Archer Daniels Midland 2009 Annual Report Download - page 30

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24
Item 7.
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS (Continued)
Selling, general and administrative expenses of $1.4 billion were comparable to 2008. Decreased employee-related
costs and favorable impacts from foreign currency translation were offset by increases in provisions for doubtful
accounts.
Other (income) expense – net decreased $344 million primarily due to decreased results from equity earnings of
unconsolidated affiliates of $270 million, and decreased investment income. Equity earnings in unconsolidated
affiliates included $275 million of foreign exchange derivative losses incurred by the Company’s equity investee,
Gruma S.A.B. de C.V.
Operating profit by segment is as follows:
2009
2008
Change
(In millions)
Oilseeds Processing
Crushing & Origination
$ 767
$ 727
$ 40
Refining, Packaging, Biodiesel & Other
265
181
84
Asia
248
132
116
Total Oilseeds Processing
1,280
1,040
240
Corn Processing
Sweeteners & Starches
500
557
(57)
Bioproducts
(315)
404
(719)
Total Corn Processing
185
961
(776)
Agricultural Services
Merchandising & Handling
832
873
(41)
Transportation
162
144
18
Total Agricultural Services
994
1,017
(23)
Other
Wheat, Cocoa, Malt & Sugar
51
217
(166)
Financial
(57)
206
(263)
Total Other
(6)
423
(429)
Total Segment Operating Profit
2,453
3,441
(988)
Corporate
81
(817)
898
Earnings Before Income Taxes
$ 2,534
$2,624
$ (90)
Oilseeds Processing operating profit increased 23% to $1.3 billion. Crushing and origination results increased $40
million. Improved global crushing margins were partially offset by lower fertilizer sales volumes and margins and
lower North American crushing volumes due to decreased demand for vegetable oil and protein meal. Refining,
packaging, biodiesel and other results increased $84 million due principally to higher biodiesel sales volumes in
South America and increased average margins for value-added products. 2008 results for refining, packaging,
biodiesel and other included asset abandonment charges of $27 million. Asia results increased $116 million due
principally to the Company’s share in improved operating results of Wilmar International Limited.
Corn Processing operating profits decreased 81% to $185 million. Sweeteners and starches decreased $57 million
due to the impact of higher net corn costs partially offset by higher average sweetener and starches selling prices.
Bioproducts operating profit decreased $719 million for the year as ethanol and lysine margins declined
significantly due to higher corn costs and lower average selling prices. Ethanol margins were also impacted by
lower demand for gasoline, decreased gasoline prices, and excess ethanol industry capacity.