Reuters — Global grains trader Archer Daniels Midland beat Wall Street estimates for quarterly profits on Thursday, helped by strength in its grain milling and nutrition businesses.

Still, revenue missed analysts’ expectations and net earnings attributable to the company were 44 per cent lower than a year earlier. Shares were down nearly three per cent in extended trade, after setting a two-year high last Friday.

ADM said it benefited in the third quarter as North American demand for starches grew from a year ago and earlier in 2020, though food-service demand has suffered.

The company and rival grain traders like Bunge have faced headwinds from the COVID-19 pandemic as shuttered restaurants and reduced travel disrupted demand for food and fuel. But the merchants have weathered the crisis better than other industries as countries around the world are stocking up on wheat and other staples to ensure supplies.

“Reduced food service demand affected sweetener and flour volumes, though retail demand for flour remained solid,” ADM said.

Operating profit in ADM’s corn and wheat milling business, a unit known as carbohydrate solutions that includes starches and sweeteners, rose by 35 per cent from a year ago, to $246 million (all figures US$).

Profit in the nutrition unit jumped 24.6 per cent to $147 million, while profits in ag services and oilseeds — ADM’s biggest segment — rose 4.6 per cent to $436 million.

Excluding one-time items, the company earned 89 cents per share, while analysts on average had estimated 71 cents, according to IBES data from Refinitiv.

Net earnings attributable to ADM fell to $225 million, or 40 cents per share, including a 53-cent per share charge related to early debt retirement. That was down from $407 million, or 72 cents per share, a year earlier.

Revenue fell to $15.13 billion from $16.73 billion, below analysts’ estimates.

ADM said selling, general, and administrative expenses rose to $636 million from $578 million last year.

— Reporting for Reuters by Arundhati Sarkar in Bangalore and Tom Polansek in Chicago.

Tagged ADM, Archer Daniels Midland, Corn, earnings, foodservice, milling, nutrition, Oilseeds, processing, profit, third quarter, Wheat