By Rachel Martinez, The Appleton Times
CHICAGO — Shares of Bunge Global SA (NYSE: BG) tumbled in premarket trading Wednesday after the multinational agribusiness giant reported stronger-than-expected fourth-quarter results but tempered investor enthusiasm with a cautious profit forecast for the coming year. The stock, a bellwether for the global commodities sector, fell 2.89% to $113.50 in early trading, according to data from Benzinga Pro, reflecting broader concerns about market volatility and limited visibility in the agricultural supply chain.
Bunge, headquartered in St. Louis with major operations spanning North and South America, Europe, and Asia, announced its fiscal 2025 fourth-quarter earnings late Tuesday. The company posted adjusted earnings per share of $1.99, surpassing the consensus analyst estimate of $1.81 compiled by Wall Street observers. Revenue for the period also exceeded expectations, reaching $23.762 billion compared to the forecasted $22.684 billion, marking a robust performance amid fluctuating commodity prices.
Breaking down the results by segment, Bunge's Soybean Processing and Refining division led the gains, with net sales climbing to $11.045 billion from $8.374 billion a year earlier. This uptick was largely attributed to stronger processing and refining activities in South America, particularly in Argentina and Brazil, where favorable conditions boosted output. "Slightly higher segment results were primarily driven by South America," the company stated in its earnings release, highlighting the region's pivotal role in its operations.
The Softseed Processing and Refining segment also showed significant improvement, reporting net sales of $4.545 billion, a sharp increase from $1.808 billion in the prior year. According to Bunge, this growth stemmed from elevated average processing margins and the integration of assets from its recent acquisition of Viterra, a major player in softseed processing. The Viterra deal, completed earlier in the year, has expanded Bunge's capabilities in handling crops like canola and sunflower seeds, providing a more diversified portfolio in a market prone to weather-related disruptions.
In contrast, the Other Oilseeds Processing and Refining segment remained stable, with net sales holding steady at $1.191 billion year over year. Meanwhile, the Grain Merchandising and Milling division saw a substantial rise, with sales jumping to $6.982 billion from $2.242 billion, driven by increased global demand for grains amid ongoing supply chain adjustments post-pandemic.
Overall, Bunge's gross profit for the quarter came in at $1.011 billion, a slight dip from $1.081 billion the previous year, but adjusted total earnings before interest and taxes (EBIT) surged to $622 million from $445 million. This improvement across all segments was credited to "disciplined execution and the company’s expanded footprint and capabilities," as outlined in the financial disclosures. The enhancements underscore Bunge's strategic moves to consolidate its position in the $1.5 trillion global agribusiness market.
Despite these positives, the company's outlook for fiscal 2026 cast a shadow over the results. Bunge projected adjusted earnings per share of $7.50 to $8.00, falling short of analysts' average estimate of $8.71. This softer guidance prompted the immediate sell-off, as investors grappled with uncertainties in commodity pricing, geopolitical tensions affecting trade routes, and potential shifts in global demand for biofuels and animal feed.
CEO Greg Heckman addressed these challenges in a prepared statement, emphasizing the company's resilience. "While forward visibility remains limited amid dynamic market conditions, our expanded capabilities, more balanced global footprint and diversified value chains give us the tools to better adapt, manage risk, and continue connecting farmers to global demand for food, feed and fuel in any environment," Heckman said. His comments reflect Bunge's long-standing role as a bridge between producers in rural heartlands and urban consumers worldwide.
Financially, Bunge ended the quarter with $1.135 billion in cash and equivalents, down from $3.311 billion a year ago, partly due to investments in growth initiatives. Cash flow from operations for the full year totaled $844 million, a decline from $1.9 billion in the prior period, influenced by lower net income and fluctuations in working capital. Looking ahead, the company anticipates an adjusted effective tax rate of 23% to 27% for 2026, along with net interest expenses ranging from $575 million to $625 million.
Capital expenditures are forecasted at $1.5 billion to $1.7 billion, with depreciation and amortization expected to hit around $975 million. These projections signal Bunge's commitment to modernizing its infrastructure, including port facilities in key export hubs like Santos, Brazil, and New Orleans, Louisiana, to handle increasing volumes of soybeans and other staples.
Bunge's performance comes against a backdrop of a volatile agricultural sector. The company, founded in 1818 in Amsterdam and now a Fortune 500 entity, has navigated everything from the Russia-Ukraine conflict's impact on grain exports to climate-driven droughts in major producing regions. In recent years, Bunge has pursued mergers and acquisitions to fortify its supply chain; the $34 billion Viterra acquisition in 2024, for instance, created one of the world's largest integrated agribusinesses, combining Bunge's strengths in oilseed processing with Viterra's grain handling expertise.
Analysts offered mixed reactions to the earnings. While some praised the beat on quarterly metrics, others focused on the guidance miss. "The softer outlook reflects ongoing pressures from normalizing margins post the 2022 commodity boom," noted one market watcher, speaking on condition of anonymity due to client relationships. Benzinga, in its coverage, highlighted how investor sentiment shifted toward caution, with premarket volume spiking as traders adjusted positions.
The stock's decline Wednesday mirrors broader trends in the sector. Competitors like Archer-Daniels-Midland and Cargill have also reported tempered expectations amid softening demand from China, the world's top importer of soybeans. Bunge's results, however, provide a snapshot of resilience; its agribusiness division, which includes merchandising and risk management, continues to benefit from hedging strategies that mitigate price swings.
Looking further afield, Bunge's fortunes are intertwined with global food security. With operations in over 40 countries and a workforce of more than 23,000, the company processes millions of tons of crops annually. The CEO's remarks on adaptability resonate in an era of climate change and trade barriers, where events like the 2023 El Niño weather pattern disrupted harvests in South America.
As Bunge moves into 2026, stakeholders will watch closely for signs of stabilization. The company's dividend policy remains attractive, with a recent payout of $0.68 per share, yielding about 2.4% at current prices. Yet, with shares down nearly 20% year-to-date before Wednesday's drop, pressure mounts for management to deliver on integration synergies from recent deals.
In summary, while Bunge's latest quarter showcased operational strength, the forward-looking caution has investors on edge. As Heckman noted, the agribusiness landscape demands agility, and Bunge appears positioned to weather the storms ahead, connecting the dots from farm fields to dinner tables across the globe.