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Monsanto Co. on Tuesday boosted its fiscal 2008 earnings expectation, excluding extraordinary items, by about 16 percent as a result of strong seed and herbicide sales coupled with fiscal discipline.

It is the second time this year that the Creve Coeur-based company has increased its earnings guidance.

Monsanto now says it expects full-year earnings from ongoing operations in the range of $3.15 to $3.25 a share, up from February’s guidance of $2.70 to $2.80. It will report second-quarter results on April 2, and projects earnings, excluding one-time gains, in that period of $1.75. The second quarter ended Feb. 29.

In addition, the company will receive a payout of 23 cents a share on claims in the recently completed bankruptcy case of corporate cousin Solutia Inc. That will bring annual reported earnings to $3.38 to $3.48 a share.
The news drove up Monsanto’s shares by nearly 10 percent Tuesday, to $114.54 from Monday’s close of $104.26.

Monsanto said gross profit from its seeds and traits business will be in the range of $3.6 billion to $3.7 billion this year, up 20 percent from 2007 instant cash advance. It is selling more soybean seeds than last year, and use of its biotech corn traits also is increasing.

Global demand for Roundup herbicide is outpacing supply, and that business should deliver between $1.7 billion and $1.8 billion in gross profit this year, Monsanto said.

The company also noted it is holding spending on sales and general and administrative items to 20 percent of sales; and research and development costs at 9 percent.

Looking ahead, Monsanto said it expects to reach in 2010 its targeted gross margin in the range of 52 to 54 percent — two years ahead of schedule.

"Our growth over the next five years will be built on our seeds-and-traits platform, and we’ve already exceeded a number of milestones that put us ahead of our plan to deliver consistent, sustainable growth," said Hugh Grant, chairman, president and chief executive, in a statement.

rmelcer@post-dispatch.com | 314-340-8394

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