Monsanto reports "record" first quarter sales

By Lorraine Heller

- Last updated on GMT

Related tags: Soybean

Agricultural products giant Monsanto today reported strong first
quarter sales, on the back of a good performance from its seeds and
genomics segment.

The firm, which said it is "off to a good start" for the 2006 financial year, reported net sales of $1.4 billion, a 31 percent increase from last year's figure of just over $1 billion.

However, this figure also includes sales from its recently acquired Seminis vegetable and fruit seed business, which did not contribute to last year's results. But even without the $125 million brought in from this business, the biotech firm still enjoyed a strong sales increase of 19 percent for the quarter.

According to the company, key drivers for the quarter were stronger adoption of its stacked cotton traits in Australia, stronger-than-expected purchases of Roundup herbicides in the United States, Europe and Argentina, and increased U.S. corn trait revenues.

"The first quarter, while historically a smaller part of our overall financial results for the year, represents a positive starting point for our business this fiscal year. And, with the most significant part of our annual business cycle still to come, we believe we are on track for another strong fiscal year for our business,"​ said Monsanto chairman and chief executive officer Hugh Grant.

Monsanto said it expects its second and third quarters to be the primary drivers for its 2006 earnings-per-share (EPS) results, confirming that the year's EPS guidance will be towards the upper end of its previously announced range of $2.35 to $2.50.

But a good overall performance was slightly dampened by a decline in sales of soybeans, which were down 4 percent to $173 million compared to the same time last year. This perhaps explains why the company has lately concentrated efforts on its soy activities.

Monsanto recently teamed up with soy ingredients supplier Solae to develop a new line of soy proteins that claim to have a better taste and higher level of solubility than any other soy protein on the market.

The company also has several new varieties of its Vistive soybean in the pipeline, the first of which, Vistive mid-oleic, is due to be developed by 2009. Vistive Omega-3 should be ready by 2011-2012, while the company's Vistive low saturates bean, which it claims will provide products with "a heart-healthy combination of lower saturated fats, lower trans fats and improved stability," will be ready by around 2012-2013.

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