Monument Circle Acquisition Corp (MON)

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More on MON’s FY4Q11 results (from WSJ):

http://online.wsj.com/article/SB10001424052970203388804576612654289321980.html

›Monsanto Sees Rise in Seed Sales

OCTOBER 5, 2011, 3:09 P.M. ET
By IAN BERRY

Monsanto Co. expects seed sales to climb as farmers in the U.S., and, increasingly, South America look to boost output, as the company recovers from a customer revolt over pricing last year.

Shares of the world's largest seed producer by revenue are up 35% over the last year as it lowered prices to ease farmer concerns and benefited from rising global demand for crops. Monsanto reported earnings Wednesday ahead of expectations and forecast earnings growth of around 15% [actually, 13-16%] for next year, fueled by increased sales in Brazil and Argentina.

"It's clear that we have turned the corner and returned to growth mode," said Hugh Grant, chief executive of the St. Louis-based company.

Monsanto's share price plummeted last year as problems mounted and the company had to abandon its long-term financial goals. Besides the farmer backlash, prices for a key herbicide Monsanto produces fell sharply in the face of Chinese competition.

Over the past year, the company has benefited from a booming agricultural sector, which it doesn't see slowing. Mr. Grant noted the profits of farmers will approach record highs this year [Grant said US aggregate farm income will be one of the 2 or 3 best years ever, if not the best], and the company already has said it plans to increase prices for corn seed by 5% to 10% next year.

Still, a more than 25% dip in futures prices for corn from record highs in June could present a challenge to the company's growth projections as farmers have less of an incentive to plant as many acres as possible.

"If we continue to see commodity prices decline, it might be difficult to get those pricing levels," said Jeff Windau, a St. Louis-based analyst for Edward Jones.

For the fiscal fourth quarter, Monsanto reported a loss of $112 million, or 21 cents a share, compared with a year-earlier loss of $143 million, or 26 cents a share. In May, the company had said it expected a loss of 26 cents to 30 cents a share for the quarter.

Mr. Grant said the company gained market share in corn seed and stabilized its share of the soybean seed market after recent erosion. Monsanto's business in the year ahead will continue to revolve around the U.S but with an increased focus on South America.

Brazil and Argentina have rapidly adopted the use of seeds that have been genetically modified to increase production [and now offer insect protection (#msg-53568148, #msg-55517002)], increasing the demand for Monsanto's higher-priced offerings.

The company's herbicide business remains challenged amid a flood of cheap Chinese generics. Mr. Grant said the company would continue to offer glyphosate—sold by Monsanto under the Roundup name—at prices just above Chinese prices.

"It was such a great business, and now it continues to be a drag on the company," said Mr. Windau, the Edward Jones analyst.

Monsanto also on Wednesday said it would adjust portions of its financial statements from the fourth quarter of fiscal 2009 through the third quarter of fiscal 2011 in response to a U.S. Securities and Exchange Commission inquiry into customer incentives as part of its herbicide sales. Total revenue and costs over the period won't be affected, though the change in timing will lead to adjustments in the bottom lines. The company no longer provides the customer incentives and said it continues to corporate with the SEC investigation.‹