Adds statement from ADM, paragraph 3
By Ana Mano
SAO PAULO, April 9 (Reuters) - U.S. grain trader Archer-Daniels-Midland Co ADM.N has appointed an executive whose division was involved in accounting irregularities that have drawn federal scrutiny to a newly created role as president for North America, according to a source and an internal memo seen by Reuters on Wednesday.
The executive, Christopher Cuddy, will also remain global president of carbohydrate solutions, according to the memo.
The new role was "created to support the unique needs of our business," an ADM spokeswoman said in a statement.
The Chicago-based company has been dealing with cost pressures that triggered layoffs and an accounting scandal that forced it to revise six years of financial statements, which sent shares plummeting.
Under Cuddy's leadership, ADM's carbohydrate solutions unit was involved in inter-segment transactions at below-market rates that artificially boosted the company's nutrition segment's operating profit over a six-year period. The performance of the nutrition segment was tied to an outsized proportion of executive compensation during that time.
ADM remains under federal investigation following the accounting irregularities.
A filing last year showed that ADM had overstated the nutrition segment's annual operating profit by as much as 9.2% between 2018 and 2023, while Cuddy's carbohydrate solutions division understated operating profit by as much as 4%.
Juan Luciano, ADM's chief executive, said in the memo that "given the dynamic geopolitical environment, we believe that adapting our current geographical alignment will enhance ADM's ability to drive our strategy forward."
Cuddy is tasked with working closely with Domingo Lastra, ADM's president for Latin America, as the company puts Mexico and the Caribbean under the North America structure, the memo said.
ADM in February said it would cut up to 700 jobs and reduce costs by $500 million to $750 million over the next three to five years, after posting its lowest fourth-quarter adjusted profit in six years. The job cuts would represent about 1.7% of the company's global workforce.
ADM shares are down 38% since news of the accounting issues broke in January 2024, sending its market value plunging to just above $20 billion from nearly $37 billion previously, according to LSEG data.
(Reporting by Ana Mano in Sao Paulo, Chris Prentice in New York and Karl Plume in Chicago; Editing by Emily Schmall, Leslie Adler and David Gregorio)
((ana.mano@thomsonreuters.com; Tel: +55-11-5644-7704; Mob: +55-119-4470-4529; Reuters Messaging: ana.mano.thomsonreuters.com@reuters.net/))
Comments