WHITE PLAINS, N.Y. -- Agribusiness and food company Bunge Ltd.'s third-quarter net income more than doubled as revenue rose on strength in its agribusiness division.
The company's performance missed Wall Street's expectations as it continues to deal with the impact of the severe U.S. drought this year, but the earnings growth was welcomed.
The bad weather in the U.S. and other parts of the world have hurt crops this year. Bunge said Thursday that crop supplies need to approach record levels to rebuild stocks.
"The current market environment, shaped most notably by the severe U.S. drought, has been and will continue to be volatile and complex for everyone who participates in our industry," Chairman and CEO Alberto Weisser said in a statement.
Weisser said there are early signs that soybean production will be at record levels.
"As new crops are harvested, we should see a more balanced supply-demand situation, which will be good for consumers and for the market overall," he said.
For the period ended Sept. 30, earnings rose to $289 million, or $1.92 per share. A year earlier the company earned $140 million, or 89 cents per share.
Stripping out an impairment charge of 16 cents per share, earnings were $2.08 per share.
Analysts forecast higher earnings of $2.17 per share.
Still, the quarter is the first earnings increase since the first quarter of 2011.
Bunge's stock gained $1.85, or 2.7 percent, to $70.13 in morning trading on Thursday. The shares have traded in a 52-week range of $55.64 to $71.
Revenue climbed to $17.29 billion, up 11 percent from $15.62 billion a year ago. Wall Street expected $17.75 billion.
The company's agribusiness unit enjoyed better oilseed processing results in North America, Europe and Asia and a solid performance from South America. Grain merchandising operations were helped by strong export demand and large South American grain supplies.
The performance of the sugar and bioenergy division weakened as it dealt with declining sales volumes because of port congestion and lower sugar content of harvested cane. This led to reduced production volumes and higher unit costs. The division was also burdened by a $39 million impairment charge related to a North American corn ethanol joint venture.