Many corporations opened their books on Wednesday, June the 27th. Monsanto, General Mills and Paychex reported their quarterly results. The following is a brief review of the most important facts pertaining to their reports.
Monsanto (MON) ended the day 3.9% higher after the provider of agricultural goods reported a strong set of third quarter results on Wednesday. The company reported a 17% increase in net sales to $4.2 billion driven by strong volume growth within the seeds and traits business. Notably, the corn seed and traits division performed strong. Net income rose 22% to $937 million, or $1.74 per share. Earnings per share from the ongoing activities rose to $1.63 per share.
CEO Grant was content with the results "We've achieved excellent business results this year, but more importantly we've continued to receive positive response to our products from farmers". For the full year of 2012, Monsanto expects to earn between $3.65 and $3.70 per share, implying a loss for the final quarter of $0.51-$0.56 per share vs. a loss of $0.21 in the final quarter last year. Despite the not-so-ambitious outlook, investors reacted positively as the company is confident in the momentum of the business and the prospects for 2013 and beyond. So far this year, the shares have returned 15%.
General Mills (GIS) the manufacturer of consumer goods, including brands Haagen-Dazs, Cheerios and Yoplait, announced its fourth quarter results on Wednesday. Fourth quarter revenues rose 12% to $4.1 billion, driven by the acquisition of the Yoplait acquisition - which added 9% to the sales growth. Operating profits rose 9% to $737 million, with diluted earnings per share coming in at $0.49. The company took a $64 million restructuring charge during the quarter. Excluding the charge, diluted earnings per share came in at $0.60.
For the full year of 2012 net sales rose 12% to $16.7 billion. US retail operations generated 3% more revenues to $10.5 billion, while International revenues rose 46% to $4.2 billion, driven by the acquisition of the international activities of Yoplait. CEO Powell commented on the results: "We expect fiscal 2013 to be another year of good growth for General Mills, reflecting sales and profit increases from our base business along with contributions from newly acquired operations".
For 2013, General Mills expects net sales growth at a mid-single digit rate and input cost inflation of 2%-3%. Earnings per share could be reduced as a result of higher pension expenses and tax rates, partially offset by the impact of share repurchases. Shares of General Mills fell 1.6% in yesterday's session on the back of a cautious outlook for 2013. So far in 2012, shares have fallen 7%.
Paychex (PAYX), the provider of payroll, human resource and outsourcing services, presented its fourth quarter and full year earnings on Wednesday. Total revenues for the final quarter rose 6% to $551.5 million, driven by a strong 12% revenue increase at its human resource division to $171.2 million. Operating income rose 7% to $195.9 million. A higher tax rate resulted in a merely 4% increase in net income to $123.3 million, or $0.34 per share.
For the full year of 2012, the company reported a 7% increase in total revenues to $2.23 billion, with net income increasing 6% to $548 million, or $1.51 per diluted share. CEO Mucci looked forward to 2013: The company expects total service revenue growth between 5% and 6%, driven by a strong outlook for the human resource division. Full year net income is expected to increase between 5 and 7%. Shares of Paychex ended the day 0.5% higher yesterday, marking year to date gains of 6%.
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.
