Lancaster farming. (Lancaster, Pa., etc.) 1955-current, April 23, 1994, Image 67
Dekalb Genetics Reports Second-Quarter Earnings DEKALB, 111. Dekalb Gene tics Corporation recently reported' unproved revenues for the second fiscal quarter, driven by higher sales of U.S. com and soybean seed, as well as swine breeding stock. However, net earnings for the quarter were lower than the previous year primarily because of higher com production costs af fecting both U.S. and international seed margins. For the quarter ended February 28, 1994, net earnings were $5.7 million, or $1.09 per share, com pared with $7.1 million or $1.38 per share, in the same period last year. Revenues for the quarter rose 9 percent to $143.0 million from $131.4 million. Earnings for the quarter included an after-lax benefit of $ 1.0 million, or 20 cents per share, resulting from the com pany’s decision to suspend the de fined benefit portion of its retire ment program. - “As we have previously indicat ed, higher production costs relat ing to last summer’s crop have significantly lowered unit margins for U.S. seed com,” said Bruce P. Bickner, chairman and chief exe cutive officer.’These production costs have also affected interna tional results, reducing volume and profitability of U.S.-sourced seed for export markets. “Although higher com costs have posed a challenge, we are otherwise very pleased with the Heavy duty single-phase “Hi They are ideally suited Torque" motors designed for tough applications -specifically for severe farm duty , such as pumps applications. These capacitor conveyors poultry start/mduction run motors equipment and other provide high starting torque, farm duty machinery while requiring only normal SHAFT CATALOG PRICE HP RPM FRAME DIA. VOLTAGE NUMBER $ 75 1/3 1725 C 56 5/8 115/208-230 113256 $ 80 1/2 1725 C 56 5/8 115/208-230 110086 $lOO 3/4 1725 D 56 5/8 115/208-230 110087 $ll5 1 1725 E 56 5/8 115/208-230 110088 $135 V/2 1725 HS6H 5/8 115/230 110089 $155 2 1725 JS6HZ 7/8 230 110090 $2OO 2 1740 EIB2T 1 1/8 115/208-230 130042 $230 3 1740 JIB4T 1 1/8 230 130043 $2BO 5 1740 LIB4T 1 1/8 230 130044 EXTRA HI-TORQUE RATED $345 5 1740 H2IST 1 3/8 230 140203 $375 Th 1740 K2IST 1 3/8 230 140130 $520 10 1740 L2IST 1 3/8 230 140414 PRICES EFFECTIVE UNTIL APRIL 29, 1994 AC LI LI 255 plane tree drive CIIJnCY LANCASTER, PA 17603 ■ EQUPMENT CO. (717) 393 " 5807 We Customer Satisfaction TersonaUy performance of our North Ameri can seed business,” he said. “We are seeing excellent demand for our seed com this season, with se veral varieties having been sold out. In addition, the pace of soy bean sales has been exceptional.” Bickner noted that North Ameri can and European seed results are primarily realized in the second and third quarters. Thus, the com bined total of the two quarters is the best indicator of seed results. “Our swine business is also having a good year, with breeding stock sales running significantly ahead of lasi year,” Bickner said. “Demand continues to be very strong for the product lines we in troduced last summer.” For the first six months of the fiscal year, Dekalb reported net earnings of $6.6 million, or $1.27 per share, down from $7.9 million, or $1.53 per share, in the same period last year. Revenues were up 3 percent to $183.8 million from $179.3 million. Year-to-date earnings included an after-tax benefit of $1.6 million, or 32 cents per share, related to the pension changes. However, Dekalb also recorded an after-tax charge in the first quarter of $300,000, or S cents per share, resulting from the adoption of the new standard for accounting for income taxes. Ex cluding these non-recurring items, net earnings for the first six months were down $2.6 million. or SO cents per share. “The single largest factor af fecting six-month results was low er earnings in Argentina.” Bickner said./“Argentine earnings declined 46 percent from last year’s record levels because of lower planted acreage, lower sunflower prices, and higher crop costs. However, these should not be long-term situations. We have an exception al product line, and we recently completed a major plant expan sion, updating our com drying and conditioning equipment to help support our clear leadership posi tion in the Argentine market.” Second-quarter revenues for the seed business rose 8 percent to $125.2 million, compared with $116.1 million in the same period last year. However, segment earn ings declined 30 percent to $9.6 million from $13.7 million last year. “Our U.S. seed com production volume in 1993 was only 50 per cent of the previous year, which is the major contributor to lower unit margins,” Bickner said. “In addi tion, our average seed com price is down because of an unfavorable seed size mix and early cash re mittances. These factors combin ed to cause 14 percent lower U.S. com unit margins.” Six-month revenues of $148.4 million were about flat with the previous year’s $147.9 million. Segment earnings were $12.4 mil lion, down 28 percent from $17.2 million in the prior year. “Clearly. U.S. farmers are plan ning to plant significantly more com this spring, as indicated by the recent USDA planting inten tions report,” Bickner said. “At Dekalb, this is being reflected in increased dealer and sales activity, larger average order sizes and higher cash collections. There are also solid indications that we are continuing to make further pro gress with large operators—a key focus of our business. These fac tors lead us to be encouraged about 1994 com sales. We expect, however, that our seed com sales recorded in the first half of this fis cal year will represent a smaller portion of full-year sales than was the case in the prior year, when we had an abnormally Ugh rate of re turned goods in the last half of the fiscal year.” Revenues for Dekalb Swine Breeders rose 22 percent in the second quarter to $13.2 million from $lO.B million. Segment earn ings increased to $900,000 from $600,000 in the same period last year. For the six months, Dekalb Swine recorded revenues of $26.2 million, up 23 percent from $21.3 million the prior year. Segment earnings rose to $2.7 million from $1.3 million. “Breeding stock sales volume HTRAPLUS HUMATE PROMOTE EARLY ROOT GROWTH ON CORN & SOYBEANS Cool, wet soils make nutrients unavailable, slowing down root development and early growth. NUTRA PLUS HUMATE 12% added to starter or side-dress fertilizers will stimulate root growth, making both macro and trace elements more available ▼ MAKES SOIL NUTRIENTS MORE AVAILABLE A ▼ 100% ORGANIC ▼ PROMOTES ROOT GRi ON WHEAT, VEGETAB' ROW CROPS C CUSTOM CHEMICIDES CALL LEBANON AGRICORP AND ASK HOW THIS RICH, ORGANIC MATERIAL CAN IMPROVE THE PERFORMANCE OF MOST OF YOUR FERTILIZERS. Lancaster Firming, Saturday, April 23, 1994-C7 to date is IS percent over the pre vious year, and bookings are strong for the months ahead,” Bickner said. “However, our cost of sales is higher because of high feed costs and the fact that we are building inventory at new produc tion facilities.” Second-quarter revenues for the company’s poultry operation were $4.6 million, about even with last year. Dekalb Poultry posted a $500,000 operating loss for the quarter, compared with a $200,000 loss in the same period last year. Year to date, revenues declined 9 percent to $9.2 million from $lO.l million. Dekalb Poul try recorded an operating loss of $700,000, compared with a loss of $400,000 in the First six months of last year. ‘The lower results are due pri marily to reduced exports,” Bick ner said. ‘Two situations in parti cular are taking their toll: an em bargo against poultry imports into Venezuela and a lack of U.S. dol lars in Bulgaria. Unfortunately, it is difficult to determine when eith er of these situations might im prove.” 12%