BG - Earnings call transcript Q4 2020

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Operator

Good day and welcome to the Bunge Fourth Quarter 2020 Earnings Release and Conference Call. [Operator Instructions] Please note this event is being recorded. I would now like to turn the conference over to Ruth Ann Wisener. Please go ahead.

Ruth Ann Wisener

Thank you, Elisa and thank you for joining us this morning for our fourth quarter earnings call.

I to let accompany started, we know get slides have our we want you to that Before discussion. Events These Investors can Presentations. under section the and of our be website at found in bunge.com to of on posted as the Reconciliations website measures most comparable measures our GAAP directly well. are financial non-GAAP and and to statements I Bunge’s that X to current would industry future today’s that view you direct you like respect events, reflect performance financial presentation conditions. to with Slide remind includes forward-looking and risks various to subject are statements forward-looking uncertainties. These provided that results has contained concerning materially on we in file with reports factors. Bunge these and those additional its could encourage information the from review you in presentation SEC to factors this actual to cause differ

John call Neppl, turn Financial will call now to I over Chief the morning Heckman, this Bunge’s and On Officer. the Greg are Greg. Chief Officer Executive

Greg Heckman

Ann Thank good everyone. morning you, Ruth and

will handing for outlook. our highlights Slide the detail before XXXX I and to questions. before call. Turning outstanding share closing accomplishments opening your will who will on some thoughts XXXX see you with line our the will some and of into performance go I over for John, X, more to into start look then agenda today’s a

turning with to Let’s the X. of an start overview Slide year,

our most to team’s performance earnings months. adaptability, is trend it the they XX our strengthening recent incredible focus on financial to had team functioning, the We could it has specific history. during with the into and we over positive strongest we thank Thanks started performance, plan The around entire we company And the have you for organization operational process driving the and highly in Bunge XXXX portfolio begin our a embraced discussion record of a all one building the of environments our to date, transformation, be. last the did and on to this any turning performance big congratulations challenging optimizing successful team. the knew When discipline.

As the go you new through will see we the for the year, of power the results Bunge.

was made our act. improve and One visibility of speed model to transforming operating we significant the to changes

result, volumes the to helping a and record In maximize Argentina, processed in teams better coordinated, As are crush. XXXX, soy and outside our we softseed us commercial of assets. industrial

We teams financial had needed. our and soy XX% without downtime industrial how the our This of plants improved than in example additional a ensured and approach better throughout capacity arose able in customer commercial one Our year-over-year benefits our to year-over-year they at reduced on capitalize just has network And capital. were unplanned is by efficiency. use improved year. facilities significant brought softseeds. supplies as more the immediate also global of this teams the they utilization This XX% opportunities market more approximately

production the adjusted we store COVID our eating changed quickly world’s As their consumer habits, brands help lockdowns of continue leading on to shelves. the keep some to products

sustainably. worked at closely with continue adapt be vital done as to how changing they also we patterns. our work continued more We demand is to as customers Agility the also critical look our can foodservice to

industry operate. an environment leader be in to the areas where we proud We’re protecting in

wind supplier We more of we certified gas our operations, in greenhouse are soy from leading over to we’re work a Brazil. reduce And facilities as emissions to solar deforestation-free converting power. and

at packaging Texas announced run renewable a energy wind deal our For Worth, on Fort facility. and to processing use today, we in instance, corn and Kansas our plants soybean recently

identified. optimization we our all look have we significant As the originally we actions of at now announced assets, portfolio

still know with that behind COVID be us, now With shift future, us. major improvement continuous to our changes In we the immediate can focus and opportunities. will these growth we

of our and communities. families on focused protecting remain to our their continue top We priority team,

tools and sure customers. make teams and serve we COVID the regional our to needed safe to employees continue our our keep to meet to global regularly operations crisis can resources Our so have continue

Slide let’s to we’ve created unmatched team strong moving our a platform, results resilient and on X. forward. With our Now turn model for

This that benefited are throughout and to trends as the year able improving of earnings to move platform, the highlighted the they themselves year quarter in power from the the full and quickly world. presented markets capture around opportunities we really

the Edible During that upside the platform Agribusiness model, we shea. demonstrated power most fourth prices. in volatility will volatility to markets environment, from is well and a better-than-expected benefited of saw us baseline. year, we approach with both market butter the risk cocoa our demand-led above solutions communities sourced management, diesel our we shea-based of benefited source results capture on with volumes, in Karibon, be the example to business quarter, and protect XXXX consumers from our particularly the we America the elevation deliver in with the but in industry, great against for a to our demand And renewable the South customers launched that Oils, our the management risk benefit to bio-diesel fourth we captured a this driven and And substitute including always operating margins sustainably our exceptional crush allows and our where industry-leading Africa earnings ends There North Brazilian from higher continued American and the by of upside In strong quarter, U.S., that downside. in and our ingredient approach increasing higher realized innovate chain, margins. a benefits of farmers. in volatility also consumer also also oilseed operations, risk In management. of supply in and to

do This won’t of XXXX the $X in while be success share. what look to have but XXXX. expect don’t least to into visibility model our we this expect we ahead all And don’t powerful. makes adjusted into the is existed year. strength XXXX, conditions of half always EPS second that Many today, critical the XXXX and unique we will While per drive conditions helped clear in place of of we remain deliver approach our as in the it that perfectly, we manage in repeat at

impact that forecast, with and financial in a John I over watching could in results call Our to the crop will key thoughts detail additional then with to team that, And changes XXXX. will the and our be recovery. through walk will production on post-COVID we hand some closely factors including the close demand,

John Neppl

Thanks, Greg. Good morning, everyone.

Slide Let’s to on earnings turn highlights the X.

of Our XXXX. fourth reported in per loss EPS of quarter fourth share, compared a quarter the quarter $X.XX in fourth $X.XX the was $X.XX year. earnings was in Adjusted versus to prior the $X.XX

and our a the an primarily the $X.XX, claim. Our assets of of net to announced Brazilian our well as of mayonnaise tax as credit resolution favorable reported margarine included related related previously indirect impact gain tax sale results of a to

record year, share Adjusted by results versus were earnings softseed taxes, a performances Oil an higher interest per full utilization. XXXX. $X.XX excellent in in prior driven and EBIT core was in was year the For $XXX before the regions, segments. Oilseeds year, full Edible the driven strong robust driven strong processing, adjusted a quarter. primarily Adjusted by loss the our year EPS Higher and and was of or where by $X.XX capacity Agribusiness fourth segment very were in earnings in in Agribusiness oil prior demand with all veg XXXX closed out year. $X.XX of million versus $XXX versus earnings million EBIT, $X.XX quarter

our higher year. what result in business of Meat fourth export out processing which of for year accelerated our results strong lower of higher million South results to was in and and million, be operations prior for from corporate Fertilizer North $XX with which out This operations as had in Sugar venture last in the improvements with negative during $XX American consumer a logistics. and South improved performance-based earlier was business. decrease the of response the strong strong from million, last strong year, million due the operations, accruals higher Grains, supply as distribution BP America and demand. to of in benefited excellent our Beyond up to our with North for from Brazilian and year corporate Bioenergy in higher adjusted contributions off had to Europe compares margins corporate also from results North Higher driven were demand XX-XX renewable in and the investment. Earnings our were year. In due In our Results the trading also to our for quarter origination depreciation joint prices. primarily American Results well driven was & other year our results a in by exceptional were to an impacted benefited a of from of quarter. as primarily classified volumes Brazil of prior prices were were rice last as to primarily with by expenses America, and $X by risk margins tight the margins. held higher operation lower the The results in by well costs. compared which $XX Soy prior lower to as earnings EBIT ethanol strong in margins. as local Europe. the optimization volumes very comprised diesel from corporate America as to were The America, of Results being with finishing increase Total negative loss quarter Earnings from XXXX, decreased average declined from lower year million $XXX in the prior were benefited currency reflects global industrial offset due by year to in offset a milling farmers earnings quarter with management benefited execution finished million South by in as in Edible Results sale. a the America $XX volumes year. sector line efficiency. was in favorable In other million driven turned for lower North timing customers. similar lower in other increased negative lower a Oils year very largely line were quarter as our spike Asia, Milling, from during in other. demand also results compensation and $XX Asian year-over-year from by sold local driven in related key quarter largely due sales and in and and higher the impact

prior million, was tax income. during For Adjusting primarily $XXX income for ended due for year our higher expense earnings tax effective income tax $XX The XXXX, was year of prices primarily quarter under XX%. December and million interest and the just due compared was forecast to and due Debt was than to effective $XX in notable than the respectively, to tax for pretax million short-term increase commodity expense XXXX items, borrowings higher and to prior rate the volumes. $XX slightly respectively; XX, lower forecast The support million higher rate our $XX was expense year. increased mix. to prior million, the

Let’s turn X. Slide to

for earnings and over of compares our million full our strategy savings underlying the to drive years, update. toward year. to and see June business positive the can $XX trend, you Here, the achieved to differences, strengthen adjusted XXXX Slide in X savings X established as adjusted our of $XX SG&A $XX of target our past addressable operational notable portfolio year performance, financial SG&A million reflecting We prior our discipline. items execution timing our optimize million

pleased of COVID-XX-related restrictions, are was progress, our such due to accelerated portion we reduced recognize savings travel. While as with we the a

we The accruals further and learned differently, on operate streamlining will we return all the our million and items continue as we fluctuations. slightly focus won’t business. to net reflects in specified foreign levels have as impact such are compensation we performance performance-based increase confident $XX increase due of this offset other to in currency by of However, a the financial pre-pandemic our improved items significant year, to inflation

amount, XX The our cash to dividends and items and dividends, over excluding Moving common available. of adjusted environmental had funds we sustaining $XXX us maintenance, million with allocating were to of this mark-to-market timing Slide obligations X, notable from strong million to funds discretionary billion growth our the preferred differences, capital retained we $XX CapEx flow from billion of reduce to of cash cash cash year Slide million to $X.X generation, our $X.X generation CapEx adjusted shareholders, stock. cash $XXX operations. approximately health allocation approximately After productivity $XXX enabled safety back apply and year of and paid flow Of comfortably billion bought in million million invested $XXX our fund and $X.X operations. include to in for of debt. summarizes XXXX, and the full

was strengthen of objective our cash support $X.X of As shown in balance used billion previously, BBB/BaaX. remaining rating sheet our approximately flow the credit of to

to billion of flow on a our Moving cash of Slide year this $X.X portion outflow XX, working cash capital. of retained $X.X offset the for billion

rose debt inventories and an net increase course of the decision growth capital marketable result, optimize prices our a primarily deliberate resulting $X.X by in over As commodity higher to billion year. working readily increase in earnings potential. from reflects volumes to The the

As unchanged, liquidity XXXX. as shows, leaving credit our we committed the lines slide largely availability enter under ample us with remained

XX% our last uses As at the turn see X% other on can you used This readily fourth Please inventories. only XX. debt end XX, the than marketable quarter, to of Slide year. fund Slide to to of net compares was

or over X.X% up as ROIC cost adjusted in RMI-adjusted tool above weighted reflects X.X weighted profit. ROIC well have merchandising stated cost effectively how X% of of XX.X% we or target of return our RMI points our to percentage average using a from was been of average XXXX. percentage XXXX, points these The X.X%, over incremental spread generate of capital metrics capital was and For XX.X% between our and widening X%. X.X

have past a actions on of picture year-end performance the exchange impact book return have in years. adjusted rates the X over changes to clearer this management of XXXX. provides our foreign the As metrics believe as a reminder, of We equity we economic from we exclude taken these

can cash flow measured cash equity our of of you our generation X%. trend, here see yield XX, cost Slide emphasizes to which Moving against

end For XX%, produced XX to flow XXXX Please XXXX, we XX, year XXXX. of outlook. Slide year up the yield turn December and ending a cash XX.X% our nearly from at

least we Brazil. adjusted taking account per origination be from curves, Agribusiness, margin XXXX share. driven As in EPS the $X full down year forward XXXX, from expected his environment to at contributions and full into by lower year in Greg mentioned and current remarks, processing are In primarily expect of oilseed primarily results

recovery a renewable In full are Oils, be expected year. expected not offset results to results business consumer be same in of and some In full our do to demand foodservice in North year demand, joint by and are by to from are last we XXXX, contributor, In are comparable strong our line Edible or results outlook lower American opportunities in our the to see we improved captured to the full year ethanol results in be positive resulting potential by last be are in be Brazil. While increased Brazilian Milling, sugar Higher in to business, we diesel driven full during year to commodity that & a a forecasting year. magnitude expected and upside strong In Sugar year. year expected results with unique tight supplies. environment Fertilizer, results down venture are prior prices. from expected Bioenergy non-core, driven

effective $XXX expects the $XXX range rate capital range Additionally, to and and $XXX million. of turn closing I million; Greg in an some expense XX%; expenditures the for XXXX: things annual approximately to million; depreciation back that, of of amortization debt in over comments. $XXX to of company $XXX for to in the the will With adjusted tax following range interest million XX% the million

Greg Heckman

Thanks, John.

closing ambitious from see few thoughts. can changes for a offer transformation goals and the Bunge’s we to want I Q&A, made. results to turning Before We we set the

continuous the completed as of cycle we focus improvement able we across the business move and laid forward. we originally that to the Now we have actions growing out, are majority on the

in we capture we’ve XXXX, be and platform are upside opportunities the we the for minimize As our model to leveraging us and look downside. effectively put going of the operating ahead work we in as place to did and the

of The surely the I to on Bunge questions. and we Looking I primary while on in seeing structural over platform. different growth: continued fuel. areas position am confident a oilseeds challenges and feed to term, team feedstock consumer And origination; in team’s for we of culture are your and longer trends. are and have the four benefit XXXX plant leadership present the will we particular, believe And call ingredients, about incredibly food, we unique to right entire demand focus we from the we Oilseed and focusing excited is execution. which look leadership, proud lipid continuing Bunge’s remain together our are and with renewable And In shift fats innovation those protein will the with And forward platform, plant our the to that, and work I are maximize potential. for ingredients; processing of full specialty global bio-fuels; oils. we to open opportunities,

Operator

from first Zaslow The today of ahead. Please Instructions] question [Operator Bank Montreal. go Ken comes of

Ken Zaslow

Hey, good everyone. morning

Greg Heckman

Ken. Good morning,

Ken Zaslow

cost using is I cost talked just has ago? a And improve relative out – you you the you not to it $X baseline, that structure, in My the the where just and how that that are question if cost about a improved first $X as it improvements I that but number structure have your terms started of of you number, say kind $X number, able year relative would the you to reduction to structure, use believe less of downtime.

Greg Heckman

are focus commercial really, enough coordination. there, we quality mean right teams yields. the say, the we and the differences the me I I I say mean, but Ken. some made, John clarify a bit running number, I the it’s on sweating getting and let talk talk of I of can’t the to driving that industrial and course, should how assets when the will mean, let I about the little of assets.

coordination the and downtime, that to that’s and all look having You our ready assets you commercial downtime, by utilization the reducing run reducing you’re seeing. the capacity at unplanned up at look commercial the team and industrial those commercial –

even sure the year that’s we see the times those downtime XXXX. doing make cost that’s capture planned some the opportunity into times. that then the to before one we’re even that right our improvements. highest-margin our in So of here the And maintenance, lower And and we turnarounds, managing to that times and additional focus

the important just So give we talking start that before are really to team. we are think you the are costs, making want I changes really to about I even operating, way credit and in the systemic

John Neppl

one we forward. of from around a of just on at per I ton. more side, to due specifically, here that under overall. – much, say overall, year saw area this improvement fixed variable an but FX-related would as that’s year-over-year a And some to $XX we a benefit we side. look little But improved Ken, side metric Yes. million variable things benefit. we the obviously cost of there then that strong here well – Part efficiency roughly ton is as on believe $X heading we made And the the that’s focus a be not of cost on going was improvement

Ken Zaslow

least baseline you Can your one is that a And it Would you – to improvement it $X.XX? $X.XX relative at or $X.XX, put a fundamental say of have then framework? number, would I a that some be question. is sort into

John Neppl

a our of would Yes. little say $X that that built we I baseline. into had bit

ahead than we keep pushing little that are be anymore a maybe going say I on that, We would but $X.XX, are $X.XX. yet, I schedule but that don’t it. probably would probably to if know on it’s of

Greg Heckman

$X $X improvement will the Ken food say by probably will lower baseline, see is we track on $X crush for we the in track are BXB at the on better I really think self-help the probably the $X would we’re offset the One versus there. about on there. if BXC be both but you the are drivers. of year. on margins difference on least what oils is and side, really and around Those baseline next calling soy edible the between big soft it’s on

Ken Zaslow

as of that’s is the oil bean you is that or how at edible diesel crush driven something does am the my look actually the on in And is oils that incremental included is, renewable how margins it And question understanding the oil both think in of just to seem there. by are what completely at diesel side oil and as – of that’s that I in because to business? looking that. edible second cash renewable the trading that’s your edible my I’ll then forecast, the sustainable? well is And Do you market. that oils seeing leave ahead market diesel, me impact And renewable it

Greg Heckman

diesel to me Yes. Look, that little going the a effect right. start being of structural, let XXXX. saw renewable This said, bit by demand in long-term. of this we saying that be only is That is

made, to sun of We we diesel investments they in the that bit renewable is is being starting in to been reformulation ‘XX, That in bases side. demand, will are And The really because sheet has structural on going and was oil are one little renewable oils start in had happening In to crush. But lot the see the coming capacity and we a no a around what’s that food is feeling what’s that will oils – and was will global Black balance the come functionality. then with with been online glad really yes with effect that on can from we that shift. shift we the doubt course here Argentine of been different XXXX that globally basic be able feel on and there that driven price that there has on tightening use the Sea always XXXX. are reformulate palm in all of and be with and and demand the look, multiyear. a the coming on industry

and going customers on made for the is frankly oils, this portfolio the successful. Bunge be basic help dislocation all a oils, reformulation change So there and to tropical our will including be in and of the lot being and really

them forward looking are helping we with working and So them to win.

Ken Zaslow

Great. Thank you.

Operator

go Please The Stephens next question of is from ahead. Inc. Bienvenu Ben

Ben Bienvenu

everybody. good Hey, morning

Greg Heckman

morning, Good Ben.

Ben Bienvenu

than And kind is two, the guidance, within still around you of the lower I where that historical midpoint do are run-rate return over within obviously capital see and that a One, see by lying $XXX asking highest do spend. more want business? this priorities the evolving CapEx, about of time? start up million CapEx intensity year-over-year, of portfolio the the reasonable projects but for CapEx where you to the

John Neppl

Yes. Thanks, Ken.

at our last I the it, CapEx fourth lowest year the years. this look was it’s – in think the way been many to

so that Where maintenance, the of down growth I on growth providing And around on Generally, $XXX side. was COVID which indicative spending the think The environmental, are million pretty we side. and why we impact $XXX on really really think maintenance, is I ongoing in historically health, your that’s a the which that had here safety, to that year. around we and do spending on was the to indicative million been on is our of rate. we guidance was XXXX, midpoint has million, maintenance good more a productivity point, it benchmark side $XXX of expand for, expect

with kind forward, strong to some the are allocate maintain we is proteins that that some diesel specific focus, business, spending of plant-based we we do going really out key areas we been capital us to and have are areas to of I where to area the going there position where time. on an area continuing renewable expect focus Greg globally. to core terms oilseeds four Obviously, there, In mean, touched opportunities going for

then well well. and business as as lipids oils our have fats plant pipeline or We there the specialty our and under in some projects

The requirements, guideline the pipeline. don’t $XXX enough kind our but have for meet million and The money. in a won’t so we higher opportunity. to hurdle it’s lot opportunities we projects, are but better of we us number going on the And could good be based now, be find is if if spend they the a

I right – So think guess. a but now, good pretty it’s

Greg Heckman

around The decisions, at I is capital make say about would alternatives to big one mean, I one changed that’s disciplined process like we have. the as looking the we other thing that and thing those really

all at no or global and of the at regionally And are so opportunities level. up adding is looking remember, There the by we allocation business.

business is capital. every competing So, for that

the that when analysis a looking at and work. comfortable by long-lived we so testing put And having the and where have have project that to see We the on we plant that talked really the different oilseed discipline protein. in in place assumptions added oils, scenario growth here definitely about all stress core on stressing around of the trends big renewable fats in business, but are diesel and are in opportunities, these the crushing, then we areas course, and our especially we capital are

So, right. We to and be the don’t projects chances that and allows are is don’t and profile us very thoughtful returns make choices make the sense. reach right risk have where take to on that

Ben Bienvenu

soybean on – Understood. be on and question My second we’ve crush lack along Obviously, we of a in near-term-oriented out is the tie as seen the between The could China out of that’s little U.S. know great. how Okay, that delayed corn look soybean you And and bit on fundamentals. margins How a then in crop. more forward go you seeing forward just got harvest mindful the I if corn we’ve about Brazil of half this What global delayed come impacting U.S. period? first availability. overall this weakened the should terms like planting quarter South you’re the curve. into origination business. America of unusual is kind of do how business? transitory crushing crush of what we strong China. and in first think continued seen from buying We’ve year-to-date year safrinha

Greg Heckman

Sure.

and going American the with crop thing this in first then North isn’t South two solve the one with American think the itself I is crop South to America, crops. crops or even

crop see the We’ve here. to planted. hit need develop fight crop key things the out in appropriately. to need in get And strongly. harvested get to the Argentina we finish North good So safrinha yes, planted we’ll on you see have acres a got to We and and crop. to be the that for that get then We continue Brazil, need America,

way. that the really tightened and sheets up that’s they’re stay system. balance these to entire for And margins in So the throughout year, last are been good global going

work so as to continue we expect that see through to here we And XXXX.

front, supply have got need market right? know a harder got say, of signal provide you it play And different I’m the we that this footprint what to to we of that now that processing some some Argentina we the the running signals, know is run As on little and we back to need how it. the It’s into glad is get sending don’t do Argentina. sending in do the bit the really year we but And that the global balance. market exactly we’ve we’ve the that out, needs team will crush

to forward the the and looking we’re opportunity. challenge So

Ben Bienvenu

Okay. Congrats luck on XXXX. in Good XXXX.

Greg Heckman

Thank you very much.

Operator

question is with from Adam Goldman next ahead. Sachs. go The Samuelson Please

Adam Samuelson

Yes, Good everyone. thanks. morning

Greg Heckman

Adam good Hey, morning,

Adam Samuelson

my a So to from differently bit, around And going plus. guess Ken think trying I XXXX I is about of maybe I’m $X it to coming year-on-year a be perspective. on from outlook $X guess that the question baseline basis little

adjusted the kind neutral, $X.XX If Food half net negative. XXXX. base of included & did the interest, I I of in at year. the sugar would first And maybe look you slightly of losses So net kind the of in Ingredients that tax, believe be Agribusiness, everything kind the but in businesses, FX-related of about $X.XX sugar,

$X.XX-ish. So kind for baseline piece, is, adjusting kind maybe year-on-year that FX of your of

And but like a that kind so that of of And thinking I’m benefited drivers helping tightness steep just very than had outcomes just Agribusiness. be Because to would decline if to and year, will obviously of so million of bridge EBIT still you in trying within that’s kind some the $XXX frame make fall different implying true, year-on-year be the to the the pretty market and I’m get in about of drivers Agribusiness. intact. seem you to or the that sure demand $X, for a range be again, environment much somewhat seems underlying a last

So trying to I’m just a that little reconcile bit?

Greg Heckman

Sure. Yes.

But business. you Edible as consumer, by what be be we of Oils, What correct. think offset think said will don’t that the Edible part in more Oils and the BXC I year. of than seeing, good BXB the the expect side to the foodservice we is we’re this

and XXXX see the same entering for definitely QX And then about So in start see with year what we’re XXXX. than start to momentum, here we some QX scratch. this had we yes, we a excellent at last that’s time while could better

have about that – we the think in XXXX. talked higher thing higher balance to volumes, platform benefits from dislocation, did about And other As the the don’t our see usual, of we we to really visibility is saw the definitely we year. volatility, and higher prices,

way. We the pattern doubt – the the And would imagine. farmer happen that Brazilian and hard real also way. south the happening in to be the saw marketed. same same the way we not That’s the a will move marketing That with

volatilities setup part these higher is of So the the and of has market, it making the is a prices higher made and move to adjustments. it part of is market some

don’t at into this call last So XXXX the better year while for feel the than I be seen way of better years, But happen to it in and making the than the everything call we’ve you, we’re overall XXXX. we making, I’ll the about time year. half, have recreate environment, kind lower full definitely would at were visibility time least it this hard second which did to same the at $X for was we tell way optimistic.

but We measured we we’re of look, a optimistic. also are good, moving lot and feel pieces. So there’s

John Neppl

really The guidance mention, a might XX.X%, one you didn’t we that on this XXXX And that you and for add tax had XX%. to just thing Adam, be I year on, about rate your and between I think were of we’re close calling XX% pieces.

as of have impact a an would that well. So bit

Adam Samuelson

No, Yes. no, helpful. that’s

if allocation Okay. of allocation to – actually One, match kind net year. maturity with second And that parts. into readily marketable debt your maybe down bit, opportunities inventories, guess question mix of and front, is offensive on that an thinking I capital given is of cost a liability? debt there just the really in Is long-term two maybe balance just rising to capital the the opportunity to this net the of nature. that the duration is and you. more we little opportunities figuring repurchases the think get maybe thinking how the the kind second, then opportunity share Thank of for just there in in And should bring more about more you about

John Neppl

the we’ve duration a of debt right debt lot right a and from spending portfolio. of standpoint, looking mix at So time the been our

million in we I think was we’ve in lowest August, issued it $XXX just we’ve been in on able printed the was bonds August our to, for at bonds. over example when ever X.X%,

has added long-term, thinking we about in same in all rates capacity the the to near-term here QX lock the so And all of nature. after time, debt are favorable really short-term in QX been and long-term. that the in have we’ve At

but what there not So we the years. trying right to out the still forward, on based X next – over to over just environment, current balance expect also the we are sort maybe XX going

And at so continue we’ll that. to look

long-term forward as feel to and pretty debt of our cost at of But net that think go take some years, haven’t yet. chance some good we that in final look conclusion debt to out here longer, the I the come debt going we of maturing we’re short-term. next on our risk about rates the couple And some a refinancing, look at are to what today. you versus out take obviously, we there’s if but

investment-grade terms capital, back we credit been of get We’ve ratings just committed allocation our priority to a of our as want is now right rating. them. where reminder, to In to main

we’re We’re there where notch like below Moody’s with Fitch we’d S&P, be. with but and to a

years that, is haven’t get our May. we to our But into beyond continue It will be policy in first foremost. X raised we buckets. really make at look objective, our that One that we capital X So dividend, our years. once in then and sure will allocation almost fit capital X dividend and and we

do like policy, the talk year about – a we hard at year, to it. Board at and our revisit we and Board the we we’ll our every and look May meeting that this take dividend So

X to to for a got areas. sense then always pipeline the if on buybacks They ultimately, look they them. I do segment us always opportunities good share X make want for And we mentioned we’ve Secondly, to pipeline. our across of And And focus good And – opportunities. growth think table. have the Greg are don’t, we won’t.

the mix. part that as that’s growth, so we’ll I share If buybacks, of And about assessing think together forward. capital we go all and be dividends, of

Adam Samuelson

I on. Thank it you. Okay. color. pass that I really will appreciate all

John Neppl

Thank you.

Operator

next is ahead. Tom Please The question JPMorgan. from of go Simonitsch

Tom Simonitsch

everyone. morning Good Thanks.

Greg Heckman

Hey, good morning, Tom.

Tom Simonitsch

around assumptions did historical Can I $XX are in and a XXXX XXXX in just to crush ask margins soy ton the relative a $XX what softseed your against ton shape how averages? and historical up your those margins margin you highlighted June

Greg Heckman

Yes.

up soy year dollars in $XX a model the a the we $X we to So basis $XX had comparable couple for baseline. now, the at finishing at right at the the And better looking on than ended baseline. being of soy we’re $XX

our we $XX. in expect half, not to don’t course, be this time. it the at it realize, Of we on second quarter as expecting the with year around we’re than realized better out the we it footprint, what how good as but visibility a here see to – we’ll much better we rolls market, be And than a execution but

Tom Simonitsch

And on the softseed side?

Greg Heckman

last Soft a expect bit to was than year, strong better it well. little be and as baseline we

Tom Simonitsch

America the wouldn’t quick one just on weaker in then QX mind you And if Milling? one, you. elaborating margins thank North Okay,

John Neppl

bit Just was really No timing, I think big problem a overall. of everything. little it

part out which the Of came sold course, Milling. of rice, we

out well And diesel U.S., there. that’s to in had in premix mix volumes we of had and you bit were asking on course, volume, then volume the some that’s down the business. U.S. a were little guess some some of lower really of continued our the Of we’ve I struggle lower as and driver. then there And Mexico, We we had Brazilian and

Tom Simonitsch

Thanks on. I it will pass much. very

Greg Heckman

Thank you.

Operator

question Theurer next is Barclays. from Please of Our go Ben ahead.

Ben Theurer

Thanks. all and of congrats the first everybody strong Good results. morning on

John Neppl

morning. Good you. Thank

Greg Heckman

Ben. Thanks,

Ben Theurer

So, two questions.

business, comparison where stay to I and U.S. heading think of That Brazilian I to, what are question. share but to the your So the what are now? mean, commentary bit be it just understand to outlook along piece, on Brazilian into dig to would is bit into a first an mean, little just they can more crush you one, the means the a the expectations I crush? a general right in situation my little

Greg Heckman

then And margin at spot low values. Brazil, of second in Argentina half the continues course, in it’s on the here going strong of stay to Currently, we’re there. in been down is that Brazil first running part And the be be but half. demand. very XX expect Yes. watching to key on and bean export volatile to constricted We’ll that’s the the really

Ben Theurer

and go And actually businesses, gearing clearly, what new and here. mentioned more the to coming the reshape. about opportunities And whole like diesel, and a bit question up you’ve on CapEx you’re been on to renewable margins back, also little tying be and then doing to the just you’ve well, add – in the out portfolio outlook drive around

CapEx potential how just of about do how and So Sugar to into renewable diesel? in does we & you the non-core, should is business think you of this of that, light Where opportunities what see now sale the because funding been the still say source Bioenergy, CapEx you next and going going guidance cash think an that’s additional on take we year? give the for doing to but keep well that forward? or of you combine potential for So is it’s shall just

Greg Heckman

Yes.

Look, plants course, those customers and bring in them things is, new diesel those demand we’ll new North working that up. to take here do renewable the we’re of Let first. as get America me they supplied first helping with and

been – and we we’ll look of thing projects course, at are other The our at debottlenecking had the is, cheapest highest-returning those facilities the looking projects. existing course and capacity of

to logistics, tankage, maybe do meet But we we’ll where free around market the those low-risk, up we’ll see sense. demand. incremental capacity. demand That’s be we course, high-returning things the backwards work probably will analyze do our customers so But only first around those. So those. And volume to as investments of and something in incremental make the refineries projects, will – are or then that those with

doing serve is that So team do, structural needs to be far going job in very demand We be of growing a & going got thoughtful we about discipline. is this place. we’re as partner being Which Sugar to great to Bioenergy, then down there. in is this a industry And show how and BP. lot a great is thoughtful as and

sugar there the sheets global balance and the down overall in there. environment both We are ethanol seeing prices improve and

plans back for portfolio. which outlook doesn’t time balance that. appropriate proceeds reinvest change business good the exit the That into our a our that of at like looks will that and So we there, long-term the

Ben Theurer

for very congrats XXXX. and much Perfect. Well, and luck that’s good thank you key. Well, very again

Greg Heckman

much. very you Thank

Operator

from The Morgan Stanley. next Please is Vincent Andrews ahead. with question go

Steven Haynes

Hi. Vincent. Steven Haynes This is on for

the question ask in cash a And downside, in but of – Just regards operating XXXX the you being on a good still really to quick very guidance. in management, $X able risk limiting to want to job terms environment. of a did attractive in

how you’re underlying I kind the help can So opportunity half versus for crush? positioned, guess, within earnings of us about think of you the first kind

Greg Heckman

Yes.

got of is where As crush, hedged kind quarter closing the you’ve is up. majority the you generally, know,

the front. the and – margins much out outlook, inverted not markets as visibility crush With usually

continue how our those we think look So to which those manage is kind to to that and assets at about of believe at earnings position maniacal the opportunities we we focus. need risk,

it starting with stronger, And the glad we’ve of be the continue to stay asset the this are like with we’re years. environment. in environment out coming managing a we’re we on seen the few that risk different on momentum ensuring base. it’s team. but in the QX little we focused We than those world power earnings for like to We earnings here a at based and doing And

Steven Haynes

Okay. you. Thank

Operator

closing remarks. I This concludes back now to Ruth turn Ann like question-and-answer the any our session. to for would conference Wisener over

Ruth Ann Wisener

your for Bunge in today. joining the call Thanks interest and

out. If feel reach further to free questions, you have

Operator

has attending now today’s Thank concluded. conference The for you presentation.

disconnect. now may You

Bunge Limited (BG) 11 Feb 212020 Q4 Earnings call transcript