• Reported EPS (Q4 2024): $4.36 compared to $4.18 in Q4 2023.
• Adjusted EPS (Q4 2024): $2.13 compared to $3.70 in the prior year.
• Adjusted Core Segment EBIT (Q4 2024): $548 million, including $52 million from Ukraine business interruption insurance recovery, versus $881 million last year.
• Share Repurchases (2024): $1.1 billion.
• Adjusted Funds from Operations (2024): Approximately $1.7 billion.
• Capital Expenditures (2024): Approximately $1.4 billion.
• Net Debt to Adjusted EBITDA Ratio (End of 2024): 0.6 times.
• Cash Balance (End of 2024): Approximately $3.3 billion.
• Adjusted ROIC (2024): 11.4%.
• 2025 Full Year Adjusted EPS Outlook: Approximately $7.75.
• 2025 Capital Expenditures Forecast: $1.5 billion to $1.7 billion.
• 2025 Adjusted Effective Tax Rate Forecast: 21% to 25%.

• Warning! GuruFocus has detected 4 Warning Sign with BG.

Release Date: February 05, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Bunge Global SA (NYSE:BG) is making significant progress on growth projects and strategic initiatives, including the business combination with Viterra and the acquisition of CJ Selecta.
• The company has received regulatory approval from the Canadian government for the Viterra transaction and is in the late stages of the regulatory process in China and Europe.
• Bunge Global SA (NYSE:BG) has completed the sale of its sugar and bioenergy joint venture in Brazil to BP, streamlining its business and allowing for expanded stock repurchases.
• The company returned $1.1 billion to shareholders through share repurchases in 2024, emphasizing its commitment to capital allocation strategies.
• Bunge Global SA (NYSE:BG) is advancing its sustainability priorities, achieving 100% traceability and monitoring of soy purchases in Brazil's priority regions.

Negative Points

• The fourth quarter results were below expectations, particularly in South America, due to challenging market conditions impacting industry margins.
• The company is facing increased geopolitical uncertainty, which limits forward visibility and affects its ability to provide a comprehensive outlook.
• Bunge Global SA (NYSE:BG) expects lower margins in North America and Europe, which could offset improvements in South America.
• The company is experiencing higher corporate expenses driven by performance-based compensation and project-related costs.
• There is uncertainty around US biofuel policy, which could impact refining premiums and demand for soybean oil.

Q & A Highlights

Q: Can you provide more details on the 2025 guidance and the factors influencing it, including any conservatism built into the guidance? How are you accounting for policy uncertainty, particularly regarding 45Z? A: (Gregory Heckman, CEO) The 2025 environment has less visibility due to trade disruptions and US biofuels uncertainty. However, global oil supply and demand are constructive, with soy taking a larger share of global flows. We expect improved performance in South America, offset by lower margins in North America and Europe. (John Neppl, CFO) We assume lower US crush margins and more challenging refining premiums due to policy uncertainty.

Q: Given the expected improvement in South America, what are the global offsets that might lead to softer results in 2025, particularly in merchandising? A: (Gregory Heckman, CEO) We anticipate a more balanced global supply and demand situation across grains and oilseeds, making it challenging to predict merchandising opportunities. The complexity of the current situation is unlikely to worsen, and clarity is expected in the second half. (John Neppl, CFO) The biggest year-over-year delta is in ocean freight, driven by lower flat prices, but trade flow changes could provide opportunities.

Q: How are you thinking about the Viterra acquisition given the current policy environment and potential export tariffs on Canada? A: (Gregory Heckman, CEO) The biofuels policy is still evolving, but canola remains favored by the food industry and dairy sector. (John Neppl, CFO) We are monitoring US-Canada relations, but long-term policy clarity will allow market adjustments. The Viterra combination strengthens our global position to manage disruptions.

Q: Can you discuss the financial implications of the Viterra and CJ Selecta acquisitions? A: (John Neppl, CFO) Viterra is expected to be neutral to slightly positive in the first year after capturing synergies and share buybacks. We will provide clarity on 2025 post-close. CJ Selecta is expected to deliver mid-teen returns, and our assumptions remain intact.

Q: How should we think about capital allocation and CapEx for 2025? A: (John Neppl, CFO) We have $800 million left for share buybacks, which will be done opportunistically. CapEx is expected to be $1.5 billion to $1.7 billion, down from the original $1.9 billion to $2 billion, due to timing shifts and decisions to forego some projects.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.