Bunge Ltd Q4 2015 Earnings Call Summary

The following is excerpted from the question-and-answer section of the transcript.

Question: Cornell Burnette - Citi - Analyst : Good morning, guys. This is Cornell in with a few questions for David.

Question: Cornell Burnette - Citi - Analyst : First, I just want to start out with a quick question on the guidance. In the prepared comments, you mentioned modest earnings growth for 2016. So, is that putting 2016 earnings in the range of [5 to 525]?

Question: Cornell Burnette - Citi - Analyst : But by saying modest, you're basically saying, look we can have some growth, but it's hard to see anything double digits or greater. Is that a fair way to interpret it?

Question: Cornell Burnette - Citi - Analyst : Okay and then following up on that and going one year out, I know you've, in the past, communicated a target of $8.50 for 2017. Is that target still in play, or given your comments of possibly modest growth this year, do you think that 2017 objective may be too high at this point?

Question: Cornell Burnette - Citi - Analyst : Okay, great. And then one last question, if I may. And it's focusing on the oilseed processing markets. Given that we've heard very little news of any new meaningful capacity being built globally, why do you think the market got so out of balance so quickly between the third quarter and the fourth quarter in soy crush. And then, when you look at Argentina, how much new soy crush do you estimate has become available out of Argentina? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. FEBRUARY 11, 2016 / 3:00PM, BG.N - Q4 2015 Bunge Ltd Earnings Call

Question: Cornell Burnette - Citi - Analyst : Okay. Sounds good. Thank you.

Question: Ann Duignan - JPMorgan - Analyst : Hi. Good morning.

Question: Ann Duignan - JPMorgan - Analyst : Can we focus on Argentina again? Can you talk a little bit more about your outlook for Argentina's role in global exports, not just of meal, but also of wheat and corn, and what net impact could that have on Brazil and on your operations in Brazil?

Question: Adam Samuelson - Goldman Sachs - Analyst : Yes. Thanks. Good morning, everyone. I want to come back to this idea of the $8.50 EPS target, which if I'm recalling correctly, was still completely ex sugar items, so comparable to the way you presented your returns ex sugar in the last couple of years. You had basically flat NOPAT for three years, and your invested capital has gone down about $3.5 billion, largely on currency, because net income after dividends and repurchases has been modestly positive, I believe. And so you're talking about, medium-term, an expectation of $500 million or so of EBIT improvement in the agribusiness and food and ingredients businesses. I presume you're not expecting significant incremental capital investments into those businesses in large quantities. The dollar would seem to be expected to stay strong. And so under that math, your return on invested capital to get to an $8.50 EPS target would expand something on the order of 400 basis points, or something on the order of 14%. Does that math makes sense? And if so, why should we have confidence that that's actually going to happen?

Question: Adam Samuelson - Goldman Sachs - Analyst : If I could squeeze in one follow-up on sugar. Clearly, you've talked about a better outlook for the sugar business in 2016. The initial data points would support that. Any way of banding how big of an impact that could actually be? You said the milling business was EBIT positive in the year, though you're still negative in the segment from the trading and the JVs. But, banding the earnings improvement expected from the milling in aggregate in 2016 would be helpful.

Question: Adam Samuelson - Goldman Sachs - Analyst : All right. Thank you very much.

Question: Neel Kumar - Morgan Stanley - Analyst : Hi, this is Neel Kumar calling in for Vincent. I was wondering if you could maybe talk a little bit about how working capital is expected to trend in 2016, and also will there be a reversal in the secured advances to suppliers line item? And why did receivables spike?

Question: Neel Kumar - Morgan Stanley - Analyst : Great. Thanks.

Question: Farha Aslam - Stephens Inc. - Analyst : Hi, good morning. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. FEBRUARY 11, 2016 / 3:00PM, BG.N - Q4 2015 Bunge Ltd Earnings Call

Question: Farha Aslam - Stephens Inc. - Analyst : I have a question on your milling business, your wheat milling. Usually that business is pretty stable. It's being impacted near-term by the Brazilian wheat situation. How long should we expect that impact to last? And what can we look for the business to deliver in 2016?

Question: Farha Aslam - Stephens Inc. - Analyst : Okay. And then, we've gone through sugar and milling so far, in terms of outlook 2016 versus 2015. Can I just ask for a little bit more color on edible oils? You'd said that you expect it to be better than 2015, but not quite up to 2016 levels. Any thoughts on the cadence of the recovery, et cetera, and how we can think about that?

Question: Farha Aslam - Stephens Inc. - Analyst : Brilliant. And on fertilizer, are volumes outflowing normally in Argentina given that we now have the devaluation?

Question: Farha Aslam - Stephens Inc. - Analyst : Great, and my final question is on sugar. Any strategic move on sugar that we should anticipate this year? How are you thinking about sugar longer term in your portfolio?

Question: Farha Aslam - Stephens Inc. - Analyst : That's helpful. Thank you.

Question: Ken Zaslow - Bank of Montreal - Analyst : Hey, good morning everyone.

Question: Ken Zaslow - Bank of Montreal - Analyst : Soren, in your opening comments, you said that you think Bunge has structural advantages and your team possesses, or is positioned, or has shown that you've been able to go through different environments. It seems like from the last couple of years of results, I'm not sure if I would say that has proven out as much as what you're saying. So, my first question is how do you get to the point that you have illustrated these structural advantages, and that your team is positioned to go through a lot of environments? And then a follow-up to that is, do you think you are actually optimizing your asset base?

Question: Ken Zaslow - Bank of Montreal - Analyst : Okay, so my question is, there seems to then be a disconnect between the market and how you feel, so are there options, bigger opportunities in terms of asset changes, or anything like that to better optimize your value to the market?

Question: Ken Zaslow - Bank of Montreal - Analyst : Besides the sale of the sugar asset, the market obviously may not agree 100% with what you're saying versus how you're optimizing your assets, right? Because your trading close to book value. So there's a disconnect. So my question is, is there a process to which that you review to see if there is a way to maximize the shareholder value relative to how you think about it. Is there an option for you to do something more than just selling the sugar asset? Is there something like break up the divisions, sell divisions, do something to create the value that you see that the market may not fully appreciate?

Question: Ken Zaslow - Bank of Montreal - Analyst : Last question is, in 2016 you called modest growth, there's obviously debate if it's 7% or 15% or whatever, but the reality is to go from 2015 number to $8.50, it's over a 67% increase. There has to be a year in which you have a hockey stick-type of growth. The question is, is there an environment we have to wish for for that? Is there an asset change? Is there an execution? Is there a people change? What is it that gets you away from the modest growth, and say, look we are re-establishing our earnings platform? I'll leave it there.

Question: Ken Zaslow - Bank of Montreal - Analyst : Okay. Just mathematically it has to be above modest growth at one point, so I appreciate it.