MON 2009 Q2 Earnings - by BetterTrades

As the world's largest seed producer, Monsanto Co. (MON) made it known before the opening bell Thursday morning that the company's profits for the 2nd quarter declined, despite an increase in sales of corn and soybean seeds.

Monsanto, a global leader in the development of genetically altered crops, confirmed that earnings for the quarter came in at $1.09B, or $1.97 per share, compared to earnings of $1.13B, or $2.02 per share, a decrease in income of 3.5%.

Quarterly results were impacted by a one-time charge of $162M, or $0.19 per share related to research and development tied to the acquisition of a sugarcane breeding and technology company located in Brazil. Excluding these charges, Monsanto would have posted a 2nd quarter profit of $2.16 per share.

Meanwhile, the company's sales for the period came in at a record $4.04B, up more than 8% from last year's total revenues of $3.73B. The company's overall sales figures were bolstered by an increase in revenues from both its U.S. branded corn seeds and traits business and their soybean seed and traits business.

"Corn and soy remain the foundation of the company, and that continues to do well," stated Mark Gulley, analyst at Soleil Securities.

Delving deeper into the company's sales numbers, Monsanto recorded gross sales of $3B in their seed and genomics business. That is up more than 20% from the previous year, despite the decline in the company's sales of Roundup and other herbicides, which plunged nearly 21% over last year's 2nd quarter.

The company's lack of sales for Roundup was not the only segment of business that did not fare well from last year, as the agricultural productivity division saw a decline in sales of 5.7%, recording overall revenues of $544M.

In relation to Monsanto's $3B in sales of seed and genomics, corn seed revenues advanced 19%, while sales of soybean seeds contributed to gross sales with an increase of 35% year-over-year.

On average, analysts were anticipating that the crop technology company would post quarterly earnings of $2.07 per share on overall sales totals of $4.14B, excluding one-time charges.

"Through the first half of the year, we've done what we had committed to do: We've preserved value across the portfolio, which has allowed us to lift gross profit by 25%, margins by 5%, and ongoing earnings by 41%," announced Monsanto's CEO Hugh Grant after releasing the company's quarterly report.

Looking forward to the remainder of the year, Monsanto is anticipating full-year earnings to be in the range between $4.23 and $4.33 per share on a reported basis. However, on an on-going basis, the company is looking to post yearly earnings within a range between $4.40 and $4.50 per share.

Analysts are looking for Monsanto to post annual earnings of $4.65 per share.

After falling $2.83 to open Thursday's trading session, shares of Monsanto rebounded throughout the day to end the session just below breakeven. At the close, MON was lower by 0.4%, adding $0.33, to conclude the day at $81.41 per share. Shares reached an intraday high of $85.75 before retracing.

By BetterTrades