(Recasts; adds CEO quotes, updates share price)
By Karl Plume
CHICAGO Feb 7 U.S. agricultural trader Archer
Daniels Midland Co said on Tuesday it expects to
benefit from several major policy changes proposed by President
Donald Trump and believes it can adjust to any potential
disruptions to trade with key partners such as Mexico.
ADM sees "undeniable positives" in proposals from U.S. tax
policy reform and lower corporate taxes to deregulation and
investments in infrastructure, the company said after reporting
a drop in quarterly profit on Tuesday.
"We are cautiously optimistic given their priorities that
the government has delineated in the early days," Chief
Executive Officer Juan Luciano said during a conference call
with analysts. "If they do what they say ... it will
significantly benefit ADM and our shareholders, probably the
economy as a whole in that sense."
The Chicago-based agribusiness downplayed concerns that a
trade war could erupt over the administration's threats to tax
imports and build a border wall with Mexico and stressed that
ADM's global supply chain could weather any trade disruptions.
ADM is among dozens companies and industry groups that have
reached out to the White House about proposals to tear up or
renegotiate trade agreements such as NAFTA that have helped
boost U.S. agricultural exports.
"We think that we are going to talk with our partners in
Mexico and we are probably going to modernize NAFTA. But even if
the worst came to happen, we think that we still have a very
positive 2017 ahead of us," Luciano said.
ADM reported net fourth quarter earnings of $424 million, or
73 cents per share, down 41 percent from $718 million, or $1.19
per share, in the same period a year earlier. Excluding items,
ADM earned 75 cents per share, missing the consensus estimate of
77 cents a share, according to Thomson Reuters I/B/E/S.
A record-large U.S. corn and soybean harvest and brisk U.S.
crop exports boosted results for its agricultural services
segment. But those gains were blunted by more losses by its
global trading desk, which has exited energy trading and shed
key personnel in recent months.
ADM said it has turned down bids for its corn ethanol dry
mills after offering the assets up for possible sale or other
transaction last year, but remains in talks with bidders.
Potential tax reforms proposed by the Republican-led government
could also broaden ADM's options in any deal in the future,
Chief Financial Officer Ray Young said.
ADM shares were up 1.6 percent on Tuesday at $44.74.
(Additional reporting by Arathy S Nair in Bengaluru; Editing by
Sriraj Kalluvila, Paul Simao and Bernard Orr)