DOCUMENT AND ENTITY INFORMATION
DOCUMENT AND ENTITY INFORMATION - shares | 3 Months Ended | |
Mar. 31, 2016 | Apr. 22, 2016 | |
Document And Entity Information | ||
Entity Registrant Name | Bunge LTD | |
Entity Central Index Key | 1,144,519 | |
Document Type | 10-Q | |
Document Period End Date | Mar. 31, 2016 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Entity Current Reporting Status | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 139,378,060 | |
Document Fiscal Year Focus | 2,016 | |
Document Fiscal Period Focus | Q1 | |
Trading symbol | bg |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF INCOME - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
CONDENSED CONSOLIDATED STATEMENTS OF INCOME | ||
Net sales | $ 8,916 | $ 10,806 |
Cost of goods sold | (8,296) | (10,096) |
Gross profit | 620 | 710 |
Selling, general and administrative expenses | (314) | (331) |
Interest income | 10 | 11 |
Interest expense | (57) | (53) |
Foreign exchange gains (losses) | 21 | (7) |
Other income (expense) - net | (5) | 1 |
Income from continuing operations before income tax | 275 | 331 |
Income tax (expense) benefit | (34) | (85) |
Income (loss) from continuing operations | 241 | 246 |
Income (loss) from discontinued operations, net of tax | (9) | 14 |
Net income (loss) | 232 | 260 |
Net (income) loss attributable to noncontrolling interests | 3 | 3 |
Net income (loss) attributable to Bunge | 235 | 263 |
Convertible preference share dividends and other obligations | (13) | (14) |
Net income (loss) available to Bunge common shareholders | $ 222 | $ 249 |
Earnings per common share-basic (Note 16) | ||
Net income (loss) from continuing operations (in dollars per share) | $ 1.64 | $ 1.61 |
Net income (loss) from discontinued operations (in dollars per share) | (0.07) | 0.10 |
Net income (loss) attributable to Bunge common shareholders (in dollars per share) | 1.57 | 1.71 |
Earnings per common share-diluted (Note 16) | ||
Net income (loss) from continuing operations (in dollars per share) | 1.60 | 1.58 |
Net income (loss) from discontinued operations (in dollars per share) | (0.06) | 0.09 |
Net income (loss) attributable to Bunge common shareholders (in dollars per share) | 1.54 | 1.67 |
Dividends per common share (in dollars per share) | $ 0.38 | $ 0.34 |
CONDENSED CONSOLIDATED STATEME3
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) | ||
Net income (loss) | $ 232 | $ 260 |
Other comprehensive income (loss): | ||
Foreign exchange translation adjustment | 520 | (1,339) |
Unrealized gains (losses) on designated cash flow and net investment hedges, net of tax (expense) benefit of nil in 2016 and nil in 2015 | (184) | 42 |
Reclassification of realized net losses (gains) to net income, net of tax expense (benefit) of nil in 2016 and nil in 2015 | 7 | 13 |
Pension adjustment, net of tax (expense) benefit of $nil in 2016 and nil in 2015 | 3 | |
Total other comprehensive income (loss) | 343 | (1,281) |
Total comprehensive income (loss) | 575 | (1,021) |
Less: comprehensive (income) loss attributable to noncontrolling interests | (6) | 10 |
Total comprehensive income (loss) attributable to Bunge | $ 569 | $ (1,011) |
CONDENSED CONSOLIDATED STATEME4
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (Parenthetical) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) | ||
Unrealized gains (losses) designated cash flow and net investment hedges, tax (expense) benefit | $ 0 | $ 0 |
Reclassification of realized net losses (gains) to net income, tax expense (benefit) | 0 | 0 |
Pension adjustment, net of tax (expense) benefit | $ 0 | $ 0 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Millions | Mar. 31, 2016 | Dec. 31, 2015 |
Current assets: | ||
Cash and cash equivalents | $ 523 | $ 411 |
Time deposits under trade structured finance program (Note 4) | 242 | 325 |
Trade accounts receivable (less allowances of $141 and $125) (Note 12) | 1,958 | 1,607 |
Inventories (Note 5) | 4,807 | 4,466 |
Deferred income taxes | 112 | 208 |
Other current assets (Note 6) | 3,781 | 3,899 |
Total current assets | 11,423 | 10,916 |
Property, plant and equipment, net | 4,884 | 4,736 |
Goodwill | 429 | 418 |
Other intangible assets, net | 339 | 326 |
Investments in affiliates | 330 | 329 |
Deferred income taxes | 557 | 417 |
Other non-current assets (Note 7) | 977 | 772 |
Total assets | 18,939 | 17,914 |
Current liabilities: | ||
Short-term debt | 810 | 648 |
Current portion of long-term debt (Note 11) | 213 | 869 |
Letter of credit obligations under trade structured finance program (Note 4) | 242 | 325 |
Trade accounts payable | 3,284 | 2,675 |
Deferred income taxes | 92 | 60 |
Other current liabilities (Note 9) | 2,451 | 2,763 |
Total current liabilities | 7,092 | 7,340 |
Long-term debt (Note 11) | 3,845 | 2,926 |
Deferred income taxes | 212 | 209 |
Other non-current liabilities | $ 786 | $ 750 |
Commitments and contingencies (Note 14) | ||
Redeemable noncontrolling interests | $ 41 | $ 37 |
Equity (Note 15): | ||
Convertible perpetual preference shares, par value $.01; authorized, issued and outstanding 2016 and 2015 - 6,900,000 shares (liquidation preference $100 per share) | 690 | 690 |
Common shares, par value $.01; authorized - 400,000,000 shares; issued and outstanding:2016 - 139,703,904 shares, 2015 - 142,483,467 shares | 1 | 1 |
Additional paid-in capital | 5,108 | 5,105 |
Retained earnings | 7,900 | 7,725 |
Accumulated other comprehensive income (loss) (Note 15) | (6,026) | (6,360) |
Treasury shares, at cost - 2016 - 12,551,432 and 2015 - 9,586,083 shares, respectively | (901) | (720) |
Total Bunge shareholders' equity | 6,772 | 6,441 |
Noncontrolling interests | 191 | 211 |
Total equity | 6,963 | 6,652 |
Total liabilities and equity | $ 18,939 | $ 17,914 |
CONDENSED CONSOLIDATED BALANCE6
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Millions | Mar. 31, 2016 | Dec. 31, 2015 |
CONDENSED CONSOLIDATED BALANCE SHEETS | ||
Trade accounts receivable, allowances (in dollars) | $ 141 | $ 125 |
Convertible perpetual preference shares, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Convertible perpetual preference shares, authorized | 6,900,000 | 6,900,000 |
Convertible perpetual preference shares, issued | 6,900,000 | 6,900,000 |
Convertible perpetual preference shares, outstanding | 6,900,000 | 6,900,000 |
Convertible perpetual preference shares, liquidation preference (in dollars per share) | $ 100 | $ 100 |
Common shares, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common shares, authorized | 400,000,000 | 400,000,000 |
Common shares, issued | 139,703,904 | 142,483,467 |
Common shares, outstanding | 139,703,904 | 142,483,467 |
Treasury shares | 12,551,432 | 9,586,083 |
CONDENSED CONSOLIDATED STATEME7
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
OPERATING ACTIVITIES | ||
Net income (loss) | $ 232 | $ 260 |
Adjustments to reconcile net income (loss) to cash provided by (used for) operating activities: | ||
Foreign exchange loss (gain) on debt | 78 | (225) |
Bad debt expense | 11 | 7 |
Depreciation, depletion and amortization | 113 | 120 |
Stock-based compensation expense | 13 | 13 |
Deferred income tax expense (benefit) | 32 | 16 |
Other, net | 12 | (18) |
Changes in operating assets and liabilities, excluding the effects of acquisitions: | ||
Trade accounts receivable | (301) | 221 |
Inventories | (222) | 471 |
Secured advances to suppliers | 78 | (226) |
Trade accounts payable and accrued liabilities | 442 | 38 |
Net unrealized gain/loss on derivative contracts | (410) | (275) |
Margin deposits | 100 | 10 |
Other, net | (101) | (104) |
Cash provided by (used for) operating activities | 77 | 308 |
INVESTING ACTIVITIES | ||
Payments made for capital expenditures | (110) | (117) |
Acquisitions of businesses (net of cash acquired) | (48) | |
Proceeds from investments | 158 | 60 |
Payments for investments | (251) | (71) |
Settlement of net investment hedges | 1 | |
Payments for investments in affiliates | (11) | (10) |
Other, net | 1 | (2) |
Cash provided by (used for) investing activities | (212) | (188) |
FINANCING ACTIVITIES | ||
Net change in short-term debt with maturities of 90 days or less | 152 | 67 |
Proceeds from short-term debt with maturities greater than 90 days | 89 | 148 |
Repayments of short-term debt with maturities greater than 90 days | (56) | (143) |
Proceeds from long-term debt | 3,094 | 1,461 |
Repayments of long-term debt | (2,810) | (1,319) |
Proceeds from sale of common shares | 10 | |
Repurchases of common shares | (181) | (200) |
Dividends paid | (62) | (58) |
Return of capital to noncontrolling interest | (6) | |
Other, net | (1) | (1) |
Cash provided by (used for) financing activities | 219 | (35) |
Effect of exchange rate changes on cash and cash equivalents | 28 | (67) |
Net increase (decrease) in cash and cash equivalents | 112 | 18 |
Cash and cash equivalents, beginning of period | 411 | 362 |
Cash and cash equivalents, end of period | $ 523 | $ 380 |
CONDENSED CONSOLIDATED STATEME8
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY AND REDEEMABLE NONCONTROLLING INTERESTS - USD ($) $ in Millions | Redeemable Non-Controlling Interests | Convertible Preference Shares | Common Shares | Additional Paid-in Capital | Retained Earnings | Accumulated Other Comprehensive Income (Loss) | Treasury Shares | Non-Controlling Interests | Total |
Balance at Dec. 31, 2014 | $ 690 | $ 1 | $ 5,053 | $ 7,180 | $ (4,058) | $ (420) | $ 244 | $ 8,690 | |
Balance at Dec. 31, 2014 | $ 37 | ||||||||
Balance (in shares) at Dec. 31, 2014 | 6,900,000 | 145,703,198 | |||||||
Increase (Decrease) in Stockholders' Equity | |||||||||
Net income (loss) | (5) | ||||||||
Net income (loss) | 263 | (3) | 260 | ||||||
Accretion of noncontrolling interests | 6 | (6) | (6) | ||||||
Other comprehensive income (loss) | (4) | (1,274) | (7) | (1,281) | |||||
Dividends on common shares | (49) | (49) | |||||||
Dividends on preference shares | (8) | (8) | |||||||
Stock-based compensation expense | 13 | 13 | |||||||
Repurchase of common shares | (200) | (200) | |||||||
Repurchase of common shares (in shares) | (2,460,600) | ||||||||
Issuance of common shares | 10 | 10 | |||||||
Issuance of common shares (in shares) | 358,474 | ||||||||
Balance at Mar. 31, 2015 | $ 690 | $ 1 | 5,070 | 7,386 | (5,332) | (620) | 234 | 7,429 | |
Balance at Mar. 31, 2015 | 34 | ||||||||
Balance (in shares) at Mar. 31, 2015 | 6,900,000 | 143,601,072 | |||||||
Balance at Dec. 31, 2015 | $ 690 | $ 1 | 5,105 | 7,725 | (6,360) | (720) | 211 | 6,652 | |
Balance at Dec. 31, 2015 | 37 | 37 | |||||||
Balance (in shares) at Dec. 31, 2015 | 6,900,000 | 142,483,467 | |||||||
Increase (Decrease) in Stockholders' Equity | |||||||||
Net income (loss) | (3) | ||||||||
Net income (loss) | 235 | (3) | 232 | ||||||
Accretion of noncontrolling interests | 5 | (5) | (5) | ||||||
Other comprehensive income (loss) | 2 | 334 | 9 | 343 | |||||
Dividends on common shares | (52) | (52) | |||||||
Dividends on preference shares | (8) | (8) | |||||||
Noncontrolling decrease from redemption | (2) | (4) | (6) | ||||||
Deconsolidation of a subsidiary | (22) | (22) | |||||||
Stock-based compensation expense | 13 | 13 | |||||||
Repurchase of common shares | (181) | (181) | |||||||
Repurchase of common shares (in shares) | (2,965,349) | ||||||||
Issuance of common shares | (3) | (3) | |||||||
Issuance of common shares (in shares) | 185,786 | ||||||||
Balance at Mar. 31, 2016 | $ 690 | $ 1 | $ 5,108 | $ 7,900 | $ (6,026) | $ (901) | $ 191 | 6,963 | |
Balance at Mar. 31, 2016 | $ 41 | $ 41 | |||||||
Balance (in shares) at Mar. 31, 2016 | 6,900,000 | 139,703,904 |
BASIS OF PRESENTATION AND PRINC
BASIS OF PRESENTATION AND PRINCIPLES OF CONSOLIDATION | 3 Months Ended |
Mar. 31, 2016 | |
BASIS OF PRESENTATION AND PRINCIPLES OF CONSOLIDATION | |
BASIS OF PRESENTATION AND PRINCIPLES OF CONSOLIDATION | 1. BASIS OF PRESENTATION AND PRINCIPLES OF CONSOLIDATION The accompanying unaudited condensed consolidated financial statements include the accounts of Bunge Limited (“Bunge”), its subsidiaries and variable interest entities (“VIEs”) in which Bunge is considered to be the primary beneficiary, and as a result, include the assets, liabilities, revenues and expenses of all entities over which Bunge exercises control. The financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial information and the instructions to Form 10-Q and Article 10 of Regulation S-X under the Securities Exchange Act of 1934, as amended (“Exchange Act”). Certain information and footnote disclosures normally included in annual financial statements prepared in accordance with U.S. GAAP have been condensed or omitted pursuant to Securities and Exchange Commission (“SEC”) rules. In the opinion of management, all adjustments (consisting of normal recurring adjustments) necessary for a fair presentation have been included. The condensed consolidated balance sheet at December 31, 2015 has been derived from Bunge’s audited consolidated financial statements at that date. Operating results for the three months ended March 31, 2016 are not necessarily indicative of the results to be expected for the year ending December 31, 2016. The financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto for the year ended December 31, 2015, forming part of Bunge’s 2015 Annual Report on Form 10-K filed with the SEC on February 25, 2016. Reclassifications — Certain prior year amounts have been reclassified to conform to current year presentation. |
ACCOUNTING PRONOUNCEMENTS
ACCOUNTING PRONOUNCEMENTS | 3 Months Ended |
Mar. 31, 2016 | |
ACCOUNTING PRONOUNCEMENTS | |
ACCOUNTING PRONOUNCEMENTS | 2. ACCOUNTING PRONOUNCEMENTS New Accounting Pronouncements — In March 2016, the Financial Accounting Standards Board (FASB) issued ASU 2016-09, Compensation — Stock Compensation, Improvements to Employee Share-Based Payment Accounting (Topic 718) . This update identifies areas for simplification involving several aspects of accounting for share-based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities, an option to recognize gross stock compensation expense with actual forfeitures recognized as they occur, as well as certain classifications on the statement of cash flows. The new standard is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2016. Bunge is evaluating the expected impact of this standard on its consolidated financial statements. In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) . Under the new provisions, all lessees will report a right-of-use asset and a liability for the obligation to make payments with the exception of those leases with a term of 12 months or less. The new provisions will be effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. Early adoption is permitted. Bunge is evaluating the expected impact of this standard on its consolidated financial statements. In January 2016, the FASB issued ASU 2016-01, Other: Recognition and Measurement of Financial Assets and Financial Liabilities (Subtopic 825-10) , which amends the guidance relating to the classification and measurement of financial instruments. Changes to the current guidance primarily affect the accounting for equity investments, financial liabilities under the fair value option, and the presentation and disclosure requirements for financial instruments. The new standard is effective for fiscal years, including interim periods within those fiscal years, beginning after December 15, 2017. Early adoption is not permitted except for certain provisions. Bunge is evaluating the expected impact of this standard on its consolidated financial statements. In May 2014, the FASB amended ASC (Topic 605) Revenue Recognition and created ASC ( Topic 606 ) Revenue from Contracts with Customers . The core principle of the guidance is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The initial effective date is for interim and annual periods beginning on or after December 15, 2016, however, in August 2015, the FASB issued an ASU effectively deferring the implementation date by one year. In addition, the ASU permits companies to early adopt the guidance as of the original effective date, but not before January 1, 2017. The new requirements may be implemented either retrospectively for all prior periods presented, or retrospectively with a cumulative-effect adjustment at the date of initial application. Subsequent to the issuance of the original guidance in Topic 606, the FASB issued in March and April 2016, respectively, ASU 2016-08 Revenue from Contracts with Customers (Topic 606), Identifying Performance Obligations and Licensing and ASU 2016-10 Revenue from Contracts with Customers (Topic 606), Principal versus Agent Considerations (Reporting Revenue Gross versus Net) , to improve the guidance in that Topic. Bunge is evaluating the expected impact of the standard on its consolidated financial statements. Recently Adopted Accounting Pronouncements - In April 2015, the FASB issued ASU 2015-03 Interest - Imputation of Interest: Simplifying the Presentation of Debt Issuance Costs (Subtopic 835-30) . The amendments in this update require debt issuance costs related to a recognized debt liability to be presented in the balance sheet as a direct deduction from the carrying amount of the related debt liability, consistent with debt discounts, instead of being presented as an asset. Bunge adopted this ASU upon its effective date of January 1, 2016 and the adoption did not have a material impact on Bunge’s consolidated financial statements. In February 2015, the FASB issued ASU 2015-02 (Topic 810) Consolidation-Amendments to the Consolidation Analysis. The standard makes targeted amendments to the current consolidation guidance and ends the deferral granted to investment companies from applying the VIE guidance and requires companies to reevaluate all legal entities under revised consolidation guidance. The revised consolidation rules provide guidance for evaluating: i) limited partnerships and similar entities for consolidation, ii) how decision maker or service provider fees affect the consolidation analysis, iii) how interests held by related parties affect the consolidation analysis and iv) the consolidation analysis required for certain investment funds. The standard is effective for interim and annual reporting periods beginning after December 15, 2015. Bunge adopted ASU 2015-02 upon its effective date of January 1, 2016 using a modified retrospective approach. As a result of the initial application of ASU 2015-02, Bunge deconsolidated a Brazilian grain terminal and the remaining of its previously consolidated private equity and other investment funds. There was no cumulative effect to retained earnings as a result of the deconsolidation of these entities since there was no difference between the net amounts subtracted from Bunge’s financial statements and the retained interest in those entities. |
BUSINESS ACQUISITIONS
BUSINESS ACQUISITIONS | 3 Months Ended |
Mar. 31, 2016 | |
BUSINESS ACQUISITIONS | |
BUSINESS ACQUISITIONS | 3. BUSINESS ACQUISITIONS On January 29, 2016, SALIC Canada Limited (“SALIC”) received the final regulatory approval for its conversion of two non-interest bearing convertible promissory notes issued to SALIC by G3 of $106 million into 148,323,000 common shares. This conversion was completed on February 1, 2016 increasing SALIC’s ownership percentage in G3 from 49% to 65% and reducing Bunge Canada’s ownership in G3 from 51% to 35%. On the same day, Bunge Canada and SALIC transferred all of their common shares in the capital of G3 to G3 Global Holdings Limited Partnership in exchange for additional Class A limited partnership units in G3 Global Holdings Limited Partnership. As a result, as of February 1, 2016, G3 Global Holdings Limited Partnership became the holder of all of the issued and outstanding common shares in G3. On March 30, 2016, Bunge Canada, under the G3 Global Holdings Shareholders Agreement, exercised a contractual put right and sold 10% of its common shares to SALIC in exchange for $37 million of cash so that Bunge Canada now holds 25% ownership of G3 Global Holdings Limited Partnership and SALIC holds 75% ownership. |
TRADE STRUCTURED FINANCE PROGRA
TRADE STRUCTURED FINANCE PROGRAM | 3 Months Ended |
Mar. 31, 2016 | |
TRADE STRUCTURED FINANCE PROGRAM | |
TRADE STRUCTURED FINANCE PROGRAM | 4. TRADE STRUCTURED FINANCE PROGRAM Bunge engages in various trade structured finance activities to leverage the value of its trade flows across its operating regions. These activities include programs under which Bunge generally obtains U.S. dollar-denominated letters of credit (“LCs”) (each based on an underlying commodity trade flow) from financial institutions, and time deposits denominated in either the local currency of the financial institution counterparties or in U.S. dollar, as well as foreign exchange forward contracts, all of which are subject to legally enforceable set-off agreements. The LCs and foreign exchange contracts are presented within the line item letter of credit obligations under trade structured finance program on the condensed consolidated balance sheets as of March 31, 2016 and December 31, 2015. The net return from activities under this program, including fair value changes, is included as a reduction of cost of goods sold in the condensed consolidated statements of income. The table below summarizes the assets and liabilities included in the condensed consolidated balance sheets and the associated fair value amounts at March 31, 2016 and December 31, 2015, related to the program. The fair values approximated the carrying amount of the related financial instruments due to their short-term nature. March 31, December 31, (US$ in millions) 2016 2015 Assets: Carrying value of time deposits $ $ Fair value (Level 2 measurement) of time deposits $ $ Liabilities: Carrying value of letters of credit obligations and foreign exchange contracts $ $ Fair value (Level 2 measurement) of letters of credit obligations $ $ Fair value (Level 2 measurement) of foreign exchange forward contracts-(gains) losses — Total fair value (Level 2 measurement) of letters of credit obligations and foreign exchange contracts $ $ As of March 31, 2016 and December 31, 2015, time deposits, LCs, and foreign exchange contracts of $3,580 million and $3,394 million, respectively, were presented net on the condensed consolidated balance sheets as the criteria of ASC 210-20, Offsetting , had been met. At March 31, 2016 and December 31, 2015, time deposits, including those presented on a net basis, carried weighted-average interest rates of 2.29% and 2.21%, respectively. During the three months ended March 31, 2016 and 2015, total net proceeds from issuances of LCs were $1,396 million and $1,922 million, respectively. These cash inflows are offset by the related cash outflows resulting from placement of the time deposits and repayment of the LCs. All cash flows related to the programs are included in operating activities in the condensed consolidated statements of cash flows. |
INVENTORIES
INVENTORIES | 3 Months Ended |
Mar. 31, 2016 | |
INVENTORIES | |
INVENTORIES | 5. INVENTORIES Inventories by segment are presented below. Readily marketable inventories (“RMI”) are agricultural commodity inventories carried at fair value, which are non-perishable with a high shelf life and exceptionally liquid due to their homogenous nature and widely available markets with international pricing mechanisms. All other inventories are carried at lower of cost or market. March 31, December 31, (US$ in millions) 2016 2015 Agribusiness (1) $ $ Edible Oil Products (2) Milling Products Sugar and Bioenergy (3) Fertilizer Total $ $ (1) Includes RMI of $3,769 million and $3,393 million at March 31, 2016 and December 31, 2015, respectively. Of these amounts $2,877 million and $2,513 million can be attributable to merchandising activities at March 31, 2016 and December 31, 2015, respectively. (2) Includes RMI of bulk soybean and canola oil in the aggregate amount of $108 million and $110 million at March 31, 2016 and December 31, 2015, respectively. (3) Includes sugar RMI, which can be attributable to Bunge’s trading and merchandising business of $80 million and $163 million at March 31, 2016 and December 31, 2015, respectively. |
OTHER CURRENT ASSETS
OTHER CURRENT ASSETS | 3 Months Ended |
Mar. 31, 2016 | |
OTHER CURRENT ASSETS | |
OTHER CURRENT ASSETS | 6. OTHER CURRENT ASSETS Other current assets consist of the following: March 31, December 31, (US$ in millions) 2016 2015 Prepaid commodity purchase contracts (1) $ $ Secured advances to suppliers, net (2) Unrealized gains on derivative contracts, at fair value Recoverable taxes, net Margin deposits Marketable securities, at fair value and other short-term investments Deferred purchase price receivable, at fair value (3) Prepaid expenses Other Total $ $ (1) Prepaid commodity purchase contracts represent advance payments against fixed price contracts for future delivery of specified quantities of agricultural commodities. (2) Bunge provides cash advances to suppliers, primarily Brazilian farmers of soybeans and sugarcane, to finance a portion of the suppliers’ production costs. Bunge does not bear any of the costs or risks associated with the related growing crops. The advances are largely collateralized by future crops and physical assets of the suppliers, carry a local market interest rate and settle when the farmer’s crop is harvested and sold. The secured advances to farmers are reported net of allowances of $2 million at March 31, 2016 and December 31, 2015. Interest earned on secured advances to suppliers of $11 million for each of the three months ended March 31, 2016 and 2015 is included in net sales in the condensed consolidated statements of income. (3) Deferred purchase price receivable represents additional credit support for the investment conduits in Bunge’s accounts receivables sales program (see Note 12). Marketable Securities and Other Short-Term Investments - The Company invests in foreign government securities, corporate debt securities, deposits, and other securities. The following is a summary of amounts recorded on the condensed consolidated balance sheets for marketable securities and other short-term investments. March 31, December 31, (US$ in millions) 2016 2015 Foreign government securities $ $ Corporate debt securities Certificate of deposits/time deposits Other — Total marketable securities and other short-term investments $ $ As of March 31, 2016, total marketable securities and other short-term investments includes $159 million of assets classified as held-to-maturity and $185 million as trading. As of December 31, 2015, total marketable securities and other short-term investments includes $76 million of assets classified as held-to-maturity and $158 million as trading. Held-to-maturity foreign government and corporate debt securities and certificate of deposits/time deposits are expected to be converted to cash within a twelve month period and are therefore classified as current. Due to the short term nature of these investments, carrying value approximates fair value. For the three months ended March 31, 2016 and 2015, we recognized a net gain of $8 million and $7 million, respectively, related to trading securities. |
OTHER NON-CURRENT ASSETS
OTHER NON-CURRENT ASSETS | 3 Months Ended |
Mar. 31, 2016 | |
OTHER NON-CURRENT ASSETS | |
OTHER NON-CURRENT ASSETS | 7. OTHER NON-CURRENT ASSETS Other non-current assets consist of the following: March 31, December 31, (US$ in millions) 2016 2015 Recoverable taxes, net (1) $ $ Judicial deposits (1) Other long-term receivables Income taxes receivable (1) Long-term investments Affiliate loans receivable, net Long-term receivables from farmers in Brazil, net (1) Other Total $ $ (1) These non-current assets arise primarily from Bunge’s Brazilian operations and their realization could take in excess of five years. Recoverable taxes, net- Recoverable taxes are reported net of valuation allowances of $22 million and $20 million at March 31, 2016 and December 31, 2015, respectively. Judicial deposits- Judicial deposits are funds that Bunge has placed on deposit with the courts in Brazil. These funds are held in judicial escrow relating to certain legal proceedings pending legal resolution and bear interest at the SELIC rate, which is the benchmark rate of the Brazilian central bank. Income taxes receivable- Income taxes receivable includes overpayments of current income taxes plus accrued interest. These income tax prepayments are expected to be utilized for settlement of future income tax obligations. Income taxes receivable in Brazil bear interest at the SELIC rate. Affiliate loans receivable, net- Affiliate loans receivable, net is primarily interest bearing receivables from unconsolidated affiliates with an initial maturity of greater than one year. Long-term receivables from farmers in Brazil, net- Bunge provides financing to farmers in Brazil, primarily through secured advances against farmer commitments to deliver agricultural commodities (primarily soybeans) upon harvest of the then-current year’s crop and through credit sales of fertilizer to farmers. The table below summarizes Bunge’s recorded investment in long-term receivables from farmers in Brazil. March 31, December 31, (US$ in millions) 2016 2015 Legal collection process (1) $ $ Renegotiated amounts (2) Other long-term receivables Total $ $ (1) All amounts in legal process are considered past due upon initiation of legal action. (2) All renegotiated amounts are current on repayment terms. The average recorded investment in long-term receivables from farmers in Brazil for the three months ended March 31, 2016 and the year ended December 31, 2015 was $221 million and $214 million, respectively. The table below summarizes Bunge’s recorded investment in long-term receivables from farmers in Brazil and the related allowance amounts. March 31, 2016 December 31, 2015 Recorded Recorded (US$ in millions) Investment Allowance Investment Allowance For which an allowance has been provided: Legal collection process $ $ $ $ Renegotiated amounts For which no allowance has been provided: Legal collection process — — Renegotiated amounts — — Other long-term receivables — — Total $ $ $ $ The table below summarizes the activity in the allowance for doubtful accounts related to long-term receivables from farmers in Brazil. Three Months Ended March 31, (US$ in millions) 2016 2015 Beginning balance $ $ Bad debt provisions — Recoveries — ) Transfers (1) — Foreign exchange translation ) Ending balance $ $ (1) Represents reclassifications from allowance for doubtful accounts-current for secured advances to suppliers. |
INCOME TAXES
INCOME TAXES | 3 Months Ended |
Mar. 31, 2016 | |
INCOME TAXES | |
INCOME TAXES | 8. INCOME TAXES Income tax expense is provided on an interim basis based on management’s estimate of the annual effective income tax rate and includes the tax effects of certain discrete items, such as changes in tax laws or tax rates or other unusual or nonrecurring tax adjustments in the interim period in which they occur. In addition, jurisdictions with a projected loss for the year or a year-to-date loss where no tax benefit can be recognized are excluded from the estimated annual effective tax rate. The effective tax rate is highly dependent on the geographic distribution of Bunge’s worldwide earnings or losses and tax regulations in each jurisdiction. Management regularly monitors the assumptions used in estimating its annual effective tax rate and adjusts estimates accordingly. If actual results differ from management’s estimates, reported income tax expense in future periods could be materially affected. For the three months ended March 31, 2016 and 2015, income tax expense related to continuing operations was $34 million and $85 million, respectively, resulting in effective tax rates of 12% and 26%. The lower rate in 2016 was primarily due to certain discrete items including an income tax benefit of $60 million recorded for a change in estimate resulting from a tax election for North America partially offset by an income tax charge of $32 million recorded for an uncertain tax position related to Asia. Excluding the effect of the two discrete items noted above and certain other discrete items our effective tax rate for the three months ended March 31, 2016 was 27%. As a global enterprise, Bunge files income tax returns that are subject to periodic examination and challenge by federal, state and foreign tax authorities. In many jurisdictions, income tax examinations, including settlement negotiations or litigation, may take several years to finalize. While it is difficult to predict the final outcome or timing of resolution of any particular matter, management believes that the condensed consolidated financial statements reflect the largest amount of tax benefit that is more likely than not to be realized. |
OTHER CURRENT LIABILITIES
OTHER CURRENT LIABILITIES | 3 Months Ended |
Mar. 31, 2016 | |
OTHER CURRENT LIABILITIES | |
OTHER CURRENT LIABILITIES | 9. OTHER CURRENT LIABILITIES Other current liabilities consist of the following: March 31, December 31, (US$ in millions) 2016 2015 Accrued liabilities $ $ Unrealized losses on derivative contracts at fair value Advances on sales Other Total $ $ |
FINANCIAL INSTRUMENTS AND FAIR
FINANCIAL INSTRUMENTS AND FAIR VALUE MEASUREMENTS | 3 Months Ended |
Mar. 31, 2016 | |
FINANCIAL INSTRUMENTS AND FAIR VALUE MEASUREMENTS | |
FINANCIAL INSTRUMENTS AND FAIR VALUE MEASUREMENTS | 10. FINANCIAL INSTRUMENTS AND FAIR VALUE MEASUREMENTS Bunge’s various financial instruments include certain components of working capital such as cash and cash equivalents, trade accounts receivable and trade accounts payable. Additionally, Bunge uses short and long-term debt to fund operating requirements . Cash and cash equivalents, trade accounts receivable, trade accounts payable and short-term debt are stated at their carrying value, which is a reasonable estimate of fair value. See Note 12 for deferred purchase price receivable (“DPP”) related to sales of trade receivables. See Note 7 for long-term receivables from farmers in Brazil, net and other long-term investments and Note 11 for long-term debt. Bunge’s financial instruments also include derivative instruments and marketable securities, which are stated at fair value. The majority of Bunge’s exchange traded agricultural commodity futures are settled daily generally through its clearing subsidiary and, therefore, such futures are not included in the table below. Assets and liabilities are classified in their entirety based on the lowest level of input that is a significant component of the fair value measurement. The lowest level of input is considered Level 3. The following table sets forth, by level, Bunge’s assets and liabilities that were accounted for at fair value on a recurring basis. Fair Value Measurements at Reporting Date March 31, 2016 December 31, 2015 (US$ in millions) Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Total Assets: Readily marketable inventories (Note 5) $ — $ $ $ $ — $ $ $ Trade accounts receivable (1) — — Unrealized gain on designated derivative contracts (2) : Interest rate — — — — — — Foreign exchange — — — Unrealized gain on undesignated derivative contracts (2) : Foreign exchange — — Commodities Freight — — — Energy — — — Deferred purchase price receivable (Note 12) — — — — Other (3) — — Total assets $ $ $ $ $ $ $ $ Liabilities: Trade accounts payable (1) $ — $ $ $ $ — $ $ $ Unrealized loss on designated derivative contracts (4) : Interest rate — — — — — — Foreign exchange — — — — Unrealized loss on undesignated derivative contracts (4) : Interest rate — — — — — — Foreign exchange — — — Commodities Freight — — — Energy — Total liabilities $ $ $ $ $ $ $ $ (1) Trade accounts receivable and payable are generally stated at historical amounts, net of write-offs and allowances, with the exception of $10 million and $639 million, at March 31, 2016 and $6 million and $443 million at December 31, 2015, respectively, related to certain delivered inventory for which the receivable and payable, respectively, fluctuate based on changes in commodity prices. These receivables and payables are hybrid financial instruments for which Bunge has elected the fair value option. (2) Unrealized gains on designated and undesignated derivative contracts are generally included in other current assets. There are no such amounts included in other non-current assets at March 31, 2016 and December 31, 2015, respectively. (3) Other includes the fair values of marketable securities and investments in other current assets and other non-current assets. (4) Unrealized losses on designated and undesignated derivative contracts are generally included in other current liabilities. There are no such amounts included in other non-current liabilities at March 31, 2016 and December 31, 2015, respectively. Derivatives — Exchange traded futures and options contracts are valued based on unadjusted quoted prices in active markets and are classified within Level 1. Bunge’s forward commodity purchase and sale contracts are classified as derivatives along with other over-the-counter (“OTC”) derivative instruments relating primarily to freight, energy, foreign exchange and interest rates, and are classified within Level 2 or Level 3 as described below. Bunge estimates fair values based on exchange quoted prices, adjusted as appropriate for differences in local markets. These differences are generally valued using inputs from broker or dealer quotations, or market transactions in either the listed or OTC markets. In such cases, these derivative contracts are classified within Level 2. OTC derivative contracts include swaps, options and structured transactions that are valued at fair value generally determined using quantitative models that require the use of multiple market inputs including quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets which are not highly active, other observable inputs relevant to the asset or liability, and market inputs corroborated by correlation or other means. These valuation models include inputs such as interest rates, prices and indices to generate continuous yield or pricing curves and volatility factors. Where observable inputs are available for substantially the full term of the asset or liability, the instrument is categorized in Level 2. Certain OTC derivatives trade in less active markets with less availability of pricing information and certain structured transactions can require internally developed model inputs that might not be observable in or corroborated by the market. When unobservable inputs have a significant impact on the measurement of fair value, the instrument is categorized in Level 3. Exchange traded or cleared derivative contracts are classified in Level 1, thus transfers of assets and liabilities into and/or out of Level 1 occur infrequently. Transfers into Level 1 would generally only be expected to occur when an exchange cleared derivative contract historically valued using a valuation model as the result of a lack of observable inputs becomes sufficiently observable, resulting in the valuation price being essentially the exchange traded price. There were no significant transfers into or out of Level 1 during the periods presented. Readily marketable inventories — RMI reported at fair value are valued based on commodity futures exchange quotations, broker or dealer quotations, or market transactions in either listed or OTC markets with appropriate adjustments for differences in local markets where Bunge’s inventories are located. In such cases, the inventory is classified within Level 2. Certain inventories may utilize significant unobservable data related to local market adjustments to determine fair value. In such cases, the inventory is classified as Level 3. If Bunge used different methods or factors to determine fair values, amounts reported as unrealized gains and losses on derivative contracts and RMI at fair value in the consolidated balance sheets and consolidated statements of income could differ. Additionally, if market conditions change subsequent to the reporting date, amounts reported in future periods as unrealized gains and losses on derivative contracts and RMI at fair value in the consolidated balance sheets and consolidated statements of income could differ. Level 3 Measurements — Transfers in and/or out of Level 3 represent existing assets or liabilities that were either previously categorized as a higher level for which the inputs to the model became unobservable or assets and liabilities that were previously classified as Level 3 for which the lowest significant input became observable during the period. Bunge’s policy regarding the timing of transfers between levels is to record the transfers at the beginning of the reporting period. Level 3 Derivatives — Level 3 derivative instruments utilize both market observable and unobservable inputs within the fair value measurements. These inputs include commodity prices, price volatility, interest rates, volumes and locations. In addition, with the exception of the exchange cleared instruments, Bunge is exposed to loss in the event of the non-performance by counterparties on OTC derivative instruments and forward purchase and sale contracts. Adjustments are made to fair values on occasions when non-performance risk is determined to represent a significant input in Bunge’s fair value determination. These adjustments are based on Bunge’s estimate of the potential loss in the event of counterparty non-performance. Bunge did not have significant adjustments related to non-performance by counterparties at March 31, 2016 and December 31, 2015. Level 3 Readily marketable inventories and other — The significant unobservable inputs resulting in Level 3 classification for RMI physically settled forward purchase and sale contracts, and trade accounts receivable and payable, net, relate to certain management estimations regarding costs of transportation and other local market or location-related adjustments, primarily freight related adjustments in the interior of Brazil and the lack of market corroborated information in Canada. In both situations, Bunge uses proprietary information such as purchase and sale contracts and contracted prices for freight, premiums and discounts to value its contracts. Movements in the price of these unobservable inputs alone would not have a material effect on Bunge’s financial statements as these contracts do not typically exceed one future crop cycle. The tables below present reconciliations for assets and liabilities measured at fair value on a recurring basis using significant unobservable inputs (Level 3) during the three months ended March 31, 2016 and 2015. These instruments were valued using pricing models that management believes reflect the assumptions that would be used by a marketplace participant. Level 3 Instruments Fair Value Measurements Three Months Ended March 31, 2016 Readily Trade Accounts Derivatives, Marketable Receivable/ (US$ in millions) Net (1) Inventories Payable, Net (2) Total Balance, January 1, 2016 $ $ $ ) $ Total gains and (losses), realized/unrealized included in cost of goods sold ) ) Purchases — ) Sales — ) — ) Issuances — — — Settlements ) — — ) Transfers into Level 3 ) Transfers out of Level 3 ) ) Balance, March 31, 2016 $ $ $ ) $ (1) Derivatives, net include Level 3 derivative assets and liabilities. (2) Trade Accounts Receivable and Trade Accounts Payable, net, include Level 3 inventory related receivables and payables. Level 3 Instruments Fair Value Measurements Three Months Ended March 31, 2015 Readily Trade Accounts Derivatives, Marketable Receivable/ (US$ in millions) Net (1) Inventories Payable, Net (2) Total Balance, January 1, 2015 $ ) $ $ ) $ Total gains and (losses), realized/unrealized included in cost of goods sold — Purchases — ) Sales — ) — ) Issuances — — ) ) Settlements ) — — ) Transfers into Level 3 ) Transfers out of Level 3 ) ) Balance, March 31, 2015 $ $ $ ) $ (1) Derivatives, net include Level 3 derivative assets and liabilities. (2) Trade Accounts Receivable and Trade Accounts Payable, net, include Level 3 inventory related receivables and payables. The tables below summarize changes in unrealized gains or (losses) recorded in earnings during the three months ended March 31, 2016 and 2015 for Level 3 assets and liabilities that were held at March 31, 2016 and 2015: Level 3 Instruments Fair Value Measurements Three Months Ended Readily Trade Accounts Derivatives, Marketable Receivable and (US$ in millions) Net (1) Inventories Payable, Net (2) Total Changes in unrealized gains and (losses) relating to assets and liabilities held at March 31, 2016 Cost of goods sold $ ) $ ) $ $ ) Changes in unrealized gains and (losses) relating to assets and liabilities held at March 31, 2015 Cost of goods sold $ $ ) $ — $ (1) Derivatives, net include Level 3 derivative assets and liabilities. (2) Trade Accounts Receivable and Trade Accounts Payable, net, include Level 3 inventory related receivables and payables. Derivative Instruments Interest rate derivatives — Bunge, from time-to-time uses interest rate derivatives, including interest rate swaps, interest rate basis swaps, interest rate options or interest rate futures. During 2015, Bunge entered into interest rate swap agreements for the purpose of managing certain of its interest rate exposures. The interest rate swaps used by Bunge as hedging instruments have been recorded at fair value in the condensed consolidated balance sheets with changes in fair value recorded contemporaneously in earnings. These swap agreements have been designated as fair value hedges. Additionally, the carrying amount of the associated hedged debt is adjusted through earnings for changes in the fair value arising from changes in benchmark interest rates. Ineffectiveness is recognized to the extent that these two adjustments do not offset. In February 2016, Bunge entered into one year interest rate swap agreements, having a total notional of $500 million that requires Bunge to pay interest at a fixed rate and receive interest at a variable rate. The interest rate swaps do not qualify for hedge accounting, and therefore Bunge has not designated these swaps as hedge instruments for accounting purposes. The interest rate swaps have been recorded at fair value in the consolidated condensed balance sheets with changes in fair value recorded contemporaneously in earnings. As of March 31, 2016, Bunge had fixed-to-variable interest rate swap agreements having a total notional amount of $500 million that requires Bunge to pay interest at a variable rate and receive interest at 3.5%. These interest rate swap agreements are designated as fair value hedges of $500 million of its 3.5% 2020 Senior Notes. March 31, 2016 Notional Amount of Notional Amount (US$ in millions) Hedged Obligation Derivative (3) Interest rate swap agreements $ $ Weighted average rate payable - 3 month LIBOR plus 1.91% (1) Weighted average rate receivable - 3.5% (2) (1) Interest is payable in arrears semi-annually based on three-month U.S. dollar LIBOR plus 1.91%. (2) Interest is receivable in arrears based on a fixed interest rate of 3.5%. (3) The interest rate swap agreements mature in 2020. Foreign exchange derivatives - Bunge uses a combination of foreign exchange forward, swap and option contracts in certain of its operations to mitigate the risk from exchange rate fluctuations in connection with certain commercial and balance sheet exposures. The foreign exchange forward and option contracts may be designated as cash flow hedges. Bunge may also use net investment hedges to partially offset the translation adjustments arising from the remeasurement of its investment in certain of its foreign subsidiaries. Bunge assesses, both at the inception of the hedge and on an ongoing basis, whether the derivatives that are used in hedge transactions are highly effective in offsetting changes in the hedged items. The table below summarizes the notional amounts of open foreign exchange positions. March 31, 2016 Exchange Traded Net (Short) Non-exchange Traded Unit of (US$ in millions) & Long (1) (Short) (2) Long (2) Measure Foreign Exchange Options $ — $ ) $ Delta Forwards — ) Notional Futures — — Notional Swaps — ) Notional (1) Exchange traded derivatives are presented on a net (short) and long position basis. (2) Non-exchange traded derivatives are presented on a gross (short) and long position basis. Commodity derivatives - Bunge uses commodity derivative instruments to manage its exposure to movements associated with agricultural commodity prices. Bunge generally uses exchange traded futures and options contracts to minimize the effects of changes in the prices of agricultural commodities on its agricultural commodity inventories and forward purchase and sale contracts, but may also from time-to-time enter into OTC commodity transactions, including swaps, which are settled in cash at maturity or termination based on exchange-quoted futures prices. Forward purchase and sale contracts are primarily settled through delivery of agricultural commodities. While Bunge considers these exchange traded futures and forward purchase and sale contracts to be effective economic hedges, Bunge does not designate or account for the majority of its commodity contracts as hedges. The forward contracts require performance of both Bunge and the contract counterparty in future periods. Contracts to purchase agricultural commodities generally relate to current or future crop years for delivery periods quoted by regulated commodity exchanges. Contracts for the sale of agricultural commodities generally do not extend beyond one future crop cycle. The table below summarizes the volumes of open agricultural commodities derivative positions. March 31, 2016 Exchange Traded Net (Short) & Non-exchange Traded Unit of Long (1) (Short) (2) Long (2) Measure Agricultural Commodities Futures ) — — Metric Tons Options ) ) — Metric Tons Forwards — ) Metric Tons Swaps — ) Metric Tons (1) Exchange traded derivatives are presented on a net (short) and long position basis. (2) Non-exchange traded derivatives are presented on a gross (short) and long position basis. Ocean freight derivatives — Bunge uses derivative instruments referred to as freight forward agreements (FFAs) and FFA options to hedge portions of its current and anticipated ocean freight costs. Changes in the fair values of ocean freight derivatives that are not designated as hedges are recorded in earnings. There were no designated hedges at March 31, 2016 and December 31, 2015, respectively. The table below summarizes the open ocean freight positions. March 31, 2016 Exchange Cleared Net (Short) & Non-exchange Cleared Unit of Long (1) (Short) (2) Long (2) Measure Ocean Freight FFA — — Hire Days FFA Options ) — — Hire Days (1) Exchange cleared derivatives are presented on a net (short) and long position basis. (2) Non-exchange cleared derivatives are presented on a gross (short) and long position basis. Energy derivatives — Bunge uses energy derivative instruments for various purposes including to manage its exposure to volatility in energy costs. Bunge’s operations use substantial amounts of energy, including natural gas, coal, and fuel oil, including bunker fuel. The table below summarizes the open energy positions. March 31, 2016 Exchange Traded Net (Short) & Non-exchange Cleared Unit of Long (1) (Short) (2) Long (2) Measure (3) Natural Gas (3) Futures — — MMBtus Swaps — — MMBtus Options — — — MMBtus Energy—Other Futures ) — — Metric Tons Forwards — — Metric Tons Swaps — — Metric Tons Options — — — Metric Tons (1) Exchange traded and cleared derivatives are presented on a net (short) and long position basis. (2) Non-exchange cleared derivatives are presented on a gross (short) and long position basis. (3) Million British Thermal Units (MMBtus) is the standard unit of measurement used to denote an amount of natural gas. The Effect of Derivative Instruments on the Condensed Consolidated Statements of Income The table below summarizes the effect of derivative instruments that are designated as fair value hedges and also derivative instruments that are undesignated on the condensed consolidated statements of income for the three months ended March 31, 2016 and 2015. Gain or (Loss) Recognized in Income on Derivative Instruments Three Months Ended March 31, (US$ in millions) Location 2016 2015 Undesignated Derivative Contracts: Foreign Exchange Foreign exchange gains (losses) $ $ ) Foreign Exchange Cost of goods sold ) Commodities Cost of goods sold ) Freight Cost of goods sold ) Energy Cost of goods sold ) ) Total $ $ ) The table below summarizes the effect of derivative instruments that are designated and qualify as cash flow and net investment hedges on the condensed consolidated statement of income three months ended March 31, 2016 . Three Months Ended March 31, 2016 Gain or Gain or (Loss) (Loss) Reclassified from Recognized in Accumulated OCI into Gain or (Loss) Recognized Notional Accumulated Income (1) in Income on Derivatives (US$ in millions) Amount OCI (1) Location Amount Location Amount (2) Cash Flow Hedge: Foreign Exchange (3) $ $ Foreign exchange gains (losses) $ ) Foreign exchange gains (losses) $ — Total $ $ $ ) $ — Net Investment Hedge: Foreign Exchange (3) $ $ ) Foreign exchange gains (losses) $ — Foreign exchange gains (losses) $ — Total $ $ ) $ — $ — (1) The gain (loss) recognized relates to the effective portion of the hedging relationship. At March 31, 2016, Bunge expects to reclassify into income in the next 12 months approximately $ 16 million of after-tax gain (loss) related to its foreign exchange cash flow hedges and zero for net investment hedges. (2) There was no gain or loss recognized in income relating to the ineffective portion of the hedging relationships or relating to amounts excluded from the assessment of hedge effectiveness. (3) The foreign exchange contracts mature at various dates through November 2020. The table below summarizes the effect of derivative instruments that are designated and qualify as cash flow hedges on the condensed consolidated statement of income for the three months ended March 31, 2015. Three Months Ended March 31, 2015 Gain or Gain or (Loss) (Loss) Reclassified from Recognized in Accumulated OCI into Gain or (Loss) Recognized Notional Accumulated Income (1) in Income on Derivatives (US$ in millions) Amount OCI (1) Location Amount Location Amount (2) Cash Flow Hedge: Foreign Exchange (3) $ $ ) Foreign exchange gains (losses) $ ) Foreign exchange gains (losses) $ — Total $ $ ) $ ) $ — Net Investment Hedge: Foreign Exchange (3) $ $ Foreign exchange gains (losses) $ — Foreign exchange gains (losses) $ — Total $ $ $ — $ — (1) The gain or (loss) recognized relates to the effective portion of the hedging relationship. At March 31, 2015, Bunge expected to reclassify into income in the next 12 months approximately $(53) million of after-tax gains (losses) related to its foreign exchange cash flow hedges. (2) There was no gain or loss recognized in income relating to the ineffective portion of the hedging relationships or to amounts excluded from the assessment of hedge effectiveness. (3) The foreign exchange contracts matured at various dates in 2015 and 2016. |
DEBT
DEBT | 3 Months Ended |
Mar. 31, 2016 | |
DEBT | |
DEBT | 11. DEBT Bunge’s commercial paper program is supported by an identical amount of committed back-up bank credit lines (the “Liquidity Facility”) provided by banks that are rated at least A-1 by Standard & Poor’s Financial Services and P-1 by Moody’s Investors Service. The cost of borrowing under the Liquidity Facility would typically be higher than the cost of issuing under Bunge’s commercial paper program. At March 31, 2016, there was $150 million outstanding under the commercial paper program and no borrowings were outstanding under the Liquidity Facility. At March 31, 2016, Bunge had $3,313 million of unused and available borrowing capacity under its committed credit facilities with a number of lending institutions. The fair value of Bunge’s long-term debt is based on interest rates currently available on comparable maturities to companies with credit standing similar to that of Bunge. The carrying amounts and fair value of long-term debt are as follows: March 31, 2016 December 31, 2015 Carrying Fair Value Fair Value Carrying Fair Value Fair Value (US$ in millions) Value (Level 2) (Level 3) Value (Level 2) (Level 3) Long-term debt, including current portion $ $ $ — $ $ $ |
TRADE RECEIVABLES SECURITIZATIO
TRADE RECEIVABLES SECURITIZATION PROGRAM | 3 Months Ended |
Mar. 31, 2016 | |
TRADE RECEIVABLES SECURITIZATION PROGRAM | |
TRADE RECEIVABLES SECURITIZATION PROGRAM | 12. TRADE RECEIVABLES SECURITIZATION PROGRAM Bunge and certain of its subsidiaries participate in a trade receivables securitization program (the “Program”) with a financial institution, as administrative agent, and certain commercial paper conduit purchasers and committed purchasers (collectively, the “Purchasers”) that provides for funding of up to $700 million against receivables sold into the Program. As of March 31, 2016 and December 31, 2015, $487 million and $524 million, respectively, of receivables sold under the Program were derecognized from Bunge’s condensed consolidated balance sheets. Proceeds received in cash related to transfers of receivables under the Program totaled $2,155 million and $2,517 million for the three months ended March 31, 2016 and 2015, respectively. In addition, cash collections from customers on receivables previously sold were $2,227 million and $2,686 million, respectively. As this is a revolving facility, cash collections from customers are reinvested to fund new receivable sales. Gross receivables sold under the Program for the three months ended March 31, 2016 and 2015, were $2,263 million and $2,609 million, respectively. These sales resulted in discounts of $2 million for each of the three months ended March 31, 2016 and 2015, which were included in SG&A in the condensed consolidated statements of income. Servicing fees under the Program were not significant in any period. Bunge’s risk of loss following the sale of the trade receivables is limited to the deferred purchase price (“DPP”), which at March 31, 2016 and December 31, 2015 had a fair value of $80 million and $79 million, respectively, and is included in other current assets in the condensed consolidated balance sheets (see Note 6). The DPP will be repaid in cash as receivables are collected, generally within 30 days. Delinquencies and credit losses on trade receivables sold under the Program during the three months ended March 31, 2016 and 2015, were insignificant. Bunge has reflected all cash flows under the Program as operating cash flows in the condensed consolidated statements of cash flows. |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 3 Months Ended |
Mar. 31, 2016 | |
RELATED PARTY TRANSACTIONS | |
RELATED PARTY TRANSACTIONS | 13. RELATED PARTY TRANSACTIONS Bunge purchased soybeans, other commodity products and received port services from certain of its unconsolidated investees, totaling $252 million and $270 million for the three months ended March 31, 2016 and 2015, respectively. Bunge also sold soybeans, other commodity products and provided port services to certain of its unconsolidated investees, totaling $56 million and $126 million for the three months ended March 31, 2016 and 2015, re s pectively. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 3 Months Ended |
Mar. 31, 2016 | |
COMMITMENTS AND CONTINGENCIES | |
COMMITMENTS AND CONTINGENCIES | 14. COMMITMENTS AND CONTINGENCIES Bunge is party to a large number of claims and lawsuits, primarily tax and labor claims in Brazil and tax claims in Argentina, arising in the normal course of business. The ability to predict the ultimate outcome of such matters involves judgments, estimates and inherent uncertainties. Bunge records liabilities related to its general claims and lawsuits when the exposure item becomes probable and can be reasonably estimated. Bunge management does not expect these matters to have a material adverse effect on Bunge’s financial condition, results of operations or liquidity. However, these matters are subject to inherent uncertainties and there exists the remote possibility of an adverse impact on Bunge’s position in the period the uncertainties are resolved whereby the settlement of the identified contingencies could exceed the amount of provisions included in the condensed consolidated balance sheets. Included in other non-current liabilities at March 31, 2016 and December 31, 2015 are the following amounts related to these matters: March 31, December 31, (US$ in millions) 2016 2015 Tax claims $ $ Labor claims Civil and other claims Total $ $ Tax claims (non-income tax) - These tax claims relate principally to claims against Bunge’s Brazilian subsidiaries, primarily value added tax claims (ICMS, IPI, PIS and COFINS). The determination of the manner in which various Brazilian federal, state and municipal taxes apply to the operations of Bunge is subject to varying interpretations arising from the complex nature of Brazilian tax law. In addition to the matter discussed below, Bunge monitors other potential claims in Brazil regarding these value-added taxes. In particular, Bunge monitors the Brazilian federal and state governments’ responses to recent Brazilian Supreme Court decisions invalidating on constitutional grounds certain ICMS incentives and benefits granted by various states. While Bunge was not a recipient of any of the incentives and benefits that were the subject of these Supreme Court decisions, it has received other similar tax incentives and benefits. Bunge has not received any tax assessment from the states that granted these incentives or benefits related to their validity and, based on the Company’s evaluation of this matter as required by U.S. GAAP, no liability has been recorded in the condensed consolidated financial statements. On February 13, 2015, Brazil’s Supreme Federal Court ruled in a leading case that certain state ICMS tax credits for staple foods (including soy oil, margarine, mayonnaise and wheat flours) are unconstitutional. Bunge, like other companies in the Brazilian food industry, is involved in several administrative and judicial disputes with Brazilian states regarding these tax credits. While the leading case does not involve Bunge and each case is unique in facts and circumstances and applicable state law, the ruling has general precedent authority on lower court cases. Based on management’s review of the ruling (without considering the future success of any potential clarification or modulation of the ruling) and its general application to Bunge’s pending cases, management recorded a liability of 468 million Brazilian reais (approximately $132 million as of March 31, 2016), plus applicable interest. Management intends to continue to vigorously defend against its pending state cases. As of March 31, 2016, Bunge’s Brazilian subsidiaries have received in excess of 150 ICMS assessments which ranged from less than 10 thousand Brazilian reais to 70 million Brazilian reais . In May 2014, the Brazilian tax authorities concluded an examination of the ICMS tax returns of one of Bunge’s sugar milling subsidiaries for the years 2010 through 2011 and proposed adjustments totaling approximately 45 million Brazilian reais (approximately $13 million as of March 31, 2016), plus applicable interest and penalties on the outstanding amount. Management, in consultation with external legal advisors, has determined that no reserves are required. As of December 31, 2015 the Brazilian authorities have concluded examinations of the PIS COFINS tax returns and issued assessments relating to years 2004 through 2010. As of March 31, 2016, the cumulative claims for 2004 through 2010 were approximately 500 million Brazilian reais (approximately $140 million), plus applicable interest and penalties on the outstanding amount. As of December 31, 2014, the claims for 2004 through 2009 were approximately 430 million Brazilian reais (approximately $121 million as of March 31, 2016), plus applicable interest and penalties on the outstanding amount. Management, in consultation with external legal advisors, has established appropriate reserves for potential exposures. Since 2010, the Argentine tax authorities have been conducting a review of income and other taxes paid by exporters and processors of cereals and other agricultural commodities in the country. In that regard, the Company has been subject to a number of assessments, proceedings and claims related to its activities. In 2011, Bunge’s subsidiary in Argentina paid $112 million of accrued export tax obligations under protest and preserved its rights with respect to such payment. In 2012, the Argentine tax authorities further assessed interest on these payments, which as of March 31, 2016, totaled approximately $212 million. In 2012, the Argentine government suspended Bunge’s Argentine subsidiary from a registry of grain traders. While the suspension has not had a material adverse effect on Bunge’s business in Argentina, these actions have resulted in additional administrative requirements and increased logistical costs on domestic grain shipments within Argentina. Bunge is challenging these actions in the Argentine courts. Labor claims — The labor claims are principally claims against Bunge’s Brazilian subsidiaries. The labor claims primarily relate to dismissals, severance, health and safety, salary adjustments and supplementary retirement benefits. Civil and other — The civil and other claims relate to various disputes with third parties, including suppliers and customers. During the first quarter of 2016, Bunge received a notice from the Brazilian Administrative Council for Economic Defense initiating an administrative proceeding against its Brazilian subsidiary and two of its employees, certain of its former employees, several other companies in the Brazilian wheat milling industry and others for alleged anticompetitive activities in the north and northeast of Brazil. Bunge intends to defend against this action; however, the proceedings are at an early stage and Bunge cannot, at this time, reasonably predict the ultimate outcome of the proceedings or sanctions, if any, which may be imposed. Guarantees — Bunge has issued or was a party to the following guarantees at March 31, 2016: Maximum Potential Future (US$ in millions) Payments Unconsolidated affiliates financing (1) $ Residual value guarantee (2) Total $ (1) Bunge issued guarantees to certain financial institutions related to debt of certain of its unconsolidated joint ventures. The terms of the guarantees are equal to the terms of the related financings which have maturity dates in 2016 through 2018. There are no recourse provisions or collateral that would enable Bunge to recover any amounts paid under these guarantees. At March 31, 2016, Bunge’s recorded obligation related to these guarantees was $4 million. (2) Bunge issued guarantees to certain financial institutions which are party to certain operating lease arrangements for railcars and barges. These guarantees provide for a minimum residual value to be received by the lessor at conclusion of the lease term. These leases expire at various dates from 2016 through 2020. At March 31, 2016, Bunge’s recorded obligation related to these guarantees was $5 million. In addition, Bunge Limited has provided full and unconditional parent level guarantees of the outstanding indebtedness under certain credit facilities entered into, and senior notes issued, by its subsidiaries. At March 31, 2016, Bunge’s condensed consolidated balance sheet includes debt with a carrying amount of $4,615 million related to these guarantees. This debt includes the senior notes issued by two of Bunge’s 100% owned finance subsidiaries, Bunge Limited Finance Corp. and Bunge N.A. Finance L.P. There are no significant restrictions on the ability of Bunge Limited Finance Corp., Bunge N.A. Finance L.P. or any other Bunge subsidiary to transfer funds to Bunge Limited. |
EQUITY
EQUITY | 3 Months Ended |
Mar. 31, 2016 | |
EQUITY | |
EQUITY | 15. EQUITY Share repurchase program - In May 2015, Bunge established a new program for the repurchase of up to $500 million of Bunge’s issued and outstanding common shares. The program has no expiration date. Bunge repurchased 2,965,349 common shares under this program for $181 million in the first quarter 2016. Total repurchases under the program from its inception in May 2015 through March 31, 2016 were 4,376,559 shares for $281 million. Bunge completed the previous program of $975 million during the first quarter of 2015 with the repurchase of 2,460,600 common shares for $200 million. Accumulated other comprehensive income (loss) attributable to Bunge — The following table summarizes the balances of related after-tax components of accumulated other comprehensive income (loss) attributable to Bunge: Deferred Pension and Other Unrealized Accumulated Foreign Exchange Gains (Losses) Postretirement Gains (Losses) Other Translation on Hedging Liability on Comprehensive (US$ in millions) Adjustment Activities Adjustments Investments Income (Loss) Balance January 1, 2016 $ ) $ $ ) $ $ ) Other comprehensive income (loss) before reclassifications ) — — Amount reclassified from accumulated other comprehensive income — — — Balance, March 31, 2016 $ ) $ $ ) $ $ ) Deferred Pension and Other Unrealized Accumulated Foreign Exchange Gains (Losses) Postretirement Gains (Losses) Other Translation on Hedging Liability on Comprehensive (US$ in millions) Adjustment Activities Adjustments Investments Income (Loss) Balance January 1, 2015 $ ) $ ) $ ) $ $ ) Other comprehensive income (loss) before reclassifications ) — ) Amount reclassified from accumulated other comprehensive income — — — Balance, March 31, 2015 $ ) $ $ ) $ $ ) |
EARNINGS PER COMMON SHARE
EARNINGS PER COMMON SHARE | 3 Months Ended |
Mar. 31, 2016 | |
EARNINGS PER COMMON SHARE | |
EARNINGS PER COMMON SHARE | 16. EARNINGS PER COMMON SHARE The following table sets forth the computation of basic and diluted earnings per common share. Three Months Ended March 31, (US$ in millions, except for share data) 2016 2015 Income (loss) from continuing operations $ $ Net (income) loss attributable to noncontrolling interests Income (loss) from continuing operations attributable to Bunge Other redeemable obligations (1) ) ) Convertible preference share dividends ) ) Income (loss) from discontinued operations, net of tax ) Net income (loss) available to Bunge common shareholders $ $ Weighted-average number of common shares outstanding: Basic Effect of dilutive shares: —stock options and awards (2) —convertible preference shares Diluted Basic earnings per common share: Net income (loss) from continuing operations $ $ Net income (loss) from discontinued operations ) Net income (loss) attributable to Bunge common shareholders—basic $ $ Diluted earnings per common share: Net income (loss) from continuing operations $ $ Net income (loss) from discontinued operations ) Net income (loss) attributable to Bunge common shareholders—diluted $ $ (1) Accretion of redeemable noncontrolling interest of $5 million and $6 million for the three months ended March 31, 2016 and 2015, respectively, relates to a non-fair value variable put arrangement whereby the noncontrolling interest holder may require Bunge to purchase the remaining shares of an oilseed processing operation in Central and Eastern Europe. Accretion for the respective periods includes the effect of losses incurred by the operations for the three months ended March 31, 2016, and 2015, respectively. (2) Approximately 7 million outstanding stock options and contingently issuable restricted stock units were not dilutive and not included in the weighted-average number of common shares outstanding for the three months ended March 31, 2016. Approximately 2 million outstanding stock options and contingently issuable restricted stock units were not dilutive and not included in the weighted-average number of common shares outstanding for the three months ended March 31, 2015. |
SEGMENT INFORMATION
SEGMENT INFORMATION | 3 Months Ended |
Mar. 31, 2016 | |
SEGMENT INFORMATION | |
SEGMENT INFORMATION | 17. SEGMENT INFORMATION Bunge has five reportable segments - Agribusiness, Edible Oil Products, Milling Products, Sugar and Bioenergy, and Fertilizer, which are organized based upon similar economic characteristics and are similar in nature of products and services offered, the nature of production processes, the type and class of customer and distribution methods. The Agribusiness segment is characterized by both inputs and outputs being agricultural commodities and thus high volume and low margin. The Edible Oil Products segment involves the processing, production and marketing of products derived from vegetable oils. The Milling Products segment involves the processing, production and marketing of products derived primarily from wheat and corn. The Sugar and Bioenergy segment involves sugarcane growing and milling in Brazil, sugar merchandising in various countries, as well as sugarcane-based ethanol production and corn-based ethanol investments and related activities. Following the classification of the Brazilian fertilizer distribution and North American fertilizer businesses as discontinued operations, the activities of the Fertilizer segment include its port operations in Brazil and Argentina and its blending and retail operations in Argentina. The “Discontinued Operations & Unallocated” column in the following table contains the reconciliation between the totals for reportable segments and Bunge consolidated totals, which consist primarily of amounts attributable to discontinued operations, corporate items not allocated to the operating segments and inter-segment eliminations. Transfers between the segments are generally valued at market. The revenues generated from these transfers are shown in the following table as “Inter-segment revenues” segments. (US$ in millions) Edible Discontinued Three Months Ended Oil Milling Sugar and Operations & March 31, 2016 Agribusiness Products Products Bioenergy Fertilizer Unallocated (1) Total Net sales to external customers $ $ $ $ $ $ — $ Inter—segment revenues — — ) — Gross profit — Foreign exchange gains (losses) ) ) — ) — Noncontrolling interests ) — — — Other income (expense) — net ) ) ) — — ) Segment EBIT (2) ) — Discontinued operations (3) — — — — — ) ) Depreciation, depletion and amortization ) ) ) ) ) — ) Total assets Three Months Ended March 31, 2015 Net sales to external customers $ $ $ $ $ $ — $ Inter—segment revenues — ) — Gross profit ) — Foreign exchange gains (losses) ) ) ) — — ) Noncontrolling interests ) — — — Other income (expense) — net — ) ) — — Segment EBIT (2) ) ) — Discontinued operations (3) — — — — — Depreciation, depletion and amortization ) ) ) ) ) — ) Total assets (1) Includes noncontrolling interests share of interest and tax to reconcile to consolidated noncontrolling interest and discontinued operations of Brazilian fertilizer distribution business and certain asset management operations. (2) Total segment earnings before interest and taxes (“EBIT”) is an operating performance measure used by Bunge’s management to evaluate segment operating activities. Bunge’s management believes total segment EBIT is a useful measure of operating profitability, since the measure allows for an evaluation of the performance of its segments without regard to its financing methods or capital structure. In addition, EBIT is a financial measure that is widely used by analysts and investors in Bunge’s industries. (3) Represents net income (loss) from discontinued operations. A reconciliation of total segment EBIT to net income attributable to Bunge follows: Three Months Ended March 31, (US$ in millions) 2016 2015 Total segment EBIT from continuing operations $ $ Interest income Interest expense ) ) Income tax (expense) benefit ) ) Income (loss) from discontinued operations, net of tax ) Noncontrolling interests’ share of interest and tax Net income (loss) attributable to Bunge $ $ |
BASIS OF PRESENTATION AND PRI26
BASIS OF PRESENTATION AND PRINCIPLES OF CONSOLIDATION (Policies) | 3 Months Ended |
Mar. 31, 2016 | |
BASIS OF PRESENTATION AND PRINCIPLES OF CONSOLIDATION | |
Basis of Presentation and Principles of Consolidation | BASIS OF PRESENTATION AND PRINCIPLES OF CONSOLIDATION The accompanying unaudited condensed consolidated financial statements include the accounts of Bunge Limited (“Bunge”), its subsidiaries and variable interest entities (“VIEs”) in which Bunge is considered to be the primary beneficiary, and as a result, include the assets, liabilities, revenues and expenses of all entities over which Bunge exercises control. The financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial information and the instructions to Form 10-Q and Article 10 of Regulation S-X under the Securities Exchange Act of 1934, as amended (“Exchange Act”). Certain information and footnote disclosures normally included in annual financial statements prepared in accordance with U.S. GAAP have been condensed or omitted pursuant to Securities and Exchange Commission (“SEC”) rules. In the opinion of management, all adjustments (consisting of normal recurring adjustments) necessary for a fair presentation have been included. The condensed consolidated balance sheet at December 31, 2015 has been derived from Bunge’s audited consolidated financial statements at that date. Operating results for the three months ended March 31, 2016 are not necessarily indicative of the results to be expected for the year ending December 31, 2016. The financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto for the year ended December 31, 2015, forming part of Bunge’s 2015 Annual Report on Form 10-K filed with the SEC on February 25, 2016. |
Reclassifications | Reclassifications — Certain prior year amounts have been reclassified to conform to current year presentation. |
ACCOUNTING PRONOUNCEMENTS (Poli
ACCOUNTING PRONOUNCEMENTS (Policies) | 3 Months Ended |
Mar. 31, 2016 | |
ACCOUNTING PRONOUNCEMENTS | |
New Accounting Pronouncements | New Accounting Pronouncements — In March 2016, the Financial Accounting Standards Board (FASB) issued ASU 2016-09, Compensation — Stock Compensation, Improvements to Employee Share-Based Payment Accounting (Topic 718) . This update identifies areas for simplification involving several aspects of accounting for share-based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities, an option to recognize gross stock compensation expense with actual forfeitures recognized as they occur, as well as certain classifications on the statement of cash flows. The new standard is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2016. Bunge is evaluating the expected impact of this standard on its consolidated financial statements. In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) . Under the new provisions, all lessees will report a right-of-use asset and a liability for the obligation to make payments with the exception of those leases with a term of 12 months or less. The new provisions will be effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. Early adoption is permitted. Bunge is evaluating the expected impact of this standard on its consolidated financial statements. In January 2016, the FASB issued ASU 2016-01, Other: Recognition and Measurement of Financial Assets and Financial Liabilities (Subtopic 825-10) , which amends the guidance relating to the classification and measurement of financial instruments. Changes to the current guidance primarily affect the accounting for equity investments, financial liabilities under the fair value option, and the presentation and disclosure requirements for financial instruments. The new standard is effective for fiscal years, including interim periods within those fiscal years, beginning after December 15, 2017. Early adoption is not permitted except for certain provisions. Bunge is evaluating the expected impact of this standard on its consolidated financial statements. In May 2014, the FASB amended ASC (Topic 605) Revenue Recognition and created ASC ( Topic 606 ) Revenue from Contracts with Customers . The core principle of the guidance is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The initial effective date is for interim and annual periods beginning on or after December 15, 2016, however, in August 2015, the FASB issued an ASU effectively deferring the implementation date by one year. In addition, the ASU permits companies to early adopt the guidance as of the original effective date, but not before January 1, 2017. The new requirements may be implemented either retrospectively for all prior periods presented, or retrospectively with a cumulative-effect adjustment at the date of initial application. Subsequent to the issuance of the original guidance in Topic 606, the FASB issued in March and April 2016, respectively, ASU 2016-08 Revenue from Contracts with Customers (Topic 606), Identifying Performance Obligations and Licensing and ASU 2016-10 Revenue from Contracts with Customers (Topic 606), Principal versus Agent Considerations (Reporting Revenue Gross versus Net) , to improve the guidance in that Topic. Bunge is evaluating the expected impact of the standard on its consolidated financial statements. |
Recently Adopted Accounting Pronouncements | Recently Adopted Accounting Pronouncements - In April 2015, the FASB issued ASU 2015-03 Interest - Imputation of Interest: Simplifying the Presentation of Debt Issuance Costs (Subtopic 835-30) . The amendments in this update require debt issuance costs related to a recognized debt liability to be presented in the balance sheet as a direct deduction from the carrying amount of the related debt liability, consistent with debt discounts, instead of being presented as an asset. Bunge adopted this ASU upon its effective date of January 1, 2016 and the adoption did not have a material impact on Bunge’s consolidated financial statements. In February 2015, the FASB issued ASU 2015-02 (Topic 810) Consolidation-Amendments to the Consolidation Analysis. The standard makes targeted amendments to the current consolidation guidance and ends the deferral granted to investment companies from applying the VIE guidance and requires companies to reevaluate all legal entities under revised consolidation guidance. The revised consolidation rules provide guidance for evaluating: i) limited partnerships and similar entities for consolidation, ii) how decision maker or service provider fees affect the consolidation analysis, iii) how interests held by related parties affect the consolidation analysis and iv) the consolidation analysis required for certain investment funds. The standard is effective for interim and annual reporting periods beginning after December 15, 2015. Bunge adopted ASU 2015-02 upon its effective date of January 1, 2016 using a modified retrospective approach. As a result of the initial application of ASU 2015-02, Bunge deconsolidated a Brazilian grain terminal and the remaining of its previously consolidated private equity and other investment funds. There was no cumulative effect to retained earnings as a result of the deconsolidation of these entities since there was no difference between the net amounts subtracted from Bunge’s financial statements and the retained interest in those entities. |
TRADE STRUCTURED FINANCE PROG28
TRADE STRUCTURED FINANCE PROGRAM (TABLES) | 3 Months Ended |
Mar. 31, 2016 | |
TRADE STRUCTURED FINANCE PROGRAM | |
Summary of assets and liabilities related to the trade structured finance program | March 31, December 31, (US$ in millions) 2016 2015 Assets: Carrying value of time deposits $ $ Fair value (Level 2 measurement) of time deposits $ $ Liabilities: Carrying value of letters of credit obligations and foreign exchange contracts $ $ Fair value (Level 2 measurement) of letters of credit obligations $ $ Fair value (Level 2 measurement) of foreign exchange forward contracts-(gains) losses — Total fair value (Level 2 measurement) of letters of credit obligations and foreign exchange contracts $ $ |
INVENTORIES (TABLES)
INVENTORIES (TABLES) | 3 Months Ended |
Mar. 31, 2016 | |
INVENTORIES | |
Inventories by segment | March 31, December 31, (US$ in millions) 2016 2015 Agribusiness (1) $ $ Edible Oil Products (2) Milling Products Sugar and Bioenergy (3) Fertilizer Total $ $ (1) Includes RMI of $3,769 million and $3,393 million at March 31, 2016 and December 31, 2015, respectively. Of these amounts $2,877 million and $2,513 million can be attributable to merchandising activities at March 31, 2016 and December 31, 2015, respectively. (2) Includes RMI of bulk soybean and canola oil in the aggregate amount of $108 million and $110 million at March 31, 2016 and December 31, 2015, respectively. (3) Includes sugar RMI, which can be attributable to Bunge’s trading and merchandising business of $80 million and $163 million at March 31, 2016 and December 31, 2015, respectively. |
OTHER CURRENT ASSETS (TABLES)
OTHER CURRENT ASSETS (TABLES) | 3 Months Ended |
Mar. 31, 2016 | |
OTHER CURRENT ASSETS | |
Other current assets | March 31, December 31, (US$ in millions) 2016 2015 Prepaid commodity purchase contracts (1) $ $ Secured advances to suppliers, net (2) Unrealized gains on derivative contracts, at fair value Recoverable taxes, net Margin deposits Marketable securities, at fair value and other short-term investments Deferred purchase price receivable, at fair value (3) Prepaid expenses Other Total $ $ (1) Prepaid commodity purchase contracts represent advance payments against fixed price contracts for future delivery of specified quantities of agricultural commodities. (2) Bunge provides cash advances to suppliers, primarily Brazilian farmers of soybeans and sugarcane, to finance a portion of the suppliers’ production costs. Bunge does not bear any of the costs or risks associated with the related growing crops. The advances are largely collateralized by future crops and physical assets of the suppliers, carry a local market interest rate and settle when the farmer’s crop is harvested and sold. The secured advances to farmers are reported net of allowances of $2 million at March 31, 2016 and December 31, 2015. Interest earned on secured advances to suppliers of $11 million for each of the three months ended March 31, 2016 and 2015 is included in net sales in the condensed consolidated statements of income. (3) Deferred purchase price receivable represents additional credit support for the investment conduits in Bunge’s accounts receivables sales program (see Note 12). |
Summary of marketable securities and short-term investments | March 31, December 31, (US$ in millions) 2016 2015 Foreign government securities $ $ Corporate debt securities Certificate of deposits/time deposits Other — Total marketable securities and other short-term investments $ $ |
OTHER NON-CURRENT ASSETS (TABLE
OTHER NON-CURRENT ASSETS (TABLES) | 3 Months Ended |
Mar. 31, 2016 | |
OTHER NON-CURRENT ASSETS | |
Schedule of other non-current assets | March 31, December 31, (US$ in millions) 2016 2015 Recoverable taxes, net (1) $ $ Judicial deposits (1) Other long-term receivables Income taxes receivable (1) Long-term investments Affiliate loans receivable, net Long-term receivables from farmers in Brazil, net (1) Other Total $ $ (1) These non-current assets arise primarily from Bunge’s Brazilian operations and their realization could take in excess of five years. |
Long-term receivables from Brazilian farmers | March 31, December 31, (US$ in millions) 2016 2015 Legal collection process (1) $ $ Renegotiated amounts (2) Other long-term receivables Total $ $ (1) All amounts in legal process are considered past due upon initiation of legal action. (2) All renegotiated amounts are current on repayment terms. |
Summary of recorded investment in long-term receivables and the related allowance amounts from Brazilian farmers | March 31, 2016 December 31, 2015 Recorded Recorded (US$ in millions) Investment Allowance Investment Allowance For which an allowance has been provided: Legal collection process $ $ $ $ Renegotiated amounts For which no allowance has been provided: Legal collection process — — Renegotiated amounts — — Other long-term receivables — — Total $ $ $ $ |
Summary of the activity in the allowance for doubtful accounts related to long-term receivables from Brazilian farmers | Three Months Ended March 31, (US$ in millions) 2016 2015 Beginning balance $ $ Bad debt provisions — Recoveries — ) Transfers (1) — Foreign exchange translation ) Ending balance $ $ (1) Represents reclassifications from allowance for doubtful accounts-current for secured advances to suppliers. |
OTHER CURRENT LIABILITIES (TABL
OTHER CURRENT LIABILITIES (TABLES) | 3 Months Ended |
Mar. 31, 2016 | |
OTHER CURRENT LIABILITIES | |
Other current liabilities | March 31, December 31, (US$ in millions) 2016 2015 Accrued liabilities $ $ Unrealized losses on derivative contracts at fair value Advances on sales Other Total $ $ |
FINANCIAL INSTRUMENTS AND FAI33
FINANCIAL INSTRUMENTS AND FAIR VALUE MEASUREMENTS (TABLES) | 3 Months Ended |
Mar. 31, 2016 | |
Derivative Instruments | |
Schedule of assets and liabilities accounted for at fair value on a recurring basis | Fair Value Measurements at Reporting Date March 31, 2016 December 31, 2015 (US$ in millions) Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Total Assets: Readily marketable inventories (Note 5) $ — $ $ $ $ — $ $ $ Trade accounts receivable (1) — — Unrealized gain on designated derivative contracts (2) : Interest rate — — — — — — Foreign exchange — — — Unrealized gain on undesignated derivative contracts (2) : Foreign exchange — — Commodities Freight — — — Energy — — — Deferred purchase price receivable (Note 12) — — — — Other (3) — — Total assets $ $ $ $ $ $ $ $ Liabilities: Trade accounts payable (1) $ — $ $ $ $ — $ $ $ Unrealized loss on designated derivative contracts (4) : Interest rate — — — — — — Foreign exchange — — — — Unrealized loss on undesignated derivative contracts (4) : Interest rate — — — — — — Foreign exchange — — — Commodities Freight — — — Energy — Total liabilities $ $ $ $ $ $ $ $ (1) Trade accounts receivable and payable are generally stated at historical amounts, net of write-offs and allowances, with the exception of $10 million and $639 million, at March 31, 2016 and $6 million and $443 million at December 31, 2015, respectively, related to certain delivered inventory for which the receivable and payable, respectively, fluctuate based on changes in commodity prices. These receivables and payables are hybrid financial instruments for which Bunge has elected the fair value option. (2) Unrealized gains on designated and undesignated derivative contracts are generally included in other current assets. There are no such amounts included in other non-current assets at March 31, 2016 and December 31, 2015, respectively. (3) Other includes the fair values of marketable securities and investments in other current assets and other non-current assets. (4) Unrealized losses on designated and undesignated derivative contracts are generally included in other current liabilities. There are no such amounts included in other non-current liabilities at March 31, 2016 and December 31, 2015, respectively. |
Reconciliation of assets and liabilities measured at fair value on a recurring basis using significant unobservable inputs (Level 3) | Level 3 Instruments Fair Value Measurements Three Months Ended March 31, 2016 Readily Trade Accounts Derivatives, Marketable Receivable/ (US$ in millions) Net (1) Inventories Payable, Net (2) Total Balance, January 1, 2016 $ $ $ ) $ Total gains and (losses), realized/unrealized included in cost of goods sold ) ) Purchases — ) Sales — ) — ) Issuances — — — Settlements ) — — ) Transfers into Level 3 ) Transfers out of Level 3 ) ) Balance, March 31, 2016 $ $ $ ) $ (1) Derivatives, net include Level 3 derivative assets and liabilities. (2) Trade Accounts Receivable and Trade Accounts Payable, net, include Level 3 inventory related receivables and payables. Level 3 Instruments Fair Value Measurements Three Months Ended March 31, 2015 Readily Trade Accounts Derivatives, Marketable Receivable/ (US$ in millions) Net (1) Inventories Payable, Net (2) Total Balance, January 1, 2015 $ ) $ $ ) $ Total gains and (losses), realized/unrealized included in cost of goods sold — Purchases — ) Sales — ) — ) Issuances — — ) ) Settlements ) — — ) Transfers into Level 3 ) Transfers out of Level 3 ) ) Balance, March 31, 2015 $ $ $ ) $ (1) Derivatives, net include Level 3 derivative assets and liabilities. (2) Trade Accounts Receivable and Trade Accounts Payable, net, include Level 3 inventory related receivables and payables. |
Summary of changes in unrealized gains or (losses) recorded in earnings for Level 3 assets and liabilities | Level 3 Instruments Fair Value Measurements Three Months Ended Readily Trade Accounts Derivatives, Marketable Receivable and (US$ in millions) Net (1) Inventories Payable, Net (2) Total Changes in unrealized gains and (losses) relating to assets and liabilities held at March 31, 2016 Cost of goods sold $ ) $ ) $ $ ) Changes in unrealized gains and (losses) relating to assets and liabilities held at March 31, 2015 Cost of goods sold $ $ ) $ — $ (1) Derivatives, net include Level 3 derivative assets and liabilities. (2) Trade Accounts Receivable and Trade Accounts Payable, net, include Level 3 inventory related receivables and payables. |
Summary of effect of derivative instruments designated as fair value hedges and undesignated derivative instruments on condensed consolidated statements of income | Gain or (Loss) Recognized in Income on Derivative Instruments Three Months Ended March 31, (US$ in millions) Location 2016 2015 Undesignated Derivative Contracts: Foreign Exchange Foreign exchange gains (losses) $ $ ) Foreign Exchange Cost of goods sold ) Commodities Cost of goods sold ) Freight Cost of goods sold ) Energy Cost of goods sold ) ) Total $ $ ) |
Summary of effect of derivative instruments designated as cash flow and net investment hedges | Three Months Ended March 31, 2016 Gain or Gain or (Loss) (Loss) Reclassified from Recognized in Accumulated OCI into Gain or (Loss) Recognized Notional Accumulated Income (1) in Income on Derivatives (US$ in millions) Amount OCI (1) Location Amount Location Amount (2) Cash Flow Hedge: Foreign Exchange (3) $ $ Foreign exchange gains (losses) $ ) Foreign exchange gains (losses) $ — Total $ $ $ ) $ — Net Investment Hedge: Foreign Exchange (3) $ $ ) Foreign exchange gains (losses) $ — Foreign exchange gains (losses) $ — Total $ $ ) $ — $ — (1) The gain (loss) recognized relates to the effective portion of the hedging relationship. At March 31, 2016, Bunge expects to reclassify into income in the next 12 months approximately $ 16 million of after-tax gain (loss) related to its foreign exchange cash flow hedges and zero for net investment hedges. (2) There was no gain or loss recognized in income relating to the ineffective portion of the hedging relationships or relating to amounts excluded from the assessment of hedge effectiveness. (3) The foreign exchange contracts mature at various dates through November 2020. Three Months Ended March 31, 2015 Gain or Gain or (Loss) (Loss) Reclassified from Recognized in Accumulated OCI into Gain or (Loss) Recognized Notional Accumulated Income (1) in Income on Derivatives (US$ in millions) Amount OCI (1) Location Amount Location Amount (2) Cash Flow Hedge: Foreign Exchange (3) $ $ ) Foreign exchange gains (losses) $ ) Foreign exchange gains (losses) $ — Total $ $ ) $ ) $ — Net Investment Hedge: Foreign Exchange (3) $ $ Foreign exchange gains (losses) $ — Foreign exchange gains (losses) $ — Total $ $ $ — $ — (1) The gain or (loss) recognized relates to the effective portion of the hedging relationship. At March 31, 2015, Bunge expected to reclassify into income in the next 12 months approximately $(53) million of after-tax gains (losses) related to its foreign exchange cash flow hedges. (2) There was no gain or loss recognized in income relating to the ineffective portion of the hedging relationships or to amounts excluded from the assessment of hedge effectiveness. (3) The foreign exchange contracts matured at various dates in 2015 and 2016. |
Interest rate. | |
Derivative Instruments | |
Summary of outstanding derivative instruments | March 31, 2016 Notional Amount of Notional Amount (US$ in millions) Hedged Obligation Derivative (3) Interest rate swap agreements $ $ Weighted average rate payable - 3 month LIBOR plus 1.91% (1) Weighted average rate receivable - 3.5% (2) (1) Interest is payable in arrears semi-annually based on three-month U.S. dollar LIBOR plus 1.91%. (2) Interest is receivable in arrears based on a fixed interest rate of 3.5%. (3) The interest rate swap agreements mature in 2020. |
Foreign Exchange | |
Derivative Instruments | |
Summary of outstanding derivative instruments | March 31, 2016 Exchange Traded Net (Short) Non-exchange Traded Unit of (US$ in millions) & Long (1) (Short) (2) Long (2) Measure Foreign Exchange Options $ — $ ) $ Delta Forwards — ) Notional Futures — — Notional Swaps — ) Notional (1) Exchange traded derivatives are presented on a net (short) and long position basis. (2) Non-exchange traded derivatives are presented on a gross (short) and long position basis. |
Commodities | |
Derivative Instruments | |
Summary of outstanding derivative instruments | March 31, 2016 Exchange Traded Net (Short) & Non-exchange Traded Unit of Long (1) (Short) (2) Long (2) Measure Agricultural Commodities Futures ) — — Metric Tons Options ) ) — Metric Tons Forwards — ) Metric Tons Swaps — ) Metric Tons (1) Exchange traded derivatives are presented on a net (short) and long position basis. (2) Non-exchange traded derivatives are presented on a gross (short) and long position basis. |
Freight | |
Derivative Instruments | |
Summary of outstanding derivative instruments | March 31, 2016 Exchange Cleared Net (Short) & Non-exchange Cleared Unit of Long (1) (Short) (2) Long (2) Measure Ocean Freight FFA — — Hire Days FFA Options ) — — Hire Days (1) Exchange cleared derivatives are presented on a net (short) and long position basis. (2) Non-exchange cleared derivatives are presented on a gross (short) and long position basis. |
Energy | |
Derivative Instruments | |
Summary of outstanding derivative instruments | March 31, 2016 Exchange Traded Net (Short) & Non-exchange Cleared Unit of Long (1) (Short) (2) Long (2) Measure (3) Natural Gas (3) Futures — — MMBtus Swaps — — MMBtus Options — — — MMBtus Energy—Other Futures ) — — Metric Tons Forwards — — Metric Tons Swaps — — Metric Tons Options — — — Metric Tons (1) Exchange traded and cleared derivatives are presented on a net (short) and long position basis. (2) Non-exchange cleared derivatives are presented on a gross (short) and long position basis. (3) Million British Thermal Units (MMBtus) is the standard unit of measurement used to denote an amount of natural gas. |
DEBT (TABLES)
DEBT (TABLES) | 3 Months Ended |
Mar. 31, 2016 | |
DEBT | |
Schedule of carrying amounts and fair values of long-term debt | March 31, 2016 December 31, 2015 Carrying Fair Value Fair Value Carrying Fair Value Fair Value (US$ in millions) Value (Level 2) (Level 3) Value (Level 2) (Level 3) Long-term debt, including current portion $ $ $ — $ $ $ |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (TABLES) | 3 Months Ended |
Mar. 31, 2016 | |
COMMITMENTS AND CONTINGENCIES | |
Liabilities related to general claims and lawsuits included in other non-current liabilities | March 31, December 31, (US$ in millions) 2016 2015 Tax claims $ $ Labor claims Civil and other claims Total $ $ |
Maximum potential future payments related to guarantees | Bunge has issued or was a party to the following guarantees at March 31, 2016: Maximum Potential Future (US$ in millions) Payments Unconsolidated affiliates financing (1) $ Residual value guarantee (2) Total $ (1) Bunge issued guarantees to certain financial institutions related to debt of certain of its unconsolidated joint ventures. The terms of the guarantees are equal to the terms of the related financings which have maturity dates in 2016 through 2018. There are no recourse provisions or collateral that would enable Bunge to recover any amounts paid under these guarantees. At March 31, 2016, Bunge’s recorded obligation related to these guarantees was $4 million. (2) Bunge issued guarantees to certain financial institutions which are party to certain operating lease arrangements for railcars and barges. These guarantees provide for a minimum residual value to be received by the lessor at conclusion of the lease term. These leases expire at various dates from 2016 through 2020. At March 31, 2016, Bunge’s recorded obligation related to these guarantees was $5 million. |
EQUITY (TABLES)
EQUITY (TABLES) | 3 Months Ended |
Mar. 31, 2016 | |
EQUITY | |
Schedule of after-tax components of accumulated other comprehensive income (loss) attributable to Bunge | Deferred Pension and Other Unrealized Accumulated Foreign Exchange Gains (Losses) Postretirement Gains (Losses) Other Translation on Hedging Liability on Comprehensive (US$ in millions) Adjustment Activities Adjustments Investments Income (Loss) Balance January 1, 2016 $ ) $ $ ) $ $ ) Other comprehensive income (loss) before reclassifications ) — — Amount reclassified from accumulated other comprehensive income — — — Balance, March 31, 2016 $ ) $ $ ) $ $ ) Deferred Pension and Other Unrealized Accumulated Foreign Exchange Gains (Losses) Postretirement Gains (Losses) Other Translation on Hedging Liability on Comprehensive (US$ in millions) Adjustment Activities Adjustments Investments Income (Loss) Balance January 1, 2015 $ ) $ ) $ ) $ $ ) Other comprehensive income (loss) before reclassifications ) — ) Amount reclassified from accumulated other comprehensive income — — — Balance, March 31, 2015 $ ) $ $ ) $ $ ) |
EARNINGS PER COMMON SHARE (TABL
EARNINGS PER COMMON SHARE (TABLES) | 3 Months Ended |
Mar. 31, 2016 | |
EARNINGS PER COMMON SHARE | |
Computation of basic and diluted earnings per common share | Convertible preference share dividends ) ) Income (loss) from discontinued operations, net of tax ) Net income (loss) available to Bunge common shareholders $ $ Weighted-average number of common shares outstanding: Basic Effect of dilutive shares: —stock options and awards (2) —convertible preference shares Diluted Basic earnings per common share: Net income (loss) from continuing operations $ $ Net income (loss) from discontinued operations ) Net income (loss) attributable to Bunge common shareholders—basic $ $ Diluted earnings per common share: Net income (loss) from continuing operations $ $ Net income (loss) from discontinued operations ) Net income (loss) attributable to Bunge common shareholders—diluted $ $ (1) Accretion of redeemable noncontrolling interest of $5 million and $6 million for the three months ended March 31, 2016 and 2015, respectively, relates to a non-fair value variable put arrangement whereby the noncontrolling interest holder may require Bunge to purchase the remaining shares of an oilseed processing operation in Central and Eastern Europe. Accretion for the respective periods includes the effect of losses incurred by the operations for the three months ended March 31, 2016, and 2015, respectively. (2) Approximately 7 million outstanding stock options and contingently issuable restricted stock units were not dilutive and not included in the weighted-average number of common shares outstanding for the three months ended March 31, 2016. Approximately 2 million outstanding stock options and contingently issuable restricted stock units were not dilutive and not included in the weighted-average number of common shares outstanding for the three months ended March 31, 2015 |
SEGMENT INFORMATION (TABLES)
SEGMENT INFORMATION (TABLES) | 3 Months Ended |
Mar. 31, 2016 | |
SEGMENT INFORMATION | |
Operating Segment Information | (US$ in millions) Edible Discontinued Three Months Ended Oil Milling Sugar and Operations & March 31, 2016 Agribusiness Products Products Bioenergy Fertilizer Unallocated (1) Total Net sales to external customers $ $ $ $ $ $ — $ Inter—segment revenues — — ) — Gross profit — Foreign exchange gains (losses) ) ) — ) — Noncontrolling interests ) — — — Other income (expense) — net ) ) ) — — ) Segment EBIT (2) ) — Discontinued operations (3) — — — — — ) ) Depreciation, depletion and amortization ) ) ) ) ) — ) Total assets Three Months Ended March 31, 2015 Net sales to external customers $ $ $ $ $ $ — $ Inter—segment revenues — ) — Gross profit ) — Foreign exchange gains (losses) ) ) ) — — ) Noncontrolling interests ) — — — Other income (expense) — net — ) ) — — Segment EBIT (2) ) ) — Discontinued operations (3) — — — — — Depreciation, depletion and amortization ) ) ) ) ) — ) Total assets (1) Includes noncontrolling interests share of interest and tax to reconcile to consolidated noncontrolling interest and discontinued operations of Brazilian fertilizer distribution business and certain asset management operations. (2) Total segment earnings before interest and taxes (“EBIT”) is an operating performance measure used by Bunge’s management to evaluate segment operating activities. Bunge’s management believes total segment EBIT is a useful measure of operating profitability, since the measure allows for an evaluation of the performance of its segments without regard to its financing methods or capital structure. In addition, EBIT is a financial measure that is widely used by analysts and investors in Bunge’s industries. (3) Represents net income (loss) from discontinued operations. |
Reconciliation of total segment earnings before interest and tax to net income attributable to Bunge | Three Months Ended March 31, (US$ in millions) 2016 2015 Total segment EBIT from continuing operations $ $ Interest income Interest expense ) ) Income tax (expense) benefit ) ) Income (loss) from discontinued operations, net of tax ) Noncontrolling interests’ share of interest and tax Net income (loss) attributable to Bunge $ $ |
ACCOUNTING PRONOUNCEMENTS (DETA
ACCOUNTING PRONOUNCEMENTS (DETAILS) - Accounting Standards Update 2015-02 $ in Millions | Jan. 31, 2016USD ($) |
ASU 2015-02 Adoption | |
Difference between the net amounts subtracted from the financial statements and the retained interest in deconsolidated subsidiaries | $ 0 |
Retained Earnings | |
ASU 2015-02 Adoption | |
Cumulative effect adjustments | $ 0 |
BUSINESS ACQUISITIONS (DETAILS)
BUSINESS ACQUISITIONS (DETAILS) $ in Millions | Mar. 30, 2016USD ($) | Jan. 29, 2016USD ($)itemshares | Feb. 01, 2016 | Jan. 31, 2016 |
SALIC | ||||
Business Acquisitions | ||||
Number of promissory note converted | item | 2 | |||
SALIC | G3 | ||||
Business Acquisitions | ||||
Ownership interest (as a percent) | 75.00% | 65.00% | 49.00% | |
G3 | ||||
Business Acquisitions | ||||
Promissory note amount converted | $ 106 | |||
Number of shares issued for conversion of promissory note | shares | 148,323,000 | |||
Bunge Canada | G3 | ||||
Business Acquisitions | ||||
Ownership interest (as a percent) | 25.00% | 35.00% | 51.00% | |
Ownership interest sold (as a percent) | 10.00% | |||
Cash proceeds from sale of ownership interest | $ 37 |
TRADE STRUCTURED FINANCE PROG41
TRADE STRUCTURED FINANCE PROGRAM (DETAILS) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2016 | Mar. 31, 2015 | Dec. 31, 2015 | |
Trade structured finance program | |||
Weighted-average interest rate of time deposits (as a percent) | 2.29% | 2.21% | |
Total net proceeds from issuances of LCs | $ 1,396 | $ 1,922 | |
Assets: | |||
Carrying value of time deposits | 242 | $ 325 | |
Liabilities : | |||
Carrying value of letters of credit obligations and foreign exchange contracts | 242 | 325 | |
Total fair value (Level 2 measurement) of letters of credit obligations and foreign exchange contracts | 242 | 325 | |
Time deposits, LCs, foreign exchange contracts presented net in the balance sheet | |||
Trade structured finance program | |||
Face value of time deposits, LCs, and foreign exchange contracts | 3,580 | 3,394 | |
Level 2 | |||
Assets: | |||
Fair value (Level 2 measurement) of time deposits | 242 | 325 | |
Liabilities : | |||
Fair value (Level 2 measurement) of letters of credit obligations | 242 | 323 | |
Fair value (Level 2 measurement) of foreign exchange forward contracts-(gains) losses | 2 | ||
Total fair value (Level 2 measurement) of letters of credit obligations and foreign exchange contracts | $ 242 | $ 325 |
INVENTORIES (DETAILS)
INVENTORIES (DETAILS) - USD ($) $ in Millions | Mar. 31, 2016 | Dec. 31, 2015 |
INVENTORIES | ||
Inventories | $ 4,807 | $ 4,466 |
Agribusiness | ||
INVENTORIES | ||
Inventories | 3,914 | 3,533 |
Readily marketable inventories at fair value | 3,769 | 3,393 |
Agribusiness | Merchandising Activities | ||
INVENTORIES | ||
Readily marketable inventories at fair value | 2,877 | 2,513 |
Edible Oil Products | ||
INVENTORIES | ||
Inventories | 347 | 356 |
Readily marketable inventories at fair value | 108 | 110 |
Milling Products | ||
INVENTORIES | ||
Inventories | 177 | 164 |
Sugar and Bioenergy | ||
INVENTORIES | ||
Inventories | 305 | 350 |
Readily marketable inventories at fair value | 80 | 163 |
Fertilizer | ||
INVENTORIES | ||
Inventories | $ 64 | $ 63 |
OTHER CURRENT ASSETS (DETAILS)
OTHER CURRENT ASSETS (DETAILS) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2016 | Mar. 31, 2015 | Dec. 31, 2015 | |
Other Current Assets: | |||
Prepaid commodity purchase contracts | $ 236 | $ 287 | |
Secured advances to suppliers, net | 552 | 521 | |
Unrealized gains on derivative contracts, at fair value | 1,473 | 1,456 | |
Recoverable taxes, net | 289 | 364 | |
Margin deposits | 368 | 467 | |
Marketable securities, at fair value and other short-term investments | 344 | 234 | |
Deferred purchase price receivable, at fair value | 80 | 79 | |
Prepaid expenses | 149 | 132 | |
Other | 290 | 359 | |
Total | 3,781 | 3,899 | |
Allowance on secured advance to farmers | 2 | $ 2 | |
Interest earned on secured advances to suppliers | $ 11 | $ 11 |
OTHER CURRENT ASSETS - MARKETAB
OTHER CURRENT ASSETS - MARKETABLE SECURITIES AND OTHER SHORT-TERM INVESTMENTS (DETAILS) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2016 | Mar. 31, 2015 | Dec. 31, 2015 | |
Marketable Securities and Other Short-Term Investments | |||
Marketable securities and other short-term investments | $ 344 | $ 234 | |
Held-to-maturity | 159 | 76 | |
Trading | $ 185 | 158 | |
Maximum maturity period | 12 months | ||
Trading securities net gain | $ 8 | $ 7 | |
Foreign government securities | |||
Marketable Securities and Other Short-Term Investments | |||
Marketable securities and other short-term investments | 85 | 61 | |
Corporate debt securities | |||
Marketable Securities and Other Short-Term Investments | |||
Marketable securities and other short-term investments | 112 | 92 | |
Certificate of deposits/time deposits | |||
Marketable Securities and Other Short-Term Investments | |||
Marketable securities and other short-term investments | $ 147 | 55 | |
Other | |||
Marketable Securities and Other Short-Term Investments | |||
Marketable securities and other short-term investments | $ 26 |
OTHER NON-CURRENT ASSETS - COMP
OTHER NON-CURRENT ASSETS - COMPOSITION (DETAILS) - USD ($) $ in Millions | Mar. 31, 2016 | Dec. 31, 2015 |
OTHER NON-CURRENT ASSETS | ||
Recoverable taxes, net | $ 214 | $ 133 |
Judicial deposits | 131 | 119 |
Other long-term receivables | 28 | 23 |
Income taxes receivable | 279 | 195 |
Long-term investments | 53 | 49 |
Affiliate loans receivable, net | 21 | 15 |
Long-term receivables from farmers in Brazil, net | 128 | 117 |
Other | 123 | 121 |
Total | 977 | 772 |
Allowance for recoverable taxes | $ 22 | $ 20 |
OTHER NON-CURRENT ASSETS - RECE
OTHER NON-CURRENT ASSETS - RECEIVABLES FROM FARMERS IN BRAZIL (DETAILS) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | ||
Mar. 31, 2016 | Dec. 31, 2015 | Mar. 31, 2015 | Dec. 31, 2014 | |
Affiliate loans receivable, net | ||||
Minimum initial maturity of affiliate loans receivable | 1 year | |||
Minimum | ||||
Aging of non-defaulted and renegotiated amounts | ||||
Period of realization | 5 years | |||
Other long-term receivables | ||||
Recorded Investment | ||||
Long-term receivables from farmers in Brazil | $ 41 | $ 40 | ||
Long-term receivables | ||||
Recorded Investment | ||||
Long-term receivables from farmers in Brazil | 236 | 217 | ||
Average recorded investment in long-term receivables | 221 | 214 | ||
Allowance | 108 | 100 | $ 130 | $ 153 |
Long-term receivables | Legal collection processes | ||||
Recorded Investment | ||||
Long-term receivables from farmers in Brazil | 136 | 119 | ||
For which an allowance has been provided: | 85 | 78 | ||
For which no allowance has been provided: | 51 | 41 | ||
Allowance | 75 | 69 | ||
Long-term receivables | Renegotiated amounts | ||||
Recorded Investment | ||||
Long-term receivables from farmers in Brazil | 59 | 58 | ||
For which an allowance has been provided: | 39 | 37 | ||
For which no allowance has been provided: | 20 | 21 | ||
Allowance | 33 | 31 | ||
Long-term receivables | Other long-term receivables | ||||
Recorded Investment | ||||
For which no allowance has been provided: | $ 41 | $ 40 |
OTHER NON-CURRENT ASSETS - ALLO
OTHER NON-CURRENT ASSETS - ALLOWANCE FOR DOUBTFUL ACCOUNTS (DETAILS) - Long-term receivables - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Allowance for Doubtful Accounts Related to Long Term Receivables | ||
Beginning balance | $ 100 | $ 153 |
Bad debt provisions | 1 | |
Recoveries | (2) | |
Transfers | 4 | |
Foreign exchange translation | 8 | (26) |
Ending balance | $ 108 | $ 130 |
INCOME TAXES (DETAILS)
INCOME TAXES (DETAILS) $ in Millions | 3 Months Ended | |
Mar. 31, 2016USD ($)item | Mar. 31, 2015USD ($) | |
Income Tax Examination | ||
Income tax expense | $ 34 | $ 85 |
Discrete tax benefits | 60 | |
Income tax charge for uncertain tax position | $ 32 | |
Number of discrete items | item | 2 | |
Effective tax rates excluding discrete items | 27.00% | |
Continued Operations | ||
Income Tax Examination | ||
Income tax expense | $ 34 | $ 85 |
Effective tax rate (as a percent) | 12.00% | 26.00% |
OTHER CURRENT LIABILITIES (DETA
OTHER CURRENT LIABILITIES (DETAILS) - USD ($) $ in Millions | Mar. 31, 2016 | Dec. 31, 2015 |
OTHER CURRENT LIABILITIES | ||
Accrued liabilities | $ 638 | $ 688 |
Unrealized losses on derivative contracts at fair value | 1,221 | 1,471 |
Advances on sales | 315 | 371 |
Other | 277 | 233 |
Total | $ 2,451 | $ 2,763 |
FINANCIAL INSTRUMENTS AND FAI50
FINANCIAL INSTRUMENTS AND FAIR VALUE MEASUREMENTS - ASSETS AND LIABILITIES AT FAIR VALUE (DETAILS) - USD ($) $ in Millions | Mar. 31, 2016 | Dec. 31, 2015 |
Assets: | ||
Unrealized gain | $ 1,473 | $ 1,456 |
Deferred purchase price receivable | 80 | 79 |
Liabilities: | ||
Unrealized loss | 1,221 | 1,471 |
Other non-current assets. | ||
Unrealized gains (losses) on designated and undesignated derivative contracts | ||
Unrealized gains (losses) on derivative contracts | 0 | 0 |
Other non-current liabilities | ||
Unrealized gains (losses) on designated and undesignated derivative contracts | ||
Unrealized gains (losses) on derivative contracts | 0 | 0 |
Assets and liabilities measured at fair value on a recurring basis | Level 1 | ||
Assets: | ||
Other | 42 | 68 |
Total assets | 357 | 401 |
Liabilities: | ||
Total liabilities | 378 | 490 |
Assets and liabilities measured at fair value on a recurring basis | Level 1 | Designated derivative contracts | Foreign Exchange | ||
Assets: | ||
Unrealized gain | 1 | |
Assets and liabilities measured at fair value on a recurring basis | Level 1 | Undesignated derivative contracts | Foreign Exchange | ||
Assets: | ||
Unrealized gain | 10 | 9 |
Liabilities: | ||
Unrealized loss | 1 | |
Assets and liabilities measured at fair value on a recurring basis | Level 1 | Undesignated derivative contracts | Commodities | ||
Assets: | ||
Unrealized gain | 231 | 252 |
Liabilities: | ||
Unrealized loss | 306 | 402 |
Assets and liabilities measured at fair value on a recurring basis | Level 1 | Undesignated derivative contracts | Freight | ||
Assets: | ||
Unrealized gain | 62 | 65 |
Liabilities: | ||
Unrealized loss | 57 | 56 |
Assets and liabilities measured at fair value on a recurring basis | Level 1 | Undesignated derivative contracts | Energy | ||
Assets: | ||
Unrealized gain | 11 | 7 |
Liabilities: | ||
Unrealized loss | 15 | 31 |
Assets and liabilities measured at fair value on a recurring basis | Level 2 | ||
Assets: | ||
Readily marketable inventories | 3,227 | 3,421 |
Trade accounts receivable | 10 | 6 |
Deferred purchase price receivable | 80 | 79 |
Other | 371 | 176 |
Total assets | 4,757 | 4,584 |
Liabilities: | ||
Trade accounts payable | 348 | 399 |
Total liabilities | 1,118 | 1,326 |
Assets and liabilities measured at fair value on a recurring basis | Level 2 | Designated derivative contracts | Interest rate. | ||
Assets: | ||
Unrealized gain | 11 | |
Liabilities: | ||
Unrealized loss | 3 | |
Assets and liabilities measured at fair value on a recurring basis | Level 2 | Designated derivative contracts | Foreign Exchange | ||
Assets: | ||
Unrealized gain | 16 | 30 |
Liabilities: | ||
Unrealized loss | 184 | 15 |
Assets and liabilities measured at fair value on a recurring basis | Level 2 | Undesignated derivative contracts | Interest rate. | ||
Liabilities: | ||
Unrealized loss | 1 | |
Assets and liabilities measured at fair value on a recurring basis | Level 2 | Undesignated derivative contracts | Foreign Exchange | ||
Assets: | ||
Unrealized gain | 441 | 176 |
Liabilities: | ||
Unrealized loss | 201 | 605 |
Assets and liabilities measured at fair value on a recurring basis | Level 2 | Undesignated derivative contracts | Commodities | ||
Assets: | ||
Unrealized gain | 601 | 696 |
Liabilities: | ||
Unrealized loss | 381 | 304 |
Assets and liabilities measured at fair value on a recurring basis | Level 2 | Undesignated derivative contracts | Energy | ||
Liabilities: | ||
Unrealized loss | 3 | |
Assets and liabilities measured at fair value on a recurring basis | Level 3 | ||
Assets: | ||
Readily marketable inventories | 730 | 245 |
Total assets | 819 | 466 |
Liabilities: | ||
Trade accounts payable | 291 | 44 |
Total liabilities | 364 | 98 |
Assets and liabilities measured at fair value on a recurring basis | Level 3 | Undesignated derivative contracts | Commodities | ||
Assets: | ||
Unrealized gain | 89 | 220 |
Liabilities: | ||
Unrealized loss | 70 | 52 |
Assets and liabilities measured at fair value on a recurring basis | Level 3 | Undesignated derivative contracts | Freight | ||
Liabilities: | ||
Unrealized loss | 1 | |
Assets and liabilities measured at fair value on a recurring basis | Level 3 | Undesignated derivative contracts | Energy | ||
Assets: | ||
Unrealized gain | 1 | |
Liabilities: | ||
Unrealized loss | 2 | 2 |
Fair value | Assets and liabilities measured at fair value on a recurring basis | ||
Assets: | ||
Readily marketable inventories | 3,957 | 3,666 |
Trade accounts receivable | 10 | 6 |
Deferred purchase price receivable | 80 | 79 |
Other | 413 | 244 |
Total assets | 5,933 | 5,451 |
Liabilities: | ||
Trade accounts payable | 639 | 443 |
Total liabilities | 1,860 | 1,914 |
Trade accounts receivable related to certain delivered inventory accounted for at prices that fluctuate based on changes in commodity prices and for which no payments had been received | 10 | 6 |
Trade accounts payable related to certain delivered inventory accounted for at prices that fluctuate based on changes in commodity prices and for which no payments had been made | 639 | 443 |
Fair value | Assets and liabilities measured at fair value on a recurring basis | Designated derivative contracts | Interest rate. | ||
Assets: | ||
Unrealized gain | 11 | |
Liabilities: | ||
Unrealized loss | 3 | |
Fair value | Assets and liabilities measured at fair value on a recurring basis | Designated derivative contracts | Foreign Exchange | ||
Assets: | ||
Unrealized gain | 17 | 30 |
Liabilities: | ||
Unrealized loss | 184 | 15 |
Fair value | Assets and liabilities measured at fair value on a recurring basis | Undesignated derivative contracts | Interest rate. | ||
Liabilities: | ||
Unrealized loss | 1 | |
Fair value | Assets and liabilities measured at fair value on a recurring basis | Undesignated derivative contracts | Foreign Exchange | ||
Assets: | ||
Unrealized gain | 451 | 185 |
Liabilities: | ||
Unrealized loss | 201 | 606 |
Fair value | Assets and liabilities measured at fair value on a recurring basis | Undesignated derivative contracts | Commodities | ||
Assets: | ||
Unrealized gain | 921 | 1,168 |
Liabilities: | ||
Unrealized loss | 757 | 758 |
Fair value | Assets and liabilities measured at fair value on a recurring basis | Undesignated derivative contracts | Freight | ||
Assets: | ||
Unrealized gain | 62 | 65 |
Liabilities: | ||
Unrealized loss | 58 | 56 |
Fair value | Assets and liabilities measured at fair value on a recurring basis | Undesignated derivative contracts | Energy | ||
Assets: | ||
Unrealized gain | 11 | 8 |
Liabilities: | ||
Unrealized loss | $ 20 | $ 33 |
FINANCIAL INSTRUMENTS AND FAI51
FINANCIAL INSTRUMENTS AND FAIR VALUE MEASUREMENTS - RECONCILIATION FOR ASSETS AND LIABILITIES MEASURE AT FAIR VALUE USING LEVEL 3 (DETAILS) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Reconciliation of Assets and Liabilities Measured at Fair Value on a Recurring Basis Using Significant Unobservable Inputs (Level 3) | ||
Balance at beginning of period | $ 368 | $ 220 |
Purchases | 342 | 481 |
Sales | (248) | (310) |
Issuances | (285) | |
Settlements | (66) | (18) |
Transfers into Level 3 | 135 | 146 |
Transfers out of Level 3 | (7) | (81) |
Balance at end of period | 455 | 265 |
Cost of goods sold. | ||
Reconciliation of Assets and Liabilities Measured at Fair Value on a Recurring Basis Using Significant Unobservable Inputs (Level 3) | ||
Total gains and (losses) realized/unrealized included in cost of goods sold | (69) | 112 |
Changes in unrealized gains and (losses) relating to assets and liabilities | (102) | 1 |
Derivatives, net | ||
Reconciliation of Assets and Liabilities Measured at Fair Value on a Recurring Basis Using Significant Unobservable Inputs (Level 3) | ||
Balance at beginning of period | 167 | (2) |
Settlements | (66) | (18) |
Transfers into Level 3 | 1 | |
Transfers out of Level 3 | 6 | |
Balance at end of period | 16 | 79 |
Derivatives, net | Cost of goods sold. | ||
Reconciliation of Assets and Liabilities Measured at Fair Value on a Recurring Basis Using Significant Unobservable Inputs (Level 3) | ||
Total gains and (losses) realized/unrealized included in cost of goods sold | (85) | 92 |
Changes in unrealized gains and (losses) relating to assets and liabilities | (79) | 21 |
Readily Marketable Inventories | ||
Reconciliation of Assets and Liabilities Measured at Fair Value on a Recurring Basis Using Significant Unobservable Inputs (Level 3) | ||
Balance at beginning of period | 245 | 255 |
Purchases | 537 | 482 |
Sales | (248) | (310) |
Transfers into Level 3 | 192 | 316 |
Transfers out of Level 3 | (7) | (88) |
Balance at end of period | 730 | 675 |
Readily Marketable Inventories | Cost of goods sold. | ||
Reconciliation of Assets and Liabilities Measured at Fair Value on a Recurring Basis Using Significant Unobservable Inputs (Level 3) | ||
Total gains and (losses) realized/unrealized included in cost of goods sold | 11 | 20 |
Changes in unrealized gains and (losses) relating to assets and liabilities | (24) | (20) |
Trade Accounts Receivable/Payable, Net | ||
Reconciliation of Assets and Liabilities Measured at Fair Value on a Recurring Basis Using Significant Unobservable Inputs (Level 3) | ||
Balance at beginning of period | (44) | (33) |
Fair Value Measurement With Unobservable Inputs Reconciliation Recurring Basis Asset Liability Purchases | (195) | (1) |
Issuances | (285) | |
Transfers into Level 3 | (57) | (171) |
Transfers out of Level 3 | 1 | |
Balance at end of period | (291) | $ (489) |
Trade Accounts Receivable/Payable, Net | Cost of goods sold. | ||
Reconciliation of Assets and Liabilities Measured at Fair Value on a Recurring Basis Using Significant Unobservable Inputs (Level 3) | ||
Total gains and (losses) realized/unrealized included in cost of goods sold | 5 | |
Changes in unrealized gains and (losses) relating to assets and liabilities | $ 1 |
FINANCIAL INSTRUMENTS AND FAI52
FINANCIAL INSTRUMENTS AND FAIR VALUE MEASUREMENTS - DERIVATIVE POSITIONS (DETAILS) $ in Millions | 1 Months Ended | 3 Months Ended | 9 Months Ended | 12 Months Ended |
Feb. 29, 2016USD ($) | Mar. 31, 2016USD ($)itemMMBTUt | Sep. 30, 2015 | Dec. 31, 2015USD ($) | |
Foreign Exchange | Options | Non-exchange Traded | Short | ||||
Derivative | ||||
Delta amount of open foreign exchange positions | $ 222 | |||
Foreign Exchange | Options | Non-exchange Traded | Long | ||||
Derivative | ||||
Delta amount of open foreign exchange positions | 234 | |||
Foreign Exchange | Forwards | Non-exchange Traded | Short | ||||
Derivative | ||||
Notional amounts of derivatives | 7,791 | |||
Foreign Exchange | Forwards | Non-exchange Traded | Long | ||||
Derivative | ||||
Notional amounts of derivatives | 3,534 | |||
Foreign Exchange | Futures | Exchange Traded | Long | ||||
Derivative | ||||
Notional amounts of derivatives | 284 | |||
Foreign Exchange | Swaps | Non-exchange Traded | Short | ||||
Derivative | ||||
Notional amounts of derivatives | 697 | |||
Foreign Exchange | Swaps | Non-exchange Traded | Long | ||||
Derivative | ||||
Notional amounts of derivatives | $ 91 | |||
Commodities | ||||
Derivative | ||||
Maximum period of commodity contracts for sale of agricultural commodity | 1 year | |||
Commodities | Options | Exchange Traded | Short | ||||
Derivative | ||||
Nonmonetary notional amount of derivatives | t | 20,920 | |||
Commodities | Options | Non-exchange Traded | Short | ||||
Derivative | ||||
Nonmonetary notional amount of derivatives | t | 8,899 | |||
Commodities | Forwards | Non-exchange Traded | Short | ||||
Derivative | ||||
Nonmonetary notional amount of derivatives | t | 29,644,774 | |||
Commodities | Forwards | Non-exchange Traded | Long | ||||
Derivative | ||||
Nonmonetary notional amount of derivatives | t | 23,948,974 | |||
Commodities | Futures | Exchange Traded | Short | ||||
Derivative | ||||
Nonmonetary notional amount of derivatives | t | 818,387 | |||
Commodities | Swaps | Non-exchange Traded | Short | ||||
Derivative | ||||
Nonmonetary notional amount of derivatives | t | 5,564,218 | |||
Commodities | Swaps | Non-exchange Traded | Long | ||||
Derivative | ||||
Nonmonetary notional amount of derivatives | t | 1,755,394 | |||
Freight | Options | Exchange Cleared | Short | ||||
Derivative | ||||
Nonmonetary notional amount of derivatives | item | 282 | |||
Freight | Forwards | Exchange Cleared | Long | ||||
Derivative | ||||
Nonmonetary notional amount of derivatives | item | 3,040 | |||
Natural Gas | Futures | Exchange Traded | Long | ||||
Derivative | ||||
Derivative, Nonmonetary Notional Amount, Energy Measure | MMBTU | 11,981,693 | |||
Natural Gas | Swaps | Non Exchange Cleared | Long | ||||
Derivative | ||||
Derivative, Nonmonetary Notional Amount, Energy Measure | MMBTU | 6,874,101 | |||
Energy - other | Forwards | Non Exchange Cleared | Long | ||||
Derivative | ||||
Nonmonetary notional amount of derivatives | t | 7,108,552 | |||
Energy - other | Futures | Exchange Traded | Short | ||||
Derivative | ||||
Nonmonetary notional amount of derivatives | t | 15,012 | |||
Energy - other | Swaps | Exchange Traded | Long | ||||
Derivative | ||||
Nonmonetary notional amount of derivatives | t | 244,100 | |||
Designated derivative contracts | Freight | ||||
Derivative | ||||
Notional amounts of derivatives | $ 0 | $ 0 | ||
Undesignated derivative contracts | Interest rate | ||||
Derivative | ||||
Term of contract | 1 year | |||
Notional amounts of derivatives | $ 500 | |||
3.50% unsecured senior notes due 2020 | Interest rate | ||||
Derivative | ||||
Notional Amount of Hedged Obligation | 500 | |||
Notional Amount of Derivative | $ 500 | |||
Receive rate (as a percent) | 3.50% | |||
LIBOR | 3.50% unsecured senior notes due 2020 | Interest rate | ||||
Derivative | ||||
Debt instrument, interest rate added to variable base rate (as a percent) | 1.91% |
FINANCIAL INSTRUMENTS AND FAI53
FINANCIAL INSTRUMENTS AND FAIR VALUE MEASUREMENTS - EFFECT OF DERIVATIVE INSTRUMENTS (DETAILS) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Derivative Instruments, Gain (Loss) | ||
Gain or (Loss) Recognized in Income on Undesignated Derivative Contracts | $ 152 | $ (20) |
Summary of Cash Flow and Net Investment Hedges | ||
Gain (loss) recognized in income which relates to the ineffective portion of the hedging relationships | 0 | |
Foreign Exchange | Foreign exchange gains (losses) | ||
Derivative Instruments, Gain (Loss) | ||
Gain or (Loss) Recognized in Income on Undesignated Derivative Contracts | 147 | (262) |
Foreign Exchange | Cost of goods sold. | ||
Derivative Instruments, Gain (Loss) | ||
Gain or (Loss) Recognized in Income on Undesignated Derivative Contracts | 242 | (85) |
Commodities | Cost of goods sold. | ||
Derivative Instruments, Gain (Loss) | ||
Gain or (Loss) Recognized in Income on Undesignated Derivative Contracts | (230) | 327 |
Freight | Cost of goods sold. | ||
Derivative Instruments, Gain (Loss) | ||
Gain or (Loss) Recognized in Income on Undesignated Derivative Contracts | (6) | 1 |
Energy | Cost of goods sold. | ||
Derivative Instruments, Gain (Loss) | ||
Gain or (Loss) Recognized in Income on Undesignated Derivative Contracts | (1) | (1) |
Cash flow hedges | ||
Summary of Cash Flow and Net Investment Hedges | ||
Notional Amount | 145 | 329 |
Gain or (Loss) Recognized in Accumulated OCI | 16 | (53) |
Gain or (Loss) Reclassified from Accumulated OCI into Income | (6) | (13) |
Cash flow hedges | Foreign Exchange | ||
Summary of Cash Flow and Net Investment Hedges | ||
Notional Amount | 145 | 329 |
Gain or (Loss) Recognized in Accumulated OCI | 16 | (53) |
Gains (loss) expected to be reclassified from accumulated OCI into income in the next 12 months | 16 | (53) |
Cash flow hedges | Foreign Exchange | Foreign exchange gains (losses) | ||
Summary of Cash Flow and Net Investment Hedges | ||
Gain or (Loss) Reclassified from Accumulated OCI into Income | (6) | (13) |
Amount of gain or (loss) excluded from the assessment of hedge effectiveness | 0 | 0 |
Net investment hedges | ||
Summary of Cash Flow and Net Investment Hedges | ||
Notional Amount | 1,878 | 1,249 |
Gain or (Loss) Recognized in Accumulated OCI | (200) | 95 |
Net investment hedges | Foreign Exchange | ||
Summary of Cash Flow and Net Investment Hedges | ||
Notional Amount | 1,878 | 1,249 |
Gain or (Loss) Recognized in Accumulated OCI | $ (200) | $ 95 |
DEBT (DETAILS)
DEBT (DETAILS) - USD ($) $ in Millions | Mar. 31, 2016 | Dec. 31, 2015 |
Debt Instrument [Line Items] | ||
Debt instrument unused and available borrowing capacity amount | $ 3,313 | |
Commercial paper program | ||
Debt Instrument [Line Items] | ||
Commercial paper, borrowing outstanding | 150 | |
Liquidity facility | ||
Debt Instrument [Line Items] | ||
Credit facility, borrowings outstanding | 0 | |
Carrying Value | ||
Debt Instrument [Line Items] | ||
Long-term debt, including current portion | 4,058 | $ 3,795 |
Fair value | Level 2 | ||
Debt Instrument [Line Items] | ||
Long-term debt, including current portion | $ 4,214 | 3,879 |
Fair value | Level 3 | ||
Debt Instrument [Line Items] | ||
Long-term debt, including current portion | $ 53 |
TRADE RECEIVABLES SECURITIZAT55
TRADE RECEIVABLES SECURITIZATION PROGRAM (DETAILS) - Bunge Securitization B.V. - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2016 | Mar. 31, 2015 | Dec. 31, 2015 | |
Accounts Receivable Securitization Facilities Disclosures | |||
Maximum funding under trade receivables securitization program | $ 700 | ||
Receivables sold under securitization facility derecognized during the period | 487 | $ 524 | |
Proceeds received in cash from transfers of receivables to purchasers | 2,155 | $ 2,517 | |
Cash collections from customers on receivables previously sold | 2,227 | 2,686 | |
Sale of accounts receivable to securitization facility | 2,263 | 2,609 | |
Discount from sale of receivables | 2 | $ 2 | |
Risk of loss related to sale of receivables | $ 80 | $ 79 | |
Payment term for receivables | 30 days |
RELATED PARTY TRANSACTIONS (DET
RELATED PARTY TRANSACTIONS (DETAILS) - Unconsolidated joint ventures - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Related Party Transactions | ||
Purchases of soybeans and other commodity products and port services received from certain unconsolidated ventures | $ 252 | $ 270 |
Sale of soybeans and other commodity products and port services provided to certain unconsolidated ventures | $ 56 | $ 126 |
COMMITMENTS AND CONTINGENCIES57
COMMITMENTS AND CONTINGENCIES (DETAILS) BRL / item in Thousands, BRL in Millions, $ in Millions | 1 Months Ended | 3 Months Ended | 12 Months Ended | ||||
May. 31, 2014BRLsubsidiary | Mar. 31, 2016BRLsubsidiaryemployeeitemBRL / item | Mar. 31, 2016USD ($)subsidiaryBRL / item | Dec. 31, 2014BRL | Dec. 31, 2011USD ($) | Mar. 31, 2016USD ($)employeeitem | Dec. 31, 2015USD ($) | |
Loss Contingencies and Guarantees | |||||||
Loss contingency accrual, at carrying value | $ 345 | $ 316 | |||||
Income tax liability for ICMS incentives or benefits | BRL 468 | 132 | |||||
Maximum potential future payments related to guarantees | $ 232 | ||||||
Brazil | |||||||
Loss Contingencies and Guarantees | |||||||
Number of employees under administrative proceedings | employee | 2 | 2 | |||||
Argentina | |||||||
Loss Contingencies and Guarantees | |||||||
Payment of accrued export tax obligations | $ 112 | ||||||
Interest assessed on paid export tax obligations | $ 212 | ||||||
Tax claims | |||||||
Loss Contingencies and Guarantees | |||||||
Loss contingency accrual, at carrying value | 180 | 163 | |||||
Labor claims | |||||||
Loss Contingencies and Guarantees | |||||||
Loss contingency accrual, at carrying value | 80 | 75 | |||||
Civil and other claims | |||||||
Loss Contingencies and Guarantees | |||||||
Loss contingency accrual, at carrying value | 85 | $ 78 | |||||
ICMS tax liability | Brazil | |||||||
Loss Contingencies and Guarantees | |||||||
Income tax liability for ICMS incentives or benefits | $ 0 | ||||||
Number of assessments | item | 150 | 150 | |||||
ICMS tax liability | Brazil | Maximum | |||||||
Loss Contingencies and Guarantees | |||||||
Amount per ICMS assessment | BRL / item | 70,000 | 70,000 | |||||
ICMS tax liability | Brazil | Minimum | |||||||
Loss Contingencies and Guarantees | |||||||
Amount per ICMS assessment | BRL / item | 10 | 10 | |||||
Unconsolidated affiliates financing | |||||||
Loss Contingencies and Guarantees | |||||||
Maximum potential future payments related to guarantees | $ 78 | ||||||
Obligation related to outstanding guarantees | 4 | ||||||
Residual value guarantee | |||||||
Loss Contingencies and Guarantees | |||||||
Maximum potential future payments related to guarantees | 154 | ||||||
Obligation related to outstanding guarantees | 5 | ||||||
Guarantee of indebtedness of subsidiaries | |||||||
Loss Contingencies and Guarantees | |||||||
Long-term debt including current portion, carrying value | $ 4,615 | ||||||
Tax return examination, 2010 - 2011 | ICMS tax liability | Brazil | |||||||
Loss Contingencies and Guarantees | |||||||
Total assessment | BRL 45 | $ 13 | |||||
Number of subsidiaries under tax examination | subsidiary | 1 | ||||||
Tax return examination, 2004 -2010 | PIS COFINS Liability | Brazil | |||||||
Loss Contingencies and Guarantees | |||||||
Total assessment | BRL 500 | 140 | |||||
Tax return examination, 2004 - 2009 | PIS COFINS Liability | Brazil | |||||||
Loss Contingencies and Guarantees | |||||||
Total assessment | $ 121 | BRL 430 | |||||
100% owned subsidiaries | Bunge Limited Finance Corp. and Bunge N. A. Finance L. P. [Member] | Guarantee of indebtedness of subsidiaries | |||||||
Loss Contingencies and Guarantees | |||||||
Number of finance subsidiaries issuing senior notes | subsidiary | 2 | 2 | |||||
Percentage of ownership interest | 100.00% | 100.00% |
EQUITY - SHARE REPURCHASE PROGR
EQUITY - SHARE REPURCHASE PROGRAM (DETAILS) - USD ($) $ in Millions | 3 Months Ended | 11 Months Ended | ||
Mar. 31, 2016 | Mar. 31, 2015 | Mar. 31, 2016 | May. 31, 2015 | |
Equity Disclosures | ||||
Repurchase of common shares for the period | $ 181 | $ 200 | ||
Common Shares | ||||
Equity Disclosures | ||||
Authorized amount of issued and outstanding common shares available for repurchase | $ 975 | $ 500 | ||
Repurchase of common shares (in shares) | 2,965,349 | 2,460,600 | 4,376,559 | |
Repurchase of common shares for the period | $ 181 | $ 200 | $ 281 |
EQUITY - AOCI (DETAILS)
EQUITY - AOCI (DETAILS) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax | ||
Balance at beginning of period | $ (6,360) | |
Balance at end of period | (6,026) | |
Accumulated Other Comprehensive Income (Loss) | ||
Accumulated Other Comprehensive Income (Loss), Net of Tax | ||
Balance at beginning of period | (6,360) | $ (4,058) |
Other comprehensive income (loss) before reclassifications | 328 | (1,287) |
Amount reclassified from accumulated other comprehensive income | 6 | 13 |
Balance at end of period | (6,026) | (5,332) |
Foreign Exchange Translation Adjustment | ||
Accumulated Other Comprehensive Income (Loss), Net of Tax | ||
Balance at beginning of period | (6,443) | (3,897) |
Other comprehensive income (loss) before reclassifications | 512 | (1,332) |
Balance at end of period | (5,931) | (5,229) |
Deferred Gains (Losses) on Hedging Activities | ||
Accumulated Other Comprehensive Income (Loss), Net of Tax | ||
Balance at beginning of period | 214 | (10) |
Other comprehensive income (loss) before reclassifications | (184) | 42 |
Amount reclassified from accumulated other comprehensive income | 6 | 13 |
Balance at end of period | 36 | 45 |
Pension and Other Postretirement Liability Adjustments | ||
Accumulated Other Comprehensive Income (Loss), Net of Tax | ||
Balance at beginning of period | (134) | (154) |
Other comprehensive income (loss) before reclassifications | 3 | |
Balance at end of period | (134) | (151) |
Unrealized Gains (Losses) on Investments | ||
Accumulated Other Comprehensive Income (Loss), Net of Tax | ||
Balance at beginning of period | 3 | 3 |
Balance at end of period | $ 3 | $ 3 |
EARNINGS PER COMMON SHARE (DETA
EARNINGS PER COMMON SHARE (DETAILS) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Computation of basic and diluted earnings per common share | ||
Income (loss) from continuing operations | $ 241 | $ 246 |
Net (income) loss attributable to noncontrolling interests | 3 | 3 |
Income (loss) from continuing operations attributable to Bunge | 244 | 249 |
Other redeemable obligations | (5) | (6) |
Convertible preference share dividends | (8) | (8) |
Income (loss) from discontinued operations, net of tax | (9) | 14 |
Net income (loss) available to Bunge common shareholders | $ 222 | $ 249 |
Weighted-average number of common shares outstanding: | ||
Basic (in shares) | 141,062,415 | 145,164,587 |
Effect of dilutive shares: | ||
-Stock options and awards (in shares) | 301,236 | 911,326 |
-Convertible preference shares | 7,849,440 | 7,741,800 |
Diluted (in shares) | 149,213,091 | 153,817,713 |
Basic earnings per common share: | ||
Net income (loss) from continuing operations (in dollars per share) | $ 1.64 | $ 1.61 |
Net income (loss) from discontinued operations (in dollars per share) | (0.07) | 0.10 |
Net income (loss) attributable to Bunge common shareholders (in dollars per share) | 1.57 | 1.71 |
Diluted earnings per common share: | ||
Net income (loss) from continuing operations (in dollars per share) | 1.60 | 1.58 |
Net income (loss) from discontinued operations (in dollars per share) | (0.06) | 0.09 |
Net income (loss) attributable to Bunge common shareholders (in dollars per share) | $ 1.54 | $ 1.67 |
Stock options and contingently issuable restricted stock units | ||
Diluted earnings per common share: | ||
Antidilutive shares excluded from computation of EPS | 7,000,000 | 2,000,000 |
Oilseed processing operation in Eastern Europe | ||
Diluted earnings per common share: | ||
Accretion of Redeemable Noncontrolling Interests to Redemption Value | $ 5 | $ 6 |
SEGMENT INFORMATION - FINANCIAL
SEGMENT INFORMATION - FINANCIAL INFORMATION BY SEGMENT (DETAILS) $ in Millions | 3 Months Ended | ||
Mar. 31, 2016USD ($)item | Mar. 31, 2015USD ($) | Dec. 31, 2015USD ($) | |
Segment Reporting Information | |||
Number of reportable segments | item | 5 | ||
Operating Segment Information | |||
Net sales to external customers | $ 8,916 | $ 10,806 | |
Gross profit | 620 | 710 | |
Foreign exchange gains (losses) | 21 | (7) | |
Noncontrolling interests | 3 | 3 | |
Other income (expense) - net | (5) | 1 | |
Segment EBIT | 322 | 373 | |
Discontinued operations | (9) | 14 | |
Depreciation, depletion and amortization | (113) | (120) | |
Total assets | 18,939 | 18,481 | $ 17,914 |
Agribusiness | |||
Operating Segment Information | |||
Net sales to external customers | 6,283 | 7,911 | |
Gross profit | 430 | 506 | |
Foreign exchange gains (losses) | 24 | (2) | |
Other income (expense) - net | 3 | 8 | |
Segment EBIT | 282 | 330 | |
Depreciation, depletion and amortization | (55) | (58) | |
Edible Oil Products | |||
Operating Segment Information | |||
Net sales to external customers | 1,526 | 1,648 | |
Gross profit | 112 | 114 | |
Foreign exchange gains (losses) | (1) | 5 | |
Other income (expense) - net | (1) | ||
Segment EBIT | 30 | 36 | |
Depreciation, depletion and amortization | (22) | (22) | |
Milling Products | |||
Operating Segment Information | |||
Net sales to external customers | 391 | 446 | |
Gross profit | 55 | 70 | |
Foreign exchange gains (losses) | (1) | (2) | |
Other income (expense) - net | (2) | (1) | |
Segment EBIT | 22 | 36 | |
Depreciation, depletion and amortization | (14) | (11) | |
Sugar and Bioenergy | |||
Operating Segment Information | |||
Net sales to external customers | 658 | 747 | |
Gross profit | 16 | 21 | |
Foreign exchange gains (losses) | (8) | ||
Other income (expense) - net | (5) | (6) | |
Segment EBIT | (14) | (23) | |
Depreciation, depletion and amortization | (19) | (25) | |
Fertilizer | |||
Operating Segment Information | |||
Net sales to external customers | 58 | 54 | |
Gross profit | 7 | (1) | |
Foreign exchange gains (losses) | (1) | ||
Segment EBIT | 2 | (6) | |
Depreciation, depletion and amortization | (3) | (4) | |
Operating | Agribusiness | |||
Operating Segment Information | |||
Noncontrolling interests | 2 | 2 | |
Total assets | 12,671 | 12,113 | |
Operating | Edible Oil Products | |||
Operating Segment Information | |||
Noncontrolling interests | (2) | (2) | |
Total assets | 1,998 | 2,147 | |
Operating | Milling Products | |||
Operating Segment Information | |||
Total assets | 1,444 | 1,156 | |
Operating | Sugar and Bioenergy | |||
Operating Segment Information | |||
Total assets | 2,357 | 2,524 | |
Operating | Fertilizer | |||
Operating Segment Information | |||
Total assets | 292 | 332 | |
Discontinued Operations and Unallocated | |||
Operating Segment Information | |||
Inter-segment revenues | (884) | (845) | |
Noncontrolling interests | 3 | 3 | |
Discontinued operations | (9) | 14 | |
Total assets | 177 | 209 | |
Inter-segment Eliminations | Agribusiness | |||
Operating Segment Information | |||
Inter-segment revenues | 857 | 769 | |
Inter-segment Eliminations | Edible Oil Products | |||
Operating Segment Information | |||
Inter-segment revenues | 26 | 37 | |
Inter-segment Eliminations | Milling Products | |||
Operating Segment Information | |||
Inter-segment revenues | 36 | ||
Inter-segment Eliminations | Sugar and Bioenergy | |||
Operating Segment Information | |||
Inter-segment revenues | $ 1 | $ 3 |
SEGMENT INFORMATION - SEGMENT E
SEGMENT INFORMATION - SEGMENT EBIT TO NET INCOME (DETAILS) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Reconciliation of total segment EBIT: | ||
Total segment EBIT from continuing operations | $ 322 | $ 373 |
Interest income | 10 | 11 |
Interest expense | (57) | (53) |
Income tax (expense) benefit | (34) | (85) |
Income (loss) from discontinued operations, net of tax | (9) | 14 |
Noncontrolling interests' share of interest and tax | 3 | 3 |
Net income (loss) attributable to Bunge | $ 235 | $ 263 |