st seed company, Monsanto, has reported a drop in profit for its third quarter of the year, but its results were ahead of forecasts. The company said it plans to double earnings over the next five years.Monsanto, which makes genetically-engineered corn and soybeans, said earnings for its third quarter (ending 31 May), were down due to competitive market conditions, but it felt the overall outlook for the future was bright.
"We're on track for seeds and traits to drive a majority of our full year growth," said Chairman Hugh Grant. "That performance in a more challenging agricultural environment speaks to the breadth and customer value of our product portfolio."
Grant said that by the end of fiscal 2019, the company aimed to at least double full-year ongoing earnings, which exclude certain special after-tax items. More than $4 billion of total gross profit growth will come from its core seeds and traits unit, the company said. The company also raised the low end of its full-year outlook for ongoing earnings to $5.10 a share from $5.00 while keeping the high end at $5.20.
“The confidence level is off the charts," said John Roberts, executive director of U.S. chemical equity research at UBS. "They feel they have as deep a growth pipeline as they’ve had in a long time.”
The company’s largest profit sector, corn seed products, will continue to be a growth driver in the future, the company said. This quarter corn contributed $1.3bn.
