ADM Reports Improved Q2 Earnings For Ethanol
ADM on July 30 released second quarter results, reporting improved ethanol margins supported by robust demand for fuel ethanol in both domestic and export markets. Stronger margins are currently expected to continue into the third quarter.
ADM’s ethanol operations are reported under the company’s Carbohydrates Solutions segment, which reported operating profit of $357 million for the second quarter, up 12% when compared to the same period of 2023. The Vantage Corn Processing subsegment, which consists of the company’s dry mills, reported $34 million in operating profit, up 89%. ADM attributed the increase to higher ethanol margins supported by strong demand for exports.
During a second quarter earnings call, ADM President and CEO Juan Luciano said ethanol margins improved during the second quarter as industry production tried to keep pace with robust export and domestic demand.
ADM Senior Vice President and Interim Chief Financial Officer Ismael Roig noted that ethanol markets became more constructive at the end of the second quarter, with lower stocks firming up both domestic and export margins. He said demand for ethanol remained robust, supported by the U.S. summer driving season, solid domestic blending rates and export demand. Moving into the third quarter, Roig said ADM expects solid demand for ethanol to continue both domestically and in export markets. Upside opportunities could be presented if fundamentals hold, he continued.
Overall, ADM reported earnings before taxes of $596 million, down 47% when compared to the same period of last year due to lower pricing and execution margins as well as higher corporate unallocated costs. Adjusted segment operating profit was $1.021 billion, down 37%. Adjusted earnings per share were $1.03, down 46%.
Source Link : https://ethanolproducer.com/articles/adm-reports-improved-q2-earnings-for-ethanol
