CHICAGO, Feb 7 (Reuters) - Agricultural commodities trader Bunge Global SA (BG.N), opens new tab on Wednesday beat Wall Street estimates with a record fourth-quarter adjusted profit as strong oilseed processing results boosted its core agribusiness division.
The company, however, forecast a drop in adjusted profit in the year ahead due to narrowing crush margins.
The fourth-quarter earnings beat comes as Bunge is working to close a deal to acquire grain handler Viterra by midyear, a merger that would create an agribusiness powerhouse closer in size to its chief rivals Cargill (CARG.UL) and Archer-Daniels-Midland (ADM.N), opens new tab.
Agribusinesses make money by processing, trading and shipping crops around the world, often benefiting when crises such as droughts or war trigger shortages.
Bunge posted an adjusted profit of $3.70 per share for the three months ended Dec. 31, up from $3.24 per share in the same quarter a year earlier and above analysts' average estimate of $2.81, based on LSEG data.
It was also Bunge's strongest fourth-quarter profit on record, LSEG data showed.
Rising costs, volatile markets and supply chain disruptions have at times created headwinds for crop traders and processors.
Bunge said it expected full-year adjusted earnings to decline to $9 per share in 2024, from $13.66 last year, due largely to weaker processing margins. The forecast does not include the pending Viterra acquisition, which Bunge is aiming to close by midyear.
Earnings from its core agribusiness division, its largest by revenue and volume, jumped 89% to $835 million in the fourth quarter from a year earlier.
Strong oilseed processing returns in South America, Europe and Canada offset a weaker quarter for processing in the United States, the company said.
Earnings in Bunge's merchandising operations dropped sharply due to lower margins and weaker ocean freight results.
Bunge shares were up 2.2% at $92.00 in premarket trading.
Reporting by Karl Plume in Chicago, additional reporting by Tanay Dhumal in Bengaluru; Editing by Sriraj Kalluvila and Jane Merriman