REUTERS — Agricultural chemical and seed company Corteva beat Wall Street estimates for fourth-quarter profit.
Higher prices in its seeds business offset lower volumes and the company announced plans to repurchase nearly $1 billion shares in 2024.
The Indianapolis-based company also forecast higher net sales in 2024, in the range of $17.4 to $17.7 billion, as it banked on demand for grain, oilseeds and biofuels.
Though global crop prices have fallen from last year, they remain elevated compared to historical averages so farmers have more cash.
Corteva, spun off in 2019 after a merger of Dow Chemical and Dupont, reported net sales of $17.23 billion in 2023, within the $17 to $17.3 billion range that the company had forecasted.
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Net sales were at $3.71 billion for the quarter ended Dec. 31.
Sales from the seed business were $1.64 billion, down 0.6 percent due to lower volumes as farmers delayed purchases due to unfavourable weather in Brazil.
This was offset by higher seed prices led by North American and European markets, and increased corn acres in North America.
For the crop protection segment, Corteva’s reported net sales were nearly five percent lower on falling volumes and prices, especially in Latin America, and channel inventory destocking.
Brazil’s drought caused farmers to delay fertilizer purchases for corn planting, denting sales for global fertilizer suppliers including Corteva, which had to sell its Brazilian stock at a discount due to tepid demand.
In 2024, crop markets may face tighter supplies due to adverse El Nino-related weather effects, export restrictions and higher biofuel mandates, analysts said.
The operating core profit was 15 cents per share, compared with average analysts’ estimates of six cents.
