ADM(ADM) - 2025 Q1 - Quarterly Report

Financial Performance - Revenues for Q1 2025 were $20,175 million, a decrease of 7.7$21,847 million in Q1 2024[13] - Gross profit for Q1 2025 was $1,180 million, down 29$1,659 million in Q1 2024[13] - Net earnings attributable to Archer-Daniels-Midland Company were $295 million, a decline of 59.6$729 million in the same quarter last year[13] - Basic earnings per share decreased to $0.61 in Q1 2025 from$1.42 in Q1 2024, representing a drop of 57.3%[13] - Total comprehensive income attributable to Archer-Daniels-Midland Company was $175 million in Q1 2025, down from$646 million in Q1 2024[14] - Other income - net for the three months ended March 31, 2025, was $(19) million, a decrease from$(26) million in the same period in 2024[152] - The company reported a total asset impairment, exit, and restructuring costs of $38 million for the three months ended March 31, 2025, compared to$18 million in the same period of 2024[176] Assets and Liabilities - Total current assets increased slightly to $27,882 million as of March 31, 2025, compared to$27,718 million at the end of 2024[16] - Cash and cash equivalents rose to $864 million from$611 million at the end of 2024, an increase of 41.3%[16] - As of March 31, 2025, total cash, cash equivalents, restricted cash, and restricted cash equivalents amounted to $4,056 million, a decrease from$4,845 million as of March 31, 2024[29] - The fair value of total assets as of March 31, 2025, was $10,308 million, with inventories carried at market valued at$7,021 million[72] - The fair value of the Company's long-term debt was $7.2 billion as of March 31, 2025, compared to a carrying value of$7.6 billion[134] - The Company had lines of credit totaling $12.4 billion as of March 31, 2025, with$7.6 billion remaining unused[135] Segment Performance - The Ag Services and Oilseeds segment generated $17,219 million in total revenues, contributing significantly to the overall revenue[55] - The Carbohydrate Solutions segment reported revenues of$2,683 million, with starches and sweeteners accounting for $2,156 million[55] - The Nutrition segment achieved total revenues of$1,836 million, with human and animal nutrition contributing $964 million and$872 million, respectively[55] - Segment operating profit for the Ag Services and Oilseeds segment was $412 million, Carbohydrate Solutions was$240 million, and Nutrition was $95 million, totaling$747 million in segment operating profit[162] - The company’s operations are organized into three reportable segments: Ag Services and Oilseeds, Carbohydrate Solutions, and Nutrition, with each segment evaluated based on operating profit[153] Cash Flow and Investments - Net cash used in operating activities was $(342) million in Q1 2025, compared to$700 million provided in Q1 2024[18] - Capital expenditures for Q1 2025 were $291 million, down from$328 million in Q1 2024[18] - The Company’s investment in Wilmar International Limited had a carrying value of $3.6 billion as of March 31, 2025, with a market value of$3.5 billion[41] - The Company executed cross-currency swaps with an aggregate notional amount of $411 million and foreign exchange forwards totaling$2.4 billion as of March 31, 2025[122] Shareholder Returns - The company paid dividends of $0.51 per share in Q1 2025, slightly up from$0.50 per share in Q1 2024[13] - The Company had approximately 235.7 million shares of common stock in treasury, valued at $4.8 billion as of March 31, 2025[140] - The Company has a share repurchase program with 115 million shares remaining to be repurchased until December 31, 2029[145] Restructuring and Cost Management - The company announced a restructuring program expected to deliver over$500 million in cost savings by fiscal 2029, with restructuring charges of $23 million in Q1 2025[179] - A restructuring program announced on February 4, 2025, is expected to deliver over$500 million in annual cost savings by fiscal 2029 through various initiatives[205] - The Company intends to prioritize operational excellence and targeted cost reductions, including optimizing operating leverage within the Nutrition segment[202] Legal and Regulatory Matters - The Company is facing multiple class action lawsuits alleging damages between approximately $500 million to over$2.0 billion due to alleged price manipulation in ethanol derivatives[190] - The Company is under investigation by the SEC and DOJ regarding intersegment sales, and it is cooperating with these investigations[192][206] - The Company has identified a material weakness in its internal control over financial reporting related to segment disclosures[207] Market and Economic Conditions - The Company operates in approximately 78 countries, with local currencies as functional currencies for most subsidiaries, impacting revenue and expense translations[210] - The Nutrition segment's revenue changes may not correlate with cost changes, making margin rates a key performance indicator[209] - The Company aims to enhance returns on invested capital through strategic simplification and targeted growth investments[202]