cash generation. Cash flow from operations
before working capital is a non-GAAP financial measure and is not
intended to replace or be an alternative to net cash provided by
operating activities, the most directly comparable GAAP financial
measure.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20241104262002/en/
Media Contact Brett Lutz media@adm.com 312-634-8484
Investor Relations Megan Britt Megan.Britt@adm.com
872-257-8378
Archer Daniels Midland (NYSE:ADM)
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Archer Daniels Midland (NYSE:ADM)
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