Event Brief of Q3 2004 Archer Daniels Midland Company Earnings Conference Call - Final.

Original Source: FD (FAIR DISCLOSURE) WIRE

CORPORATE PARTICIPANTS

. Allen Andreas, Archer Daniels Midland Co., Chairman & CEO . Doug Schmalz, Archer Daniels Midland Co., CFO . Brian Peterson, Archer Daniels Midland Co., SVP, Corporate Affairs

OVERVIEW

ADM reported 3Q04 net earnings of $226.769m or $0.35 per share. Total operating segment profit more than doubled to $502m from $242m in 3Q03. Oilseed processing profit was $117m, corn processing profit was $160m, wheat processing profit was $10m, agricultural services profit was $56m, and the Other segment had profit of $159m with cocoa, specialty food, and specialty feed all improving. Q&A Focus: high fructose corn syrup, global oilseed, Ag services, Asian soybeans.

FINANCIAL DATA

A. Key Data From Call 1. Net Earnings: $226.769m or $0.35 per share.

2. Net Sales & Other Operating Income: $9.3b. 3. Gross Profit: $587m. 4. SG&A: $252m. 5. Interest Expense: $87m. 6. Investment Income: $36m. 7. Effective Tax Rate: 33%.

PRESENTATION SUMMARY

S1. Financial Review (D.S.) 1. Earnings: 1. Net earnings $226.769m or $0.35 per share vs. $116.805m or $0.18 per share in 3Q03.

2. Includes: 1. Loss on asset impairments of $12m, $8m after-tax or $0.01 per share. 2. Gain from insurance-related lawsuit pertaining to flood of 1993 of $21m, $13m after-tax or $0.02 per share. 3. Gain from sale of equity securities of $11m, $7m after-tax

or $0.01 per share. 4. Rising commodity prices on LIFO inventory evaluations resulted in pretax charge of $99m vs. $4m in 3Q03.

3. Effective tax rate 33% vs. 24% in 3Q03. 2. Consolidated Financial Results (QoverQ): 1. Net sales and other operating income up 18% to $9.3b. 2. Gross profit up 42% to $587m. 3. SG&A up $20m to $252m. 4. Interest expense down $6m to $87m. 5. Investment income up $6m to $36m. 1. Security transactions reflect gain realized on sale of portion of investment in overseas ship holdings.

6. Equity and earnings of unconsolidated affiliates up to $45m

from $19m in 3Q03. 1. Earnings from private equity investments $13m vs. loss of $2m in 3Q03. 7. Effective tax rate 33% vs. 31% in 2Q04. 3. Segment Financial Results (QoverQ): 1. Total operating segment profit more than doubled to $502m from $242m in 3Q03.

2. Oilseed processing profit $117m, up $42m from $75m in 3Q03.

1. Includes $3m asset impairment charge. 3. Corn processing profit $160m, up $71m from $89m. 1. Includes $15m from insurance-related lawsuit and $1m asset impairment charge. 4. Wheat processing results up to $10m from $6m in 3Q03. 5. Agricultural services profit up to $56m from $4m in 3Q03. 1. Includes $2m from insurance-related lawsuit. 6. Other segment results up to $159m from $68m in 3Q03.

1. Includes $8m asset impairment charge. 7. Specialty Feed Ingredients results improved over prior year. 8. Cocoa processing improved over 3Q03. 9. Specialty Food Ingredient operations improved.

1. Citric acid still not performing at acceptable levels. 10. Corporate expense up $75m to $163m from $89m in 3Q03.

S2. Balance Sheet Items (D.S.) 1. Working Capital: 1. During first nine months of FY04, trade working capital up $2.4b to $6.9b at March 31. 2. $1.6b relates to increases in readily marketable inventories. 1. Readily marketable inventories current value on March 31 was $3.9b. 2. Increase financed primarily with cash flow from operations and short term borrowings of $1.5b. 2. Debt: 1. Outstanding short term debt approx. $2.8b at March 31.

2. Total interest bearing debt as percent of invested capital

42%, up 3.2% from June, 2003 level of 38.8%; decline of about

0.2% from March, 2003 level of 42.2%. 3. Cash Flow: 1. Cash flow from operations for nine months ended March 31 equal

to net earnings of $598m, plus depreciation, amortization, and

asset impairment charges of $553m, totaling $1.15b. 2. Cash flow used to support: 1. Increased working capital. 2. Capex of $366m. 3. Acquisitions of $54m. 4. Stock repurchases of $4m. 5. Dividends of $127m.

S3. Segment Review (B.P.) 1. Oilseed: 1. Operating profit $118m, up 56% from 3Q03. 2. Results in North America and Asia had solid increases. 3. Results in South America and Europe weaker. 1. Crushing margins reduced in South America. 2. Increased meal exports from South America continue to pressure margins in Europe.

4. 415m bushels of soybeans crushed in 3Q03; 406m bushels crushed

in 3Q04. 2. Industry projections are for processing rate to drop to low 300 range for next two quarters. 1. Processing situation today is as follows: 2. US soybean supply remains tight.

3. South America new crop estimates have been gradually reduced.

4. Brazil crop now projected at around 50m tons; below last

year's production. 5. Argentina now projected at 33m tons; slightly below last year's production. 6. Soybean supply will remain tight until North American harvest and beyond.

7. Well prepared for challenge ahead. 8. Demand for protein meal remains strong, despite high prices. 9. US vegetable oil supplies projected tight for some months. 1. Expect acceptable crush margins in North America. 2. Current capacity utilization is around 75% in North America with good crush margins. 10. US soybean plant should be running at lower rates this summer. 11. Margins in North American cottonseed and softseed crushing businesses are good. 12. Brazil crush margins continue to be unsatisfactory.

13. Europe battling meal imports from South America; causing a

weak crush margin environment. 14. Capacity utilization in Europe around 78%, down from 85% range in 2Q04. 15. Asian operations running at reduced rates. 1. Chinese demand will continue to grow as it recovers from effect of Avian flu. 3. Food Industry:

1. Customers continue to show interest in zero trans fat product

portfolio. 2. Co.'s broad product line of refined and specialty oils meets demand of customers. 3. Will face challenging environment with soybean prices high and in short supply. 4. Corn Processing: 1. Profits $160m, up 80% vs. 3Q03. 2. Sweeteners had higher profits, higher selling prices, and slightly higher volumes. 3. Prices up for high fructose corn syrup. 4. Continue to expand production of higher valued portfolio as way to improve margins. 5. Continue to grow bioproducts production. 6. Fermentation capacities now fully utilized. 5. Ethanol: 1. Profits up on improved YoverY pricing. 2. Volumes up as excess inventory …