Monsanto Lowers 2016 Earnings Outlook - Quick Facts

(RTTNews) - Agricultural products giant Monsanto Co. (MON) on Wednesday lowered its earnings outlook for fiscal 2016, citing a deteriorating marco environment. The company also forecast earnings for the second quarter below analysts' estimates.

Ahead of the Bank of America Merrill Lynch 2016 Global Agriculture & Chemicals Conference, Monsanto noted that entering the fiscal year 2016, there were several variables creating significant headwinds, namely - weak foreign currencies, generic glyphosate pricing and compressed grower margins coming from lower commodity prices.

According to the company, these have not abated and the company has seen additional headwinds from competitive dynamics and the delay in the EPA label for in crop use of dicamba.

Monsanto now forecasts fiscal 2016 ongoing earnings per share in a range of $4.40 to $5.10 per share and as-reported earnings of $3.42 to $4.29 per share. Earlier, Monsanto forecast full-year ongoing earnings per share to be at the lower half of its prior range of $5.10 to $5.60 and as-reported earnings of $4.12 to $4.79 per share.

On average, 22 analysts polled by Thomson Reuters expect the company to report earnings of $5.14 per share for the year. Analysts' estimates typically exclude special items.

For the second quarter of 2016, Monsanto's full-year outlook translates to ongoing earnings per share expectations of $2.35 to $2.45, with the expected decline versus the prior year primarily driven by glyphosate pricing declines and the Argentine peso devaluation. On as as-reported basis, the company expects earnings for the quarter to be $2.15 to $2.35 per share.

The Street expects earnings of $2.84 per share for the quarter.

However, the company said that beyond fiscal 2016, its key variables and growth drivers reinforce its outlook and opportunity for a baseline mid-teens compounded annual growth rate in its ongoing earnings per share from the mid-point of its fiscal 2016 outlook through fiscal 2019.