WASHINGTON (AP) — Monsanto said Wednesday it will eliminate another 1,000 jobs as it expands a cost-cutting plan designed to deal with falling sales of biotech-corn seeds and other financial headwinds.
The additional layoffs will bring the agriculture giant's total planned cuts to 3,600 jobs over the next two years, or about 16 percent of its global workforce. In October the company first announced the restructuring plan, intended to streamline its sales, R&D and other operations.
The St. Louis-based company says the restructuring will cost between $1.1 billion and $1.2 billion to implement, up from previous estimates of $850 million to $900 million. By the end of fiscal 2018, the company expects the changes to generate annual savings of $500 million.
Its shares fell more than 2 percent in afternoon trading Wednesday.
Monsanto has struggled in recent quarters to deal with slumping corn prices in the U.S., which have reduced demand for its best-selling product: genetically-enhanced corn seeds. Farmers are shifting more acres to other crops after surpluses of corn, wheat and others have squashed commodity prices.
The job cuts came as Monsanto reported a net loss of $253 million, or 56 cents per share, for its first fiscal quarter. It cited foreign currency pressures and falling seed sales. When adjusted for one-time items, the loss was 11 cents per share.
That was better than forecasts for a loss of 24 cents per share, according to the average estimate of nine analysts surveyed by Zacks Investment Research.
The agriculture products company posted a 23 percent decline in revenue to $2.22 billion in the period, short of Street forecasts. Three analysts surveyed by Zacks expected $2.55 billion.
In the most recent quarter corn seed sales fell nearly 20 percent to $745 million. Those results were partially offset by higher soybean sales, which grew 10 percent to $438 million.
Monsanto's biotech seeds have genetically engineered traits, such as protection against insects and disease, which help farmers increase their crop yield, despite their higher prices. The company, which also sells herbicide, has dominated the bioengineered-seed business for more than a decade and controls an estimated 18 percent of the $44 billion global seed market, according to Edward Jones analyst Matt Arnold.
Monsanto has recently developed products specifically for emerging markets like Argentina, Brazil and parts of Asia.
The company cautioned that its fiscal 2016 results would likely be in the lower range of its full-year guidance, $5.10 to $5.60, due to financial pressures, including the devaluation of Argentina's peso.
"The headwinds from currency and commodity prices that we outlined at the start of this fiscal year have not yet abated and in fact currency has become a much stronger headwind with the recent events in Argentina," CEO Hugh Grant told analysts Wednesday.
For the year, Monsanto expects negative currency trends will lower its earnings by 60 to 70 cents per share, more than its previous estimate of 35 to 40 cents per share.
Monsanto shares fell $2.41, or 2.5 percent, to $94.33 in afternoon trading. Company shares have fallen about 19 percent over the past year.
This story corrects that the $1.1 billion to $1.2 billion figure cited by Monsanto represents the costs of the restructuring plan, not the savings. The company had an adjusted loss of 11 cents per share, not a profit. Its revenue fell 23 percent, not 17 percent.