Corn Products International Inc. Earnings Cheat Sheet: Margins Keep Growing, Net Income Climbs

Corn Products International Inc. (NYSE:CPO) reported net income above Wall Street’s expectations for the third quarter. Corn Products International, together with its subsidiaries, manufactures and sells a number of ingredients to a variety of food and industrial customers.

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Corn Products International Earnings Cheat Sheet for the Third Quarter

Results: Net income for the processed and packaged goods company rose to $87.7 million ($1.12 per share) vs. $36.9 million (48 cents per share) in the same quarter a year earlier. This is a more than twofold rise from the year earlier quarter.

Revenue: Rose 59.7% to $1.63 billion from the year earlier quarter.

Actual vs. Wall St. Expectations: CPO reported adjusted net income of $1.20 per share. By that measure, the company beat the mean estimate of $1.10 per share. It beat the average revenue estimate of $1.57 billion.

Quoting Management: “Corn Products delivered another very good quarter building on our strong first half 2011 performance,” said Ilene Gordon, chairman, president and chief executive officer.”We are pleased with how well our businesses have navigated challenging macroeconomic conditions and have remained focused on successfully executing our plans. Our risk management approach has helped us weather volatile raw material markets and kept us on track to deliver our goals. In each of our regions, we have achieved significant though appropriate price increases to offset higher input costs.”

Key Stats:

Last quarter marked the fifth consecutive quarter of gross margins expanding as the company’s gross margin expanded 0.1 percentage point to 17% from the year earlier quarter. Over that span, margins have grown on average 1.5 percentage points per quarter on a year-over-year basis.

The company has now seen net income rise in three straight quarters. In the second quarter, net income rose more than twofold and in the first quarter, the figure rose more than threefold.

Revenue has risen the past four quarters. Revenue increased 58% to $1.58 billion in the second quarter. The figure rose 55.7% in the first quarter from the year earlier and climbed 46.8% in the fourth quarter of the last fiscal year from the year-ago quarter.

The company topped expectations last quarter after falling short of forecasts in the second quarter with net income of $1.10 versus a mean estimate of net income of $1.13 per share.

Looking Forward: Over the last 30 days, analysts have not been optimistic about the company’s next quarter performance. The average estimate for the fourth quarter is now $1.07 per share, down from $1.11. The average estimate for the fiscal year is $4.51 per share, down from $4.62 ninety days ago.

Competitors to Watch: Archer Daniels Midland Co. (NYSE:ADM), Bunge Limited (NYSE:BG), MGP Ingredients, Inc. (NASDAQ:MGPI), Darling International Inc. (NYSE:DAR), SunOpta, Inc. (NASDAQ:STKL), Mosaic (NYSE:MOS), Potash (NYSE:POT), Agrium (NYSE:AGU) and CF Industries (NYSE:CF).

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(Source: Xignite Financials)