(Bloomberg) — Archer-Daniels-Midland Co. (ADM) said it will amend previous financial statements after finding additional accounting issues, prompting the crop trader to cancel its quarterly earnings call with analysts 14 hours before its start.
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The move adds a new chapter to a scandal that wiped more than $8 billion of ADM’s market value on a single day earlier this year, prompted investigations by the US Department of Justice and Securities and Exchange Commission into its accounting practices, and led the company to remove Vikram Luthar as chief financial officer.
ADM identified additional errors in the way it reported sales between its Ag Services and Oilseeds, Carbohydrate Solutions and Nutrition business segments while testing new controls, the crop trader said in a statement. The company, following discussions with the SEC, will amend its 2023 Form 10-K, as well as financial statements for the first and second quarters of 2024, which it said is not expected to result in any material impact.
The Chicago-based company expects to complete the restatements “as soon as reasonably practicable.” ADM also slashed its 2024 profit estimates.
ADM has been thrown into disarray since disclosing in January an internal inquiry into transactions between the nutrition business and other segments of the company. The scandal, which sent shares plunging a record 24% on a single day, put a spotlight on Chief Executive Officer Juan Luciano’s push to lessen ADM’s dependence on its traditional business of trading corn and soybeans and refining ethanol.
The Argentine-born industrial engineer spent billions to acquire Wild Flavors GmbH and animal-feed maker Neovia — the company’s largest-ever deals — in a bid to turn ADM into a nutrition powerhouse. But that bet has failed to live up to expectations, due in part to faltering demand for plant-based ingredients and animal feed.
The company has also faced a decline in crop prices around the globe and lower profits from processing soybeans into meal and oil — a key earnings driver — amid increased crushing capacity in the US. ADM has also closed its only soybean crushing facility in Iowa during the harvest of a record US crop for maintenance, further eroding its ability to gain from processing.
