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Monsanto faces new challenges
May. 31, 2009
Monsanto Co. disappointed investors on Wednesday by saying it would only meet the lower end of its earnings outlook for the year as stiff competition in the herbicide segment and adverse weather conditions hurt sales.
As cooler, wetter weather in parts of the U.S. postponed the use of Roundup and other glyphosate products, the agribusiness giant lowered its outlook for gross profit at the segment to $2 billion from a previous view of $2.4 billion. Monsanto also said "generic and other branded competitors continue to aggressively move larger-than-expected volumes of lower-priced material."
The company now expects to earn about $4.40 per share in fiscal 2009, the lowest point of its forecasted range of $4.40 to $4.50. For the year ending in August, 11 analysts on an average had estimated a profit of $4.62 a share. Monsanto is due to release its fiscal third-quarter results June 24.
Shares of the company were down more than 5% to $80.32 at noon on the New York Stock Exchange.
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