Segment Information

9 Months Ended

Sep. 30, 2019

In May 2019, the Company announced the creation of a new business unit. The former Origination and Oilseeds businesses were merged into a combined Ag Services and Oilseeds segment which enables the Company to better respond to market changes by integrating the supply and value chains and risk management, while delivering significant simplification and efficiency to the day-to-day business. As part of the Company’s efforts for a streamlined management structure, the combined segment is led by the former President of Oilseeds expanding his role to President of Ag Services and Oilseeds. Effective July 1, 2019, the Company changed its segment reporting to reflect the creation of the combined Ag Services and Oilseeds segment.

Prior period results have been reclassified to conform to the current period presentation.

The Company is principally engaged in procuring, transporting, storing, processing, and merchandising agricultural commodities, products, and ingredients. The Company’s operations are organized, managed, and classified into three reportable business segments: Ag Services and Oilseeds, Carbohydrate Solutions, and Nutrition. Each of these segments is organized based upon the nature of products and services offered. The Company’s remaining operations are not reportable segments, as defined by the applicable accounting standard, and are classified as Other.

The Ag Services and Oilseeds segment includes global activities related to the origination, merchandising, crushing, and further processing of oilseeds such as soybeans and soft seeds (cottonseed, sunflower seed, canola, rapeseed, and flaxseed) into vegetable oils and protein meals, in addition to the origination, transportation, and storage of agricultural commodities. Oilseeds products produced and marketed by the Company include ingredients for the food, feed, energy, and industrial products industries. Crude vegetable oils produced by the segment’s crushing activities are sold “as is” or are further processed by refining, blending, bleaching, and deodorizing into salad oils. Salad oils are sold “as is” or are further processed by hydrogenating and/or interesterifying into margarine, shortening, and other food products. Partially refined oils are used to produce biodiesel and glycols or are sold to other manufacturers for use in chemicals, paints, and other industrial products. Oilseed protein meals are principally sold to third parties to be used as ingredients in commercial livestock and poultry feeds. The Ag Services and Oilseeds segment is a major supplier of peanuts, tree nuts, and peanut-derived ingredients to both the U.S. and export markets. In North America, cotton cellulose pulp is manufactured and sold to the chemical, paper, and other industrial markets. As adjuncts to its processing assets, the segment operates an extensive global network of grain elevator and transportation assets and port operations to buy, store, clean, and transport agricultural commodities, such as oilseeds, corn, wheat, milo, oats, rice, and barley, and resells these commodities primarily as food and feed ingredients and as raw materials for the agricultural processing industry. The Ag Services and Oilseeds segment's grain sourcing, handling, and transportation network (including barge, ocean-going vessel, truck, rail, and container freight services) provides reliable and efficient services to the Company's customers and agricultural processing operations. The Ag Services and Oilseeds segment also includes agricultural commodity and feed product import, export, and global distribution activities, structured trade finance, and the Company’s share of the results of its equity investment in Wilmar International Limited (“Wilmar”) and its share of the results of its Stratas Foods LLC, Edible Oils Limited, Olenex Sarl (“Olenex”), and Pacificor joint ventures. In February 2019, the Company purchased the remaining 50% interest owned by InVivo Group in the Gleadell Agriculture Ltd. joint venture.

The Company’s Carbohydrate Solutions segment is engaged in corn and wheat wet and dry milling and other activities. The Carbohydrate Solutions segment converts corn and wheat into sweeteners, corn and wheat starches, wheat flour, and bioproducts. Its products include ingredients used in the food and beverage industry including sweeteners, starch, syrup, glucose, flour, and dextrose. Dextrose and starch are used by the Carbohydrate Solutions segment as feedstocks for its bioproducts operations. By fermentation of dextrose, the Carbohydrate Solutions segment produces alcohol and other food and animal feed ingredients. Ethyl alcohol is produced by the Company for industrial use as ethanol or as beverage grade. Ethanol, in gasoline, increases octane and is used as an extender and oxygenate. Corn gluten feed and meal, as well as distillers’ grains, are produced for use as animal feed ingredients. Corn germ, a by-product of the wet milling process, is further processed into vegetable oil and protein meal. Other Carbohydrate Solutions products include citric acids which are used in various food and industrial products. This segment also includes the Company’s share of the results of its equity investments in Hungrana Ltd., Almidones Mexicanos S.A., and Red Star Yeast Company, LLC.

The Nutrition segment engages in the manufacturing, sale, and distribution of specialty products including natural flavor ingredients, flavor systems, natural colors, proteins, emulsifiers, soluble fiber, polyols, hydrocolloids, natural health and nutrition products, and other specialty food and feed ingredients. The Nutrition segment includes activities related to the procurement, processing, and distribution of edible beans. The Nutrition segment also includes activities related to the processing and distribution of formula feeds and animal health and nutrition products and the manufacture of contract and private label pet treats and foods. During the nine months ended September 30, 2019, the Company completed the acquisitions of Neovia, a French-based global provider of value-added animal nutrition solutions, with 72 production facilities and a presence in 25 countries; Florida Chemical Company, one of the world’s largest producers of citrus oils and ingredients; and The Ziegler Group, a leading European provider of natural citrus flavor ingredients.

Other includes the Company’s remaining operations, primarily its financial business units, related to futures commission and insurance activities.

Intersegment sales have been recorded at amounts approximating market. Operating profit for each segment is based on net sales less identifiable operating expenses. Also included in operating profit for each segment is equity in earnings of affiliates based on the equity method of accounting. Specified items included in total segment operating profit and certain corporate items are not allocated to the Company’s individual business segments because operating performance of each business segment is evaluated by management exclusive of these items. Corporate results principally include the impact of LIFO-related adjustments, unallocated corporate expenses, interest cost net of investment income, and the Company’s share of the results of its equity investment in Compagnie Industrialle et Financiere des Produits Amylaces SA (Luxembourg) (“CIP”).



	Three Months Ended						Nine Months Ended
	September 30,						September 30,
(In millions)	2019			2018			2019			2018
Gross revenues
Ag Services and Oilseeds	$	14,440		$	14,206		$	41,041		$	42,797
Carbohydrate Solutions	3,018			2,909			8,472			8,625
Nutrition	1,481			933			4,322			2,920
Other	88			84			273			291
Intersegment elimination	(2,301		)	(2,332		)	(5,781		)	(6,239		)
Total gross revenues	$	16,726		$	15,800		$	48,327		$	48,394

Intersegment sales
Ag Services and Oilseeds	$	1,824		$	1,946		$	4,659		$	5,366
Carbohydrate Solutions	453			375			1,063			843
Nutrition	24			11			59			30
Total intersegment sales	$	2,301		$	2,332		$	5,781		$	6,239

Revenues from external customers
Ag Services and Oilseeds
Ag Services	$	8,246		$	7,623		$	23,653		$	23,769
Crushing	2,465			2,688			7,130			7,838
Refined Products and Other	1,905			1,949			5,599			5,824
Total Ag Services and Oilseeds	12,616			12,260			36,382			37,431
Carbohydrate Solutions
Starches and Sweeteners	1,724			1,706			5,030			5,048
Bioproducts	841			828			2,379			2,734
Total Carbohydrate Solutions	2,565			2,534			7,409			7,782
Nutrition
Wild Flavors and Specialty Ingredients	703			641			2,105			1,970
Animal Nutrition	754			281			2,158			920
Total Nutrition	1,457			922			4,263			2,890

Other	88			84			273			291
Total revenues from external customers	$	16,726		$	15,800		$	48,327		$	48,394



	Three Months Ended						Nine Months Ended
	September 30,						September 30,
(In millions)	2019			2018			2019			2018
Segment operating profit
Ag Services and Oilseeds	$	417		$	478		$	1,196		$	1,405
Carbohydrate Solutions	182			288			470			748
Nutrition	118			67			316			277
Other	47			28			72			72
Specified Items:
Gains (losses) on sales of assets and businesses⁽¹⁾	—			21			12			21
Impairment, restructuring, and settlement charges⁽²⁾	(6		)	(1		)	(52		)	(36		)
Total segment operating profit	758			881			2,014			2,487
Corporate	(255		)	(249		)	(922		)	(739		)
Earnings before income taxes	$	503		$	632		$	1,092		$	1,748

⁽¹⁾ Current year-to-date gains consisted of a gain on the sale of certain assets and a step-up gain on an equity investment. Prior quarter and year-to-date gains related to the sale of a business and an equity investment.

⁽²⁾ Current quarter and year-to-date charges primarily related to the impairment of certain long-lived assets. Prior quarter charge related to a settlement. Prior year-to-date charges consisted of impairment charges related to a long-term financing receivable and an equity investment, restructuring charges, and a settlement charge.