WHITE PLAINS, N.Y., Feb. 5 /PRNewswire-FirstCall/ -- Bunge Limited
(NYSE: BG) -- Attained record full year earnings of $1.06 billion
and cash provided by operating activities of $2.5 billion in 2008.
-- Entering 2009 with a comfortable liquidity position and strong
balance sheet. -- Financial Highlights (In millions, except per
share data and percentages) Quarter Ended Year Ended 12/31/08
12/31/07 % Change 12/31/08 12/31/07 % Change Volumes (metric tons)
36.0 34.1 6% 138.5 137.0 1% Net sales $10,943 $12,472 (12)% $52,574
$37,842 39% Total segment EBIT (1,2) $(404) $374 (208)% $1,363
$1,208 13% Agribusiness $(86) $330 (126)% $949 $856 11% Fertilizer
$(289) $52 (656)% $321 $271 18% Edible Oil Products $(47) $4
(1275)% $(11) $45 (124)% Milling products $18 $(12) 250% $104 $36
189% Net (loss) income (2) $(210) $245 (186)% $1,064 $778 37%
(Loss) Earnings per common share - diluted (2,3) $(1.89) $1.82
(204)% $7.73 $5.95 30% (1) Total segment earnings before interest
and tax ("EBIT") is a non-GAAP financial measure. The information
required by Regulation G under the Securities Exchange Act of 1934,
including a reconciliation to net income, is included in the tables
attached to this press release. (2) Bunge's results included
certain gains and charges that may be of interest to investors. See
the Additional Financial Information section included in the tables
attached to this press release for more information. (3) See Note 2
to the consolidated statements of income attached to this press
release for information on the calculation of diluted earnings per
share. -- Overview Alberto Weisser, Bunge's Chairman and Chief
Executive Officer stated, "In 2008, Bunge produced record results
in one of the most volatile years in recent memory. We earned over
$1 billion in net income for the first time and produced $2.5
billion of cash flow from operations. We start 2009 with a
comfortable liquidity position and a strong balance sheet. The weak
global economy will pose challenges, but we see reasons to be
optimistic that conditions for our industry will improve during the
course of the year. "First, periods of lower demand for our core
products are generally short lived. People may cut back consumption
during times of economic uncertainty, but in the end, many of our
products are the basic staples necessary to feed the world's
growing population. We anticipate demand for soybean meal to
improve over the drastic reduction seen late in the fourth quarter,
when customers were reducing capacity, drawing down existing meal
inventories and using lower-cost feed ingredients. Our estimates
for the 2009 calendar year indicate soybean meal demand growth of
about 1.5% when compared to 2008. We also expect demand for
vegetable oils to increase about 4% in the calendar year, although
soy could continue to face competition from other oils. "Second,
global commodity stocks remain tight, and this reality is being
exacerbated by weather issues in South America. Even with lower
economic growth, the world will need additional supplies of crops.
Current futures prices indicate that the market will provide
incentives for farmers to plant, and this should encourage
fertilizer use. "During this time we continue to take steps to
lower costs and improve the efficiency of our asset network. We
expect that the stronger U.S. dollar should benefit the cost
structures of our foreign operations. We are also investing for the
long-term in our core businesses, and in complementary value chains
such as sugar, but we are managing our projects prudently in light
of today's volatile conditions." -- Fourth Quarter Results
Agribusiness Strong softseed processing results in Europe were more
than offset by lower results in soybean processing. Farmer
reluctance to sell soybeans in expectation of higher prices, weak
demand for soybean meal and oil due to challenging economic
conditions in end markets and substitution of other agricultural
commodity products all combined to compress volumes and margins.
Higher grain origination volumes, primarily due to the U.S. harvest
delay and increased corn origination in Brazil, were more than
offset by lower margins. Results in our distribution business were
impacted by lower volumes and margins. Foreign exchange losses of
$165 million from U.S. dollar-denominated financing of working
capital, primarily in our Brazilian subsidiary, were offset by the
positive impact of foreign exchange on valuations of commodity
inventories included in gross profit. In the fourth quarter, the
Brazilian real devalued 18% against the U.S. dollar. Fourth quarter
EBIT included a charge of approximately $185 million related to
counterparty risk provisions resulting from a combination of the
depressed global economy and the adverse impact of significant
declines in agricultural commodity, freight and energy prices on
certain customers and other counterparties. Results for the fourth
quarter of 2008 also included impairment and restructuring charges
of $18 million related to the closure of oilseed processing
facilities and gains of $15 million related to the acquisition of
certain sugar assets. For the fourth quarter of 2007, results
included impairment and restructuring charges of $25 million
related to the closure of oilseed processing facilities. Fertilizer
Fertilizer results in the quarter suffered from low sales activity
and falling prices. Volumes were significantly lower than in 2007,
primarily due to tight farmer credit, and while margins were higher
than in the previous year, they were well below levels experienced
earlier in 2008. Results were also negatively impacted by
approximately $225 million of net foreign exchange losses resulting
from the devaluation of the Brazilian real on U.S.
dollar-denominated financing of working capital. Unlike in
agribusiness where inventories are marked to market, the offsetting
gain on fertilizer inventories is expected to occur in future
quarters when the inventories are sold. Minority interest increased
in the quarter due to higher results at Fosfertil. Fourth quarter
2007 results included a $50 million increase in our value-added-tax
provision, resulting from a change in tax laws in several Brazilian
states that took effect in 2008. Edible Oil Products Results in the
quarter declined primarily due to high raw material costs in Europe
as a result of crude vegetable oil inventories purchased prior to
price declines, as well as aggressive product pricing by
competitors to move inventories. Results included impairment and
restructuring charges of $2 million and $29 million, respectively,
in the fourth quarters of 2008 and 2007. Milling Products Higher
margins in wheat milling were partially offset by lower margins in
corn milling. Fourth quarter 2007 results included a $13 million
impairment charge related to the closure of a wheat milling
facility in Brazil. Financial Costs Interest expense decreased in
the quarter due to lower average debt levels, mostly resulting from
the drop in prices of agricultural commodity inventories which led
to lower average working capital needs. Income Taxes The effective
tax rate for the year ended December 31, 2008 was 16% compared to
26% in 2007. The decrease in the effective tax rate was primarily
due to lower earnings in higher tax jurisdictions. Cash Flow Cash
provided by operating activities in the fourth quarter of 2008 was
$816 million compared to cash provided by operating activities of
$231 million in the same period last year. For the year ended
December 31, 2008, cash provided by operating activities was $2.5
billion compared to cash used for operating activities of $411
million in 2007. The $3 billion year-over-year improvement reflects
higher earnings, efficient working capital management and declining
commodity prices during the second half of the year compared to
increasing prices over much of 2007. -- Outlook Jacqualyn Fouse,
Chief Financial Officer, stated, "Looking ahead, we are confident
in a solid 2009. The first half of the year will present challenges
as we face a soft market environment and work through higher cost
inventories in fertilizer and certain regions of our edible oils
business. We expect stronger results in the second half as soybean
meal demand improves. Tight agricultural commodity supplies should
support Brazilian farm economics and spur fertilizer purchases.
Additionally, the stronger U.S. dollar should benefit the cost
structures of our foreign operations. "In consideration of this
outlook, our 2009 full-year earnings guidance is $6.90 to $7.60 per
share. This fully diluted per share guidance is based on an
estimated weighted average of 138 million shares outstanding, which
includes assumed dilution relating to our convertible preference
shares. "Additionally, our 2009 guidance includes the following: --
Depreciation, Depletion and Amortization: $425 to $445 million. --
Capital Expenditures (net of asset dispositions): $950 to $1,050
million, of which approximately 30% will be invested in
maintenance, safety and environmental projects. -- Tax Rate: 22% to
26%." Conference Call and Webcast Details Bunge Limited's
management will host a conference call at 10:00 a.m. EST on
Thursday, February 5, 2009, to discuss the company's results.
Additionally, a slide presentation to accompany the discussion of
the fourth quarter financial results can be found in the 'Investor
Information' section of our Web site, www.Bunge.com, under
'Investor Presentations'. To listen to the conference call, please
dial (877) 874-1570. If you are located outside of the United
States or Canada, dial (719) 325-4766. Please dial in five to 10
minutes before the scheduled start time. When prompted, enter
confirmation code 3152444. The conference call will also be
available live on the company's Web site at www.Bunge.com. To
access the webcast, click the "Investor Information" link on the
Bunge homepage then select "Webcasts & News Alerts". Click on
the link for the "Q4 2008 Bunge Limited Conference Call," and
follow the prompts to join the call. Please go to the Web site at
least 15 minutes prior to the call to register and to download and
install any necessary audio software. For those who cannot listen
to the live broadcast, a replay of the call will be available later
in the day on February 5, 2009, and continuing through March 7,
2009. To listen to the replay, please dial (888) 203-1112 or, if
located outside of the United States or Canada, dial (719)
457-0820. When prompted, enter confirmation code 3152444. A
rebroadcast of the conference call will also be available on the
company's Web site. To locate the rebroadcast, select the link to
"News & Events" under "Investor Information". The replay will
be available in "Audio Archives". Follow the prompts to access the
replay. About Bunge Bunge Limited (www.Bunge.com, NYSE: BG) is a
leading global agribusiness and food company founded in 1818 and
headquartered in White Plains, New York. Bunge's over 25,000
employees in over 30 countries enhance lives by improving the
global agribusiness and food production chain. The company supplies
fertilizer to farmers in South America, originates, transports and
processes oilseeds, grains and other agricultural commodities
worldwide, produces food products for commercial customers and
consumers and supplies raw materials and services to the biofuels
industry. Cautionary Statement Concerning Forward-Looking
Statements This press release contains both historical and
forward-looking statements. All statements, other than statements
of historical fact are, or may be deemed to be, forward-looking
statements within the meaning of Section 27A of the Securities Act
of 1933, as amended, and Section 21E of the Securities Exchange Act
of 1934, as amended. These forward-looking statements are not based
on historical facts, but rather reflect our current expectations
and projections about our future results, performance, prospects
and opportunities. We have tried to identify these forward-looking
statements by using words including "may," "will," "should,"
"could," "expect," "anticipate," "believe," "intend," "estimate,"
"continue" and similar expressions. These forward-looking
statements are subject to a number of risks, uncertainties and
other factors that could cause our actual results, performance,
prospects or opportunities to differ materially from those
expressed in, or implied by, these forward-looking statements. The
following important factors, among others, could affect our
business and financial performance: governmental policies and laws
affecting our business, including agricultural and trade policies,
as well as biofuels legislation; our ability to complete, integrate
and benefit from acquisitions, divestitures, joint ventures and
strategic alliances; industry conditions, including fluctuations in
supply, demand and prices for agricultural commodities and other
products we sell and use in our business, competitive developments
in our industries and unpredictability of the weather; global and
regional agricultural, economic, financial and commodities market,
political, social and health conditions; and other factors
affecting our business generally. The forward-looking statements
included in this release are made only as of the date of this
release, and except as otherwise required by federal securities
law, we do not have any obligation to publicly update or revise any
forward-looking statements to reflect subsequent events or
circumstances. Additional Financial Information The following table
provides a summary of certain gains and charges that may be of
interest to investors. The table includes a description of these
items and their effect on total earnings before interest and taxes
(EBIT), (loss) income from operations before income tax, net (loss)
income and (loss) earnings per share for the quarter and year ended
December 31, 2008 and 2007. (Loss) Income From (Loss) Operations
Earnings (In millions, except Before Net (Loss) Per Share- per
share data) Total EBIT Income Tax Income Diluted Quarter Ended
December 31: 2008 2007 2008 2007 2008 2007 2008 2007 Impairment and
restructuring charges(1) $(20) $(67) $(20) $(67) $(18) $(51)
$(0.15) $(0.38) Value added tax provision(2) - (50) - (50) - (22) -
(0.16) Gain on asset acquisitions / dispositions(3) 15 22 15 22 11
15 0.09 0.11 Total $(5) $(95) $(5) $(95) $(7) $(58) $(0.06) $(0.43)
(Loss) Income From (Loss) Operations Earnings (In millions, except
Before Net (Loss) Per Share- per share data) Total EBIT Income Tax
Income Diluted Year Ended December 31: 2008 2007 2008 2007 2008
2007 2008 2007 Transactional tax credit(4) $190 $- $190 $- $131 $-
$0.95 $- Impairment and Restructuring charges(1) (20) (78) (20)
(78) (18) (59) (0.13) (0.45) Value added tax provision(2) - (50) -
(50) - (22) - (0.17) Gain on asset acquisitions / dispositions(3)
29 22 29 22 20 15 0.15 0.11 Total $199 $(106) $199 $(106) $133
$(66) $0.97 $(0.51) (1) Impairment and restructuring pretax charges
recorded in cost of goods sold in the quarter and year ended
December 31, 2008 consisted of $18 million in the agribusiness
segment and $2 million in the edible oil products segment.
Impairment and restructuring pretax charges in the quarter ended
December 31, 2007 consisted of $25 million in the agribusiness
segment, $29 million in the edible oil products segment and $13
million in the milling products segment. Impairment and
restructuring pretax charges in the year ended December 31, 2007
consisted of $30 million in the agribusiness segment, $35 million
in the edible oil products segment and $13 million in the milling
products segment. The impairment and restructuring charges for the
year ended December 31, 2007 were recorded in cost of goods sold,
other than $11 million of the charges recorded for edible oil
products segment, which was recorded in selling, general and
administrative expenses. (2) Value-added-tax provision of $50
million in the fertilizer segment for the quarter and year ended
December 31, 2007 resulted from a 2007 change in tax laws in
several Brazilian states. This tax law became effective in 2008,
which makes the recoverability of these taxes uncertain. (3) In
2008, Bunge recorded a gain of $14 million on sale of land in its
edible oil products segment and a gain of $15 million related to
the acquisition of certain sugar assets in its agribusiness
segment. In 2007, Bunge recorded a gain of $22 million on sale of
investment securities. These gains were recorded in other income
(expense)-net. (4) As a result of favorable rulings related to
certain transactional taxes in Brazil, which were accrued and paid
in past years, in 2008 Bunge recorded $117 million and $11 million
in cost of goods sold in its agribusiness and its milling products
segments, respectively, pertaining to transactional tax credits on
sales and $60 million and $2 million in selling, general and
administrative expenses in its agribusiness and edible oil products
segment, respectively, pertaining to transactional tax credits on
financial transactions. CONSOLIDATED STATEMENTS OF INCOME (In
millions, except per share data and percentages) (Unaudited)
Quarter Ended Year Ended December 31, Percent December 31, Percent
2008 2007 Change 2008 2007 Change Net sales (Note 1) $10,943
$12,472 (12)% $52,574 $37,842 39% Cost of goods sold (Note 1)
(10,434) (11,696) (11)% (48,538) (35,327) 37% Gross profit 509 776
(34)% 4,036 2,515 60% Selling, general and administrative expenses
(369) (434) (15)% (1,613) (1,359) 19% Interest income 55 54 2% 214
166 29% Interest expense (57) (73) (22)% (249) (217) 15% Interest
expense on readily marketable inventories (19) (29) (34)% (112)
(136) (18)% Foreign exchange (loss) gain (543) 39 (1492)% (749) 217
(445)% Other income (expense)�??net 23 17 35% 10 15 (33)% (Loss)
income from operations before income tax (401) 350 (215)% 1,537
1,201 28% Income tax benefit (expense) 214 (89) (245) (310) (Loss)
income from operations after income tax (187) 261 (172)% 1,292 891
45% Minority interest (30) (42) (29)% (262) (146) 79% Equity in
earnings of affiliates 7 26 (73)% 34 33 3% Net (loss) income (210)
245 (186)% 1,064 778 37% Convertible preference share dividends
(20) (15) (78) (40) Net (loss) income available to common
shareholders $(230) $230 (200)% $986 $738 34% (Loss) Earnings Per
common share - diluted (Note 2): $(1.89) $1.82 (204)% $7.73 $5.95
30% Weighted-average common shares outstanding- diluted (Note 2)
121,627,504 134,501,104 137,591,266 130,753,807 Note 1: Net sales
and cost of goods sold for the quarter ended December 31, 2007 have
been restated. Note 2: The dilutive effect of 1,488,899 weighted
average common shares of stock-based payment awards and 14,574,787
weighted average common shares that would be issuable upon
conversion of Bunge's convertible preference shares are included in
the earnings per common share- diluted calculation for the year
ended December 31, 2008 because they were dilutive. There were no
weighted average common shares of outstanding stock-based payment
awards or weighted average common shares that would be issuable
upon conversion of the convertible preference shares, included in
the earnings per common share- diluted calculation for the quarter
ended December 31, 2008, because they would not have been dilutive.
The dilutive effect of the 11,661,359 and 8,536,729 weighted
average common shares, which would be issuable upon conversion of
Bunge's convertible preference shares, is included in the earnings
per common share- diluted calculation for the quarter and year
ended December 31, 2007, respectively, because the effect of the
conversion would have been dilutive. CONSOLIDATED SEGMENT
INFORMATION (In millions, except volumes and percentages)
(Unaudited) Set forth below is a summary of certain items in our
consolidated statements of income and volumes by reportable
segment. Quarter Ended Year Ended December 31, Percent December 31,
Percent 2008 2007 Change 2008 2007 Change Volumes (in thousands of
metric tons): Agribusiness $31,160 $28,104 11% $117,661 $114,365 3%
Fertilizer 2,386 3,548 (33)% 11,134 13,077 (15)% Edible oil
products 1,455 1,461 -% 5,736 5,530 4% Milling products 960 973
(1)% 3,932 3,983 (1)% Total 35,961 34,086 6% 138,463 136,955 1% Net
sales (Note 1): Agribusiness $7,794 $8,963 (13)% $36,688 $26,990
36% Fertilizer 985 1,272 (23)% 5,860 3,918 50% Edible oil products
1,805 1,826 (1)% 8,216 5,597 47% Milling products 359 411 (13)%
1,810 1,337 35% Total $10,943 $12,472 (12)% $52,574 $37,842 39%
Gross profit: Agribusiness $286 $496 (42)% $2,029 $1,407 44%
Fertilizer 135 157 (14)% 1,449 639 127% Edible oil products 50 102
(51)% 356 334 7% Milling products 38 21 81% 202 135 50% Total $509
$776 (34)% $4,036 $2,515 60% Selling, general and administrative
expenses: Agribusiness $(217) $(210) 3% $(858) $(661) 30%
Fertilizer (41) (85) (52)% (284) (284) -% Edible oil products (90)
(105) (14)% (368) (316) 16% Milling products (21) (34) (38)% (103)
(98) 5% Total $(369) $(434) (15)% $(1,613) $(1,359) 19% Foreign
exchange (loss) gain: Agribusiness $(165) $32 $(198) $115
Fertilizer (361) 10 (530) 104 Edible oil products (18) (2) (22) 3
Milling products 1 (1) 1 (5) Total $(543) $39 $(749) $217 Equity in
earnings of affiliates: Agribusiness $(3) $13 (123)% $6 $3 100%
Fertilizer 1 - 100% 7 (1) (800)% Edible oil products 8 11 (27)% 17
27 (37)% Milling products 1 2 (50)% 4 4 -% Total $7 $26 (73)% $34
$33 3% Minority interest: Agribusiness $(1) $(23) (96)% $(24) $(35)
(31)% Fertilizer (29) (28) 4% (323) (181) 78% Edible oil products
(1) 1 (200)% (8) 3 (367)% Milling products - - -% - - -% Total
$(31) $(50) (38)% $(355) $(213) 67% Other income/(expense):
Agribusiness $14 $22 (36)% $(6) $27 (122)% Fertilizer 6 (2) 400% 2
(6) 133% Edible oil products 4 (3) 233% 14 (6) 333% Milling
products (1) - (100)% - - -% Total $23 $17 35% $10 $15 (33)%
Segment earnings before interest and tax: Agribusiness $(86) $330
(126)% $949 $856 11% Fertilizer (289) 52 (656)% 321 271 18% Edible
oil products (47) 4 (1275)% (11) 45 (124)% Milling products 18 (12)
250% 104 36 189% Total (Note 2) $(404) $374 (208)% $1,363 $1,208
13% Reconciliation of total segment earnings before interest and
tax: Total segment earnings before interest and tax $(404) $374
$1,363 $1,208 Interest income 55 54 214 166 Interest expense (76)
(102) (361) (353) Income tax benefit (expense) 214 (89) (245) (310)
Minority interest share interest and tax 1 8 93 67 Net (loss)
income $(210) $245 $1,064 $778 Depreciation, depletion and
amortization: Agribusiness $(42) $(49) (14)% $(186) $(157) 18%
Fertilizer (31) (44) (30)% (161) (151) 7% Edible oil products (18)
(17) 6% (74) (61) 21% Milling products (4) (4) -% (18) (16) 13%
Total $(95) $(114) (17)% $(439) $(385) 14% Interest income:
Agribusiness $12 $15 (20)% $54 $38 42% Fertilizer 34 16 113% 123 64
92% Edible oil products 3 2 50% 6 4 50% Milling products 1 - 100% 2
1 100% Total $50 $33 52% $185 $107 73% Interest expense:
Agribusiness $(62) $(85) (27)% $(270) $(296) (9)% Fertilizer (8)
(2) 300% (23) (16) 44% Edible oil products (2) (15) (87)% (48) (38)
26% Milling products (4) - 100% (20) (3) 567% Total $(76) $(102)
(25)% $(361) $(353) 2% Note 1: Net sales and cost of goods sold for
the quarter ended December 31, 2007 have been restated. Note 2:
Total segment earnings before interest and tax ("EBIT") is a
non-GAAP measure and is not intended to replace net income, the
most directly comparable GAAP measure. The information required by
Regulation G under the Securities Exchange Act of 1934, including
the reconciliation to net income, is included under the caption
"Reconciliation of Non-GAAP Measures." CONDENSED CONSOLIDATED
BALANCE SHEETS (In millions) (Unaudited) December 31, December 31,
2008 2007 ASSETS Current assets: Cash and cash equivalents $1,004
$981 Trade accounts receivable 2,420 2,541 Inventories 5,653 5,924
Deferred income taxes 268 219 Other current assets 4,025 4,853
Total current assets 13,370 14,518 Property, plant and equipment,
net 3,969 4,216 Goodwill 325 354 Other intangible assets, net 107
139 Investments in affiliates 761 706 Deferred income taxes 864 903
Other non-current assets 1,028 1,155 Total assets $20,424 $21,991
LIABILITIES AND SHAREHOLDERS' EQUITY Current liabilities:
Short-term debt $473 $590 Current portion of long-term debt 78 522
Trade accounts payable 4,230 4,061 Deferred income taxes 104 166
Other current liabilities 3,383 3,495 Total current liabilities
8,268 8,834 Long-term debt 3,032 3,435 Deferred income taxes 132
149 Other non-current liabilities 864 876 Minority interest in
subsidiaries 692 752 Shareholders' equity 7,436 7,945 Total
liabilities and shareholders' equity $20,424 $21,991 CONDENSED
CONSOLIDATED STATEMENTS OF CASH FLOWS (In millions) (Unaudited)
Year Ended December 31, 2008 2007 OPERATING ACTIVITIES Net income
$1,064 $778 Adjustments to reconcile net income to cash provided by
(used for) operating activities: Foreign exchange loss (gain) on
debt 472 (285) Impairment of assets 26 70 Bad debt expense 69 46
Depreciation, depletion and amortization 439 385 Stock-based
compensation expense 66 48 Gain on sale of assets (14) (22)
(Decrease) increase in recoverable taxes provision (9) 81 Deferred
income taxes (251) (62) Minority interest 262 146 Equity in
earnings of affiliates (34) (33) Changes in operating assets and
liabilities, excluding the effects of acquisitions: Trade accounts
receivable (408) (319) Inventories (905) (1,743) Prepaid commodity
purchase contracts 300 (184) Secured advances to suppliers (143)
207 Trade accounts payable 1,233 1,231 Advances on sales (106) 190
Unrealized net gain/loss on derivative and other contracts 292
(530) Margin deposits (102) (175) Accrued liabilities 199 299 Other
- net 93 (539) Cash provided by (used for) operating activities
2,543 (411) INVESTING ACTIVITIES Payments made for capital
expenditures (896) (658) Acquisitions of businesses (net of cash
acquired) and intangible assets (131) (153) Investments in
affiliates (71) (39) Related party repayments (loans) 47 (22)
Proceeds from disposal of property, plant and equipment 39 55
(Payments for) proceeds from investment (94) 23 Cash used for
investing activities (1,106) (794) FINANCING ACTIVITIES Net change
in short-term debt with maturities of 90 days or less (687) 19
Proceeds from short-term debt with maturities greater than 90 days
1,887 1,105 Repayments of short-term debt with maturities greater
than 90 days (1,206) (1,029) Proceeds from long-term debt 1,967
2,030 Repayments of long-term debt (2,819) (1,203) Proceeds from
sale of preference shares, net - 845 Proceeds from sale of common
shares 7 32 Dividends paid to preference shareholders (81) (34)
Dividends paid to common shareholders (87) (80) Dividends paid to
minority interest (154) (18) Minority interest investments in less
than wholly-owned subsidiaries - 95 Other, net 27 - Cash (used for)
provided by financing activities (1,146) 1,762 Effect of exchange
rate changes on cash and cash equivalents (268) 59 Net increase in
cash and cash equivalents 23 616 Cash and cash equivalents,
beginning of period 981 365 Cash and cash equivalents, end of
period $1,004 $981 Reconciliation of Non-GAAP Measures This
earnings release contains total segment earnings before interest
and tax, net financial debt and net financial debt less readily
marketable inventories, which are "non-GAAP financial measures" as
this term is defined in Regulation G of the Securities Exchange Act
of 1934. In accordance with Regulation G, Bunge has reconciled
these non-GAAP financial measures to the most directly comparable
U.S. GAAP measures. Total segment earnings before interest and tax
Total segment earnings before interest and tax ("EBIT") is Bunge's
consolidated net (loss) income that excludes interest income and
expense and income tax attributable to each segment. Total segment
EBIT is a non-GAAP financial measure and is not intended to replace
net (loss) income, the most directly comparable GAAP financial
measure. Total segment EBIT is an operating performance measure
used by Bunge's management to evaluate its segments' operating
activities. Bunge believes EBIT is a useful measure of its
segments' operating profitability, since the measure reflects
equity in earnings of affiliates and minority interest and excludes
income tax. Income tax is excluded as management believes income
tax is not material to the operating performance of its segments.
Interest income and expense have become less meaningful to the
segments' operating activities as Bunge is financing more of its
working capital with equity rather than debt. In addition, EBIT is
a financial measure that is widely used by analysts and investors
in Bunge's industries. Total segment EBIT is not a measure of
consolidated operating results under U.S. GAAP and should not be
considered as an alternative to net (loss) income or any other
measure of consolidated operating results under U.S. GAAP. Below is
a reconciliation of total segment EBIT to net (loss) income:
Quarter Ended Year Ended December 31, December 31, (In millions)
2008 2007 2008 2007 Total segment EBIT $(404) $374 $1,363 $1,208
Interest income 55 54 214 166 Interest expense (76) (102) (361)
(353) Income tax benefit (expense) 214 (89) (245) (310) Minority
interest share of interest and tax 1 8 93 67 Net (loss) income
$(210) $245 $1,064 $778 Net Financial Debt Net financial debt is
the sum of short-term debt, current maturities of long-term debt
and long-term debt, less cash and cash equivalents and marketable
securities. Net financial debt is presented because management
believes it represents a meaningful measure of Bunge's leverage
capacity and solvency. Net financial debt is not a measure of
solvency under U.S. GAAP and should not be considered as an
alternative to total debt as a measure of solvency. Net financial
debt less readily marketable inventories (RMI), or net financial
debt less RMI, is the sum of short-term debt, current maturities of
long-term debt and long-term debt, less cash and cash equivalents,
marketable securities and readily marketable inventories. Net
financial debt less RMI is presented because management believes it
represents a more complete picture of Bunge's leverage capacity and
solvency since it adjusts for readily marketable inventories.
Readily marketable inventories are agricultural inventories that
are readily convertible to cash because of their commodity
characteristics, widely available markets and international pricing
mechanisms. Net financial debt less RMI is not a measure of
leverage capacity and solvency under U.S. GAAP and should not be
considered as an alternative to total debt as a measure of
solvency. Below is a reconciliation of total long-term and
short-term debt to net financial debt and to net financial debt
less readily marketable inventories: December 31, December 31, (In
millions) 2008 2007 Short-term debt $473 $590 Long-term debt,
including current portion 3,110 3,957 Total debt (1) 3,583 4,547
Less: Cash and cash equivalents (1) 1,004 981 Marketable securities
14 5 Net financial debt 2,565 3,561 Less: Readily marketable
inventories 2,619 3,358 Net financial debt less readily marketable
inventories $(54) $203 (1) Includes total debt of $11 million, and
$26 million and cash and cash equivalents of $574 million and $449
million as of December 31, 2008 and December 31, 2007,
respectively, relating to Fosfertil. DATASOURCE: Bunge Limited
CONTACT: Investors: Mark Haden, +1-914-684-3398, , or Media:
Stewart Lindsay, +1-914-684-3369, , both of Bunge Limited Web Site:
http://www.bunge.com/
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