St. Louis, Missouri
September 17, 2007
Monsanto Company (NYSE: MON) announced today that its fiscal
year 2007 ongoing earnings per share (EPS) guidance is now
expected to be approximately $2.00 per share, or approximately
$1.79 on a reported basis. The company had previously estimated
that its fiscal year 2007 EPS would be in the range of $1.75 to
$1.80 on an ongoing basis. (For a reconciliation of ongoing EPS,
see note 1.)
The company noted that several factors are contributing to its
better- than-anticipated results, including:
- Effective tax rate:
Monsanto expects its full-year effective tax rate on
continuing operations to be approximately 30 percent. The
effective tax rate reflects the resolution of several tax
audits earlier in the
year and the company's ability to use net-operating loss
carry forwards in Argentina. The effective rate also
reflects approximately 4 points attributable to
non-deductible in-process research-and-development charges
associated with the company's recent acquisition of Delta
and Pine Land Company.
- Continued strong results
in corn globally: The results reflect strong, early sales of
corn seeds in Brazil and Argentina which were higher than
originally anticipated.
- Better-than-expected
pricing for the Roundup business: While sales of the
company's Roundup agricultural herbicides were flat in the
fourth quarter, prices were higher, particularly for branded
Roundup agricultural herbicides, versus the company's
original expectations.
"By all measures, Monsanto has
achieved extraordinary performance across our business in what
was an extraordinary year for agriculture," said Hugh Grant,
Monsanto chairman, president and chief executive officer. "Our
performance this year serves as a springboard for our future
success, setting us up for expanded growth opportunities not
just for 2008, but through the turn of the decade."
The company also announced that it now expects that its free
cash flow for fiscal year 2007 will be a use of approximately
$60 million, compared with its previous guidance of a use of
$250 million to $200 million. The company's free cash flow
guidance for the 2007 fiscal year reflects the cash effect of
Monsanto's $1.5 billion acquisition D&PL, net of cash acquired
and debt assumed; as well as the receipt of $317 million for the
sale of the Stoneville and NexGen cottonseed businesses. The
company expects net cash provided by operating activities to be
approximately $1.9 billion, and net cash required by investing
activities to be approximately $1.9 billion for fiscal year
2007. (For a reconciliation of free cash flow, see note 2.)
Monsanto Company (NYSE: MON) is a leading global provider of
technology- based solutions and agricultural products that
improve farm productivity and food quality.
Roundup is a registered trademark owned by Monsanto Company and
its wholly owned subsidiaries.
Monsanto Company
Selected Financial Information
(Dollars in millions)
Unaudited
1). Reconciliation of EPS to Ongoing EPS: Ongoing EPS is calculated
excluding certain after-tax items which Monsanto does not consider
part of ongoing operations.
Fiscal Year Fiscal Year
2007 2006
Target Actual
Diluted Earnings per Share $1.79 $1.25
Income on Discontinued Operations $(0.13) -
In-Process R&D Write-Off Related
to the Delta & Pine Land
Acquisition $0.34 -
Tax Charge on Repatriated Earnings - $0.04
Cumulated Effect of Change in
Accounting Principle - $0.01
Diluted Earnings per Share from
Ongoing Basis $2.00 $1.30
2). Reconciliation of Free Cash Flow: Free cash flow represents the total
of cash flows from operating activities and investing activities, as
reflected in the Statements of Consolidated Cash Flows presented in
this release.
Fiscal Year Fiscal Year
2007 2006
Target Actual
Net Cash Provided by Operating
Activities $1,870 $1,674
Net Cash Required by Investing
Activities (1,930) (625)
Free Cash Flow $(60) $1,049
Net Cash Required by Financing
Activities (580) (117)
Effect of Exchange Rate Changes on
Cash and Cash Equivalents 40 3
Net Increase (Decrease) in Cash and
Cash Equivalents $(600) $935
Cash and Cash Equivalents at Beginning
of Period 1,460 $525
Cash and Cash Equivalents at End of
Period $860 $ 1,460
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