Seeds and agrochemicals company Monsanto has today reported a stronger-than-expected quarterly profit as record US and Brazilian soybean plantings lifted seed sales.
Monsanto is in the process of being bought by Germany's Bayer.
The company reaffirmed its ongoing earnings per share target and raised its gross profit outlook for its seeds and genomics unit, which sells seeds, licenses biotech traits and sells farm data services.
Record soybean seedings in the US and Brazil, the world's top two producers of the oilseed, were a boon for the world's largest seed company.
Sales of soybean seed and traits, the company's second-biggest business by revenue, jumped 29.3% to $896m in the third quarter ended May 31, Monsanto said today.
Seedings of Monsanto's newest US soybean varieties, known as Roundup Ready 2 Xtend, totaled 20 million acres this spring, above earlier forecasts for 18 million.
Intacta, its newest South American soy, was planted on more than 50 million acres, near the high end expectations.
However, sales of corn seed and traits, the company's biggest revenue generator, fell 6.3% to $1.49 billion in the third quarter.
Monsanto agreed in September to a $66 billion buyout offer from Bayer, that, if approved by regulators, would create a company commanding more than a quarter of the world market for seeds and pesticides.
Monsanto said it was working toward the completion of the merger by the end of the calendar year.
Bayer said last month it would sell its LibertyLink-branded seeds businesses, a key part of the asset sales required to satisfy competition authorities looking at the Monsanto deal.
Net income attributable to Monsanto rose to $843m, or $1.90 per share, in the third quarter, from $717m, or $1.63 per share, a year earlier.
Excluding certain items, Monsanto earned $1.93 per share, handily beating the analysts' average estimate of $1.76, according to Thomson Reuters I/B/E/S.
Earnings per share guidance remained at the high end of the range of $4.50 to $4.90 on an ongoing basis.
Seeds and genomics gross profit for fiscal 2017 was projected in the high single digits in percentage terms, up from an the previous forecast for the mid-single digits.
