# Archer-Daniels-Midland Co: Form 10-Q/A for the period ended Mar 31, 2024

- Company: [Archer-Daniels-Midland Co](/companies/adm.md) (CIK 7084)
- Form: 10-Q/A
- Filed: 2024-11-18
- Accepted by EDGAR: Nov 18, 2024, 21:02 ET
- Period: 2024-03-31
- Accession: 0000007084-24-000052
- Inline XBRL: yes
- Main document: https://www.sec.gov/Archives/edgar/data/7084/000000708424000052/adm-20240331.htm
- All documents and exhibits: https://www.sec.gov/Archives/edgar/data/7084/000000708424000052/

## Figures reported in this filing

Standardized XBRL line items for the period ended 2024-03-31.

| Line item | Period | Value | XBRL concept |
| --- | --- | ---: | --- |
| Revenue | 3 months, 2024-01-01 to 2024-03-31 | $21.85bn | us-gaap:RevenueFromContractWithCustomerExcludingAssessedTax |
| Cost of revenue | 3 months, 2024-01-01 to 2024-03-31 | $20.19bn | us-gaap:CostOfRevenue |
| Gross profit | 3 months, 2024-01-01 to 2024-03-31 | $1.66bn | us-gaap:GrossProfit |
| Selling, general and administrative | 3 months, 2024-01-01 to 2024-03-31 | $951.0m | us-gaap:SellingGeneralAndAdministrativeExpense |
| Interest expense | 3 months, 2024-01-01 to 2024-03-31 | $166.0m | us-gaap:InterestExpense |
| Income tax | 3 months, 2024-01-01 to 2024-03-31 | $166.0m | us-gaap:IncomeTaxExpenseBenefit |
| Net income | 3 months, 2024-01-01 to 2024-03-31 | $729.0m | us-gaap:NetIncomeLoss |
| Diluted EPS | 3 months, 2024-01-01 to 2024-03-31 | $1.42 | us-gaap:EarningsPerShareDiluted |
| Basic EPS | 3 months, 2024-01-01 to 2024-03-31 | $1.42 | us-gaap:EarningsPerShareBasic |
| Diluted shares (weighted) | 3 months, 2024-01-01 to 2024-03-31 | 514,000,000 shares | us-gaap:WeightedAverageNumberOfDilutedSharesOutstanding |
| Operating cash flow | 3 months, 2024-01-01 to 2024-03-31 | $700.0m | us-gaap:NetCashProvidedByUsedInOperatingActivities |
| Capital expenditure | 3 months, 2024-01-01 to 2024-03-31 | $328.0m | us-gaap:PaymentsToAcquirePropertyPlantAndEquipment |
| Dividends paid | 3 months, 2024-01-01 to 2024-03-31 | $257.0m | us-gaap:PaymentsOfDividends |
| Share repurchases | 3 months, 2024-01-01 to 2024-03-31 | $1.33bn | us-gaap:PaymentsForRepurchaseOfCommonStock |
| Cash and equivalents | at 2024-03-31 | $830.0m | us-gaap:CashAndCashEquivalentsAtCarryingValue |
| Current assets | at 2024-03-31 | $29.01bn | us-gaap:AssetsCurrent |
| Total assets | at 2024-03-31 | $54.83bn | us-gaap:Assets |
| Current liabilities | at 2024-03-31 | $19.73bn | us-gaap:LiabilitiesCurrent |
| Long-term debt | at 2024-03-31 | $8.24bn | us-gaap:LongTermDebtNoncurrent |
| Current portion of debt | at 2024-03-31 | $1.0m | us-gaap:LongTermDebtCurrent |
| Short-term borrowings | at 2024-03-31 | $1.73bn | us-gaap:ShortTermBorrowings |
| Shareholders' equity | at 2024-03-31 | $23.23bn | us-gaap:StockholdersEquityIncludingPortionAttributableToNoncontrollingInterest |

## Management's discussion and analysis

As filed, 5,760 characters.

### Liquidity and Capital Resources

A Company objective is to have sufficient liquidity, balance sheet strength, and financial flexibility to fund the operating and capital requirements of a capital-intensive agricultural commodity-based business. The Company depends on access to credit markets, which can be impacted by its credit rating and factors outside of ADM’s control, to fund its working capital needs and capital expenditures. The primary source of funds to finance ADM’s operations, capital expenditures, and advancement of its growth strategy is cash generated by operations and lines of credit, including a commercial paper borrowing facility and accounts receivable securitization programs. In addition, the Company believes it has access to funds from public and private equity and debt capital markets in both U.S. and international markets.

Cash provided by operating activities was $0.7 billion for the three months ended March 31, 2024 compared to a use of $1.6 billion for the same period last year. Working capital changes decreased cash by $0.2 billion for the three months ended March 31, 2024 compared to a decrease of $2.9 billion for the same period last year. Segregated investments increased $0.2 billion due to increased trading activity in the Company’s futures commission and brokerage business. Trade receivables decreased $0.1 billion due to lower revenues. Inventories decreased $0.3 billion due to lower inventory prices and volumes. Trade payables decreased $0.7 billion primarily due to lower payables related to grain purchases. Brokerage payables increased approximately $0.3 billion due to increased trading activity in the Company’s futures commission and brokerage business.

Cash used in investing activities was $1.2 billion for the three months ended March 31, 2024 compared to $0.3 billion for the same period last year. Capital expenditures for the three months ended March 31, 2024 of $0.3 billion was comparable to the same period last year. Net assets of businesses acquired in the three months ended March 31, 2024 were $0.9 billion compared to none in the same period last year.

Cash used in financing activities was $2 million for the three months ended March 31, 2024 compared to cash provided of $0.6 billion for the same period last year. Long-term debt payments were immaterial for the three months ended March 31, 2024 compared to $2 million for the same period last year. Net borrowings on short-term credit agreements for the three months ended March 31, 2024 were $1.6 billion compared to $1.3 billion for the same period last year. Share repurchases for the three months ended March 31, 2024 were $1.3 billion compared to $0.4 billion for the same period last year. Dividends were $0.3 billion for the three months ended March 31, 2024 compared to $0.2 billion for the same period last year.

At March 31, 2024, the Company had $0.8 billion of cash and cash equivalents and a current ratio, defined as current assets divided by current liabilities, of 1.5 to 1. Included in working capital was $6.7 billion of readily marketable commodity inventories. At March 31, 2024, the Company’s capital resources included shareholders’ equity of $23.2 billion and lines of credit, including the accounts receivable securitization programs described below, totaling $12.8 billion, of which $8.8 billion was unused. The Company’s ratio of long-term debt to total capital (the sum of long-term debt of $8.2 billion and shareholders’ equity of $23.2 billion in 2024 and the sum of long-term debt of $8.3 billion and shareholders’ equity of $24.1 billion in 2023) was 26% and 25% at March 31, 2024 and December 31, 2023, respectively. The Company uses this ratio as a measure of the Company’s long-term indebtedness and an indicator of financial flexibility. The Company’s ratio of net debt (the sum of short-term debt of $1.7 billion, current maturities of long-term debt of $1 million, and long-term debt of $8.2 billion less the sum of cash and cash equivalents of $0.8 billion and short-term marketable securities of none in 2024 and the sum of short-term debt of $0.1 billion, current maturities of long-term debt of $1 million, and long-term debt of $8.3 billion less the sum of cash and cash equivalents of $1.4 billion and short-term marketable securities of none in 2023) to capital (the sum of net debt of $9.2 billion and shareholders’ equity of $23.2 billion in 2024 and the sum of net debt of $7.0 billion and shareholders' equity of $24.1 billion in 2023) was 28% and 22% at March 31, 2024 and December 31, 2023, respectively. Of the Company’s total lines of credit, $5.0 billion supported the combined U.S. and European commercial paper borrowing programs, against which there was $0.9 billion of commercial paper outstanding at March 31, 2024.

As of March 31, 2024, the Company had $0.8 billion of cash and cash equivalents, $0.7 billion of which was cash held by foreign subsidiaries whose undistributed earnings are considered indefinitely reinvested. Based on the Company’s historical ability to generate sufficient cash flows from its U.S. operations and unused and available U.S. credit capacity of $5.2 billion, the Company has asserted that these funds are indefinitely reinvested outside the U.S.

The Company has accounts receivable securitization programs (the “Programs”) with certain commercial paper conduit purchasers and committed purchasers. The Programs provide the Company with up to $3.0 billion in funding against accounts receivable transferred into the Programs and expands the Company’s access to liquidity through efficient use of its balance sheet assets (see Note 15 of “Notes to Consolidated Financial Statements” included in Item 1 herein, “Financial Statements” for

## Market risk

As filed, 1,955 characters.

#### Commodities

The availability and prices of agricultural commodities are subject to wide fluctuations due to factors such as changes in weather conditions, crop disease, plantings, government programs and policies, competition, changes in global demand, changes in customer preferences and standards of living, and global production of similar and competitive crops.

The fair value of the Company’s commodity position is a summation of the fair values calculated for each commodity by valuing all of the commodity positions at quoted market prices for the period, where available, or utilizing a close proxy. The Company has established metrics to monitor the amount of market risk exposure, which consist of volumetric limits and value-at-risk (VaR) limits. VaR measures the potential loss, at a 95% confidence level, that could be incurred over a one-year period. Volumetric limits are monitored daily and VaR calculations and sensitivity analysis are monitored weekly.

In addition to measuring the hypothetical loss resulting from an adverse two standard deviation move in market prices (assuming no correlations) over a one-year period using VaR, sensitivity analysis is performed measuring the potential loss in fair value resulting from a hypothetical 10% adverse change in market prices. The highest, lowest, and average weekly position together with the market risk from a hypothetical 10% adverse price change is as follows:

| Long/(Short) (In millions) | Three months ended March 31, 2024 Fair Value | Market Risk | Year ended December 31, 2023 Fair Value | Market Risk |
| --- | ---: | ---: | ---: | ---: |
| Highest position | **$(265)** | **$(27)** | $498 | $50 |
| Lowest position | **6** | **1** | (6) | (1) |
| Average position | **(56)** | **(6)** | 125 | 13 |

The change in fair value of the average position was due to the overall decrease in average quantities, partially offset by the increase in prices of certain commodities.

## Controls and procedures

As filed, 2,367 characters.

### Evaluation of Disclosure Controls and Procedures

At the time of the filing of this Amendment, an evaluation was performed under the supervision and with the participation of the Company’s management, including the Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of the Company’s “disclosure controls and procedures” (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934 (the “Exchange Act”)), as of March 31, 2024. Based on that evaluation, the Company’s Chief Executive Officer and Chief Financial Officer, concluded the Company’s disclosure controls and procedures were not effective as of March 31, 2024, due to the material weakness described below.

### Internal Control Over Financial Reporting

As disclosed in the Company’s Annual Report on Form 10-K/A for the year ended December 31, 2023, during the fourth quarter of 2023, in connection with the Investigation, the Company identified a material weakness in its internal control over financial reporting related to the Company’s accounting practices and procedures for segment disclosures. The material weakness resulted from inadequate controls that allowed for certain intersegment sales to be reported at amounts that were not in accordance with ASC 606, *Revenue from Contracts with Customers*. Specifically, the Company did not have adequate controls in place around measurement of certain intersegment sales between the Company’s reporting segments. In addition, appropriate controls were not in place for the reporting of intersegment sales and for the application of disclosure requirements within ASC 280, *Segment Reporting*. The absence of adequate controls with respect to the reporting of intersegment sales impacted the completeness and accuracy of the Company’s segment disclosures and review controls over projected financial information utilized in goodwill and other long-lived asset impairment tests.

### Remediation Plan

The Company is implementing enhancements to its internal controls to remediate the identified material weakness in its internal control over financial reporting related to the Company’s accounting practices and procedures for intersegment sales and to enhance the reliability of its financial statements with respect to the pricing and reporting of such sales. Specifically, the

## Risk factors

As filed, 230 characters.

In addition to the other information set forth in this report, you should carefully consider the risk factors discussed in “Item 1A. Risk Factors” in the Company’s Annual Report on Form 10-K/A for the year ended December 31, 2023.

Filed Nov 18, 2024.
Source: SEC EDGAR, the filing index for accession 0000007084-24-000052. Last ingested by Listed: Oct 24, 2026, 14:51 ET. No prices; not investment advice.