Corn Products profit falls in first quarter

by Eric Schroeder
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WESTCHESTER, ILL. —Net income at Corn Products International, Inc. in the first quarter ended March 31 totaled $94.2 million, equal to $1.23 per share on the common stock, down 39% from $153.6 million, or $2.01 per share, in the same period a year ago. The most recent quarterly results included 2c per share of business integration costs and 3c per share of restructuring costs, while last year’s results included a 75c-per-share-gain from a NAFTA settlement with the government of Mexico partially offset by 6c per share in integration costs.

Non-GAAP adjusted net income in the first quarter of fiscal 2012 was $98.2 million, or $1.26 per share, which compared with $100 million, or $1.28 per share, in the same period a year ago.

Net sales during the first quarter of fiscal 2012 totaled $1,574.2 million, up 8% from $1,459.5 million.

“We are quite pleased with the first quarter, which was the second highest quarterly adjusted e.p.s. in the company’s history,” said Ilene Gordon, chairman, president and chief executive officer. “As expected, we saw a slight decline in adjusted earnings per share in the first quarter as we lapped a very strong year-ago period that was driven by favorable input costs. Underlying our good performance is volume improvement as well as appropriate price increases to cover higher raw material costs. Our overall business fundamentals remain favorable.”

Operating income in the company’s North America segment eased 1% in the first quarter of fiscal 2012 to $100 million from $100.6 million in the same period a year ago. Net sales increased 14% to $891.8 million from $779.8 million.

In South America, operating income was $45.6 million, down 7% from $49.2 million. Net sales were virtually flat, easing to $367.5 million from $367.7 million.

Operating income in Asia Pacific climbed 6% to $20.3 million from $19.1 million on a 4% gain in sales to $189.1 million from $182 million.

In Europe, Middle East, Africa, operating income was $18.9 million, down 13% from $21.6 million a year ago. Net sales totaled $125.8 million, down 3% from $130 million in the same period of fiscal 2011.

“We continue to have a positive outlook for 2012 and expect sales and adjusted e.p.s. improvement compared to 2011,” Ms. Gordon said. “We maintain our view that the year will be somewhat back-end loaded, in contrast to 2011, which was front-end loaded. Beyond that, we are excited about the prospect of our intended name change to Ingredion, which better reflects our portfolio and business model.”

The name change is pending shareholder approval later this month.

Corn Products maintained its e.p.s. guidance of $4.84 to $5.09 for the full year, including 16c per share in acquisition and restructuring charges.

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