Why Food Processing Company Archer-Daniels-Midland Shares Are Sinking Today

Archer-Daniels-Midland Company ADM shares are trading lower after the company placed its CFO on administrative leave and updated its FY23 outlook on Sunday. 

Also, the company has appointed Ismael Roig as its interim Chief Financial Officer. 

The company placed Vikram Luthar on leave due to an investigation studying accounting practices and procedures related to its nutrition segment.

ADM’s investigation was initiated in response to the receipt of a voluntary document request by the U.S. Securities and Exchange Commission (SEC). ADM said it is cooperating with the SEC.

Terry Crews, Lead Director, said, “Pending the outcome of the investigation, the Board determined that it was advisable to place Mr. Luthar on administrative leave. The Board will continue to work in close coordination with ADM’s advisors to identify the best path forward and ensure ADM’s processes align with financial governance best practices.”

FY23 Outlook: The company now expects adjusted EPS of above $6.90 vs. consensus of $7.28.

Also, Archer-Daniels-Midland expects to report fourth quarter and FY23 operating profit for its AS&O and Carbohydrate Solutions reporting segments in line with previous indications provided in the third quarter 2023 earnings call. 

Due to the ongoing investigation, the company has withdrawn its outlook for the nutrition segment. 

Also, Archer-Daniels-Midland expects to delay its fourth-quarter earnings release and the filing of its Annual Report on Form 10-K.

Price Action: ADM shares are down 20.2% at $54.44 on the last check Monday.