Healthy margins help Dreyfus to report profit rise

Joseph Millis
Margarita Louis-Dreyfus, the Russian-born chairman of Louis Dreyfus
GLOBAL trading group Louis Dreyfus Commodities yesterday reported a rise in full-year profit as increased volumes and healthy processing margins help­ed to offset lower market prices.

Louis Dreyfus is one of the “ABCD” quartet – alongside Archer Daniels Mid­land (ADM), Bunge and Cargill – that dom­inates agricultural commodity trading.

Net income, group share, reached $648m (£436.4m) last year, up from $640m in 2013, while net sales rose to $64.7bn from $63.6bn, supported by a four per cent increase in shipped volumes to 80m tonnes, the company said.

The group’s Value Chain division, comprising integrated activities in oilseeds, grains, juice, fertilisers, livestock feed and stock, posted a 19 per cent rise in its operating result as ample crop supply benefited processing activities, Louis Dreyfus said.

One exception was the juice unit, which suffered from lower consumption and high inventory levels in global juice markets.

ADM and Cargill have also pointed in their most recent financial results to a margin boost from more abundant, cheaper supplies of grain.

The group was also affected by instability last year in Ukraine and Russia, two leading grain producers and exporters, it said – although it added that the impact was limited.

Louis Dreyfus’ capital investment last year was $592m, down from $689m in 2013, with acting chief executive and CFO Claude Ehl­inger citing a “granular approach – foc­used primarily on logistics”.