Archer Daniels Midland
stock was rising Monday after the agriculture company said its financial results wouldn’t be materially impacted by intersegment sales, which are being investigated.
“We are conducting an investigation about intersegment sales, which involves the transfer of goods and the related financial accounting between business segments,” Chief Executive Juan Luciano said in a message to employees that was contained in a filing Friday with the Securities and Exchange Commission. “For this reason, it is taking longer to close our financial results, but these sales do not materially affect our overall results.”
Archer Daniels
said in the filing that it expects to post fiscal 2023 earnings of above $6.90 a share. While that’s less than the
FactSet
consensus of $7.05 a share, the company said that fourth-quarter 2023 leverage is expected to remain at “similar healthy levels” to the third quarter of 2023. Last week, the company also announced a dividend of 50 cents a share, an increase from the previous 45 cents.
ADM placed Chief Financial Officer Vikram Luther under administrative leave on Jan. 21 as it opened an investigation into the company’s accounting practices. The investigation, which is being conducted by outside counsel for ADM and the board’s audit committee, involves certain accounting practices and procedures with respect to ADM’s Nutrition segment, including certain intersegment transactions.
Meanwhile, Reuters has reported that ADM will delay paying performance bonuses to some executives until financial statements are completed and audited, citing a staff memo. ADM declined to comment on the report to Barron’s.
ADM was the top performer in the
S&P 500
on Monday with shares rising 5% to $54.66 and on pace for their largest percentage increase since January 2022, according to Dow Jones Market Data. However, shares have fallen 24% month to date, which marks the stock’s worst month since April 2005. The stock tumbled 24% on Jan. 22 alone after the company announced its investigation into intersegment sales the day before.
Write to Angela Palumbo at angela.palumbo@dowjones.com
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