NEW YORK — Bunge Ltd. has big plans for its food business.
Speaking on May 27 at the Citi Global Consumer Conference in New York, Drew Burke, chief financial officer of Bunge, said he envisions a scenario where food makes up about 35% of the White Plains, N.Y.-based company’s earnings, which would be up from 25% in 2014 and 16% in 2012. The past year has been a good one for the company in its quest to reach that goal.
“I think we’re very happy with our food business and the way it’s developed,” Mr. Burke said. “It is the place where we’ve invested quite a bit in the last few years as we have built out our milling business and made that much more significant in size, particularly in Mexico, and put money into our Brazilian business. So we’re getting nice underlying growth of that. We think we’re in the right places in milling. In our oil business globally, we are one of the global leaders.”
Mr. Burke said Bunge has put a lot of emphasis on capital and cost control, and as the company has looked at its food business it has found areas for margin expansion. He highlighted three: operate facilities better and get better yields; optimize the company’s footprint by having equipment operate at higher rates; and margin enhancement.“We can do a lot of things to bring more value to our customer in excess of any costs we would add to do that,” he said. “So we’ve got really an innovation on seeing what’s important to the customer and bringing that, whether it is more transparency in supply chains to let them make better claims on the label to develop new product properties. So, a lot of effort behind that.”