BG Inks Deal to Sell European Margarines and Spreads Business
Bunge Global SA BG announced that it has entered into an agreement to sell its European margarines and spreads business to Vandemoortele. This strategic move aims to streamline BG's portfolio. It also aligns with Bunge Global's focus on maintaining global leadership in integrated value chains in oilseeds and grains, as well as in connected oils, emulsifiers and proteins B2B ingredients businesses.
The sale includes Bunge Global's portfolio of 20 consumer brands and manufacturing facilities for spreads and margarine in Germany, Finland, Poland and Hungary. The buyer, Vandemoortele, is a family-owned food group in Europe with a strong presence in margarines and plant-based oils & fats. The completion of the sale, however, remains subject to customary closing conditions, including regulatory approvals.
In October 2024, Bunge Global sold its Sugar and Bioenergy segment, which primarily comprised its 50% interest in the BP Bunge Bioenergia joint venture. This marked the company's exit from the bioenergy and sugarcane ethanol business in Brazil. This divestiture was also carried out to shift its focus back to its core operations.
Bunge Global reported adjusted earnings of $9.19 per share in 2024, which missed the Zacks Consensus Estimate of $9.35. Earnings were 33% lower than the prior year. The bottom line also fell short of the company's projected adjusted earnings per share of 'at least $9.25' for 2024. Total revenues fell 11% year over year to $53.1 billion, which fell short of the Zacks Consensus Estimate of $52.37 billion.
The company projects adjusted earnings per share of $7.75 in 2025, indicating a 15.7% year-over-year decline.
The Agribusiness segment is expected to witness a year-over-year decline due to lower results in Processing. The company expects improved results in South America to be offset by lower results in North America and European softseeds. Results in Merchandising will be down slightly from last year.
The Refined and Specialty Oils segment's full-year results are also anticipated to be down from 2024, reflecting a more balanced supply and demand environment in North America. The Milling segment is expected to deliver an improvement in results.
Shares of Bunge Global have lost 26.4% over the past year compared with the industry's 13.0% decline.
Image Source: Zacks Investment Research
Bunge Global currently carries a Zacks Rank #4 (Sell).
Better-ranked stocks in the basic materials space are Axalta Coating Systems Ltd. AXTA, Carpenter Technology CRS and Silvercorp Metals SVM. AXTA currently sports a Zacks Rank #1 (Strong Buy) while CRS and SVM carry a Zacks Rank #2 (Buy). You can see the complete list of today's Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Axalta Coating Systems' fiscal 2025 earnings indicates year-over-year growth of 8.5%. The company beat the consensus estimate in each of the trailing four quarters, delivering an earnings surprise of roughly 16.3%, on average. AXTA's shares have gained 2.2% over the past year.
The consensus estimate for Carpenter Technology's fiscal 2025 earnings implies year-over-year growth of 46.6%. CRS beat the Zacks Consensus Estimate in each of the last four quarters, with the average earnings surprise being 15.7%. The company's shares have soared 185% in the past year.
Silvercorp beat the consensus estimate in three of the last four quarters and was in line once, with the average earnings surprise being 11.5%. The Zacks Consensus Estimate for the company's current fiscal-year earnings indicates year-over-year growth of 68.2%. SVM has gained around 33% in the past year.
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This article originally published on Zacks Investment Research (zacks.com).
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