Higher costs hit Cargill’s Q3 protein division earnings

CARGILL has said its animal nutrition and protein division’s results declined in part because of higher costs at its poultry processing joint ventures in the UK and the Philippines.

The division was the largest contributor to Cargill’s adjusted operating earnings in the company’s fiscal 2019 Q3 results, it said.

It noted that earnings in North American protein “exceeded the year-ago period, boosted by continued strong domestic and export demand for beef as well as consumer demand for egg products”.

But it went on to say higher production costs at poultry processing joint ventures in the Philippines and UK contributed to a decline in global poultry results.

The UK joint venture is between Cargill and Faccenda Foods, which together trade as Avara Foods.

Acquisition

Cargill also said two recently aquired value added chicken processors, Campollo in Colombia and Konspol in Poland had “both got off to a good start as part of Cargill”.

Overall, the firm posted 8% growth in adjusted operating earnings, to $604m, making the first nine months revenue $2.34bn.

Total third-quarter revenues decreased 4% to $26.9bn, bringing the year-to-date figure to $83.5bn.

Dave MacLennan, Cargill’s chairman and chief executive officer said: “We remain focused on our growth objectives.

“To achieve them, we are innovating what matters for our customers so they can win with consumers in local markets.”