Monsanto Reports 4Q17 Earnings: Stock Unchanged

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Part 4
Monsanto Reports 4Q17 Earnings: Stock Unchanged PART 4 OF 6

An Important Look at Monsanto’s 4Q17 Overall Profitability


In this part of the series, we’re going to zoom out and look at Monsanto’s (MON) overall profitability for fiscal 4Q17. As we saw in the previous part, Monsanto’s overall gross margins expanded year-over-year from 44.4% to 49.9%. Let’s see how other profitability measures fared during the quarter.

An Important Look at Monsanto&#8217;s 4Q17 Overall Profitability

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4Q17 performance

EBITDA (earnings before interest, tax, depreciation, and amortization) margins, as shown in the above chart, are calculated after making adjustments to exclude one-time items. EBITDA margins appear to have slightly contracted year-over-year from 7.3% in 4Q16 to 7.0% in 4Q17. However, adjusted net margins have improved year-over-year from 1.2% to 3.1% over the same period.

During the earnings call, Monsanto’s management stated that growth in profits for its Seeds and Genomics segment was “fueled by the outstanding penetration of our latest soybean and cotton technologies and continued adoption of our newest corn hybrids around the globe, reflecting the need for new solutions in what continues to be a challenging ag economy.”

In our series An In-Depth Review of Monsanto Company’s 2016, we saw how Monsanto’s profitability compares with its peers (MOO) FMC (FMC), Syngenta (SYT), and DowDuPont (DWDP) prior to the merger.

In the next part of this series, we’ll look at management’s updates on Monsanto’s future growth drivers.


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