April 3 (Bloomberg) -- Monsanto Co., the world’s largest seed company, raised its full-year earnings forecast and posted fiscal second-quarter profit that beat analysts’ estimates as U.S. farmers bought more genetically modified corn seed.
Net income rose to $1.48 billion, or $2.74 a share, in the three months through February, from $1.21 billion, or $2.24, a year earlier, St. Louis-based Monsanto said today in a statement. Earnings excluding one-time items were a record $2.73 a share, topping the $2.57 average of 20 estimates compiled by Bloomberg. Revenue rose to $5.47 billion from $4.75 billion a year earlier.
Monsanto said it will earn $4.40 to $4.50 a share in the 12 months through August excluding one-time costs, up from a January forecast of $4.30 to $4.40. The average of 22 estimates was $4.57.
Chairman and Chief Executive Officer Hugh Grant is selling more corn seed engineered to kill bugs and tolerate Roundup weedkiller as U.S. farmers prepare to plant the biggest crop in 77 years. Roundup sales rose as competitors increased prices for the generic form of the weed killer, said Chris Shaw, a New York-based analyst at Monness Crespi Hardt & Co.
"The upside is being driven by sustained elevated prices in Roundup and a strong U.S. seed season," Shaw, who recommends buying the shares, said in an April 1 note.
U.S. Farmers may plant 97.3 million acres of corn this year, the most since 1936, the U.S. Department of Agriculture said last week. Corn prices reached a record last year after the worst drought since the 1930s cut production by 13 percent.
Monsanto fell 1.7 percent to $104 yesterday in New York. The shares have gained 9.9 percent this year.
--Editors: Steven Frank, Charles Siler
To contact the reporter on this story: Jack Kaskey in Houston at [email protected]